The Telephone Consumer Protection Act ("TCPA") governs telephonic solicitations sent using specific telephonic equipment without consent. See, e.g., 47 U.S.C. § 277, et seq. And yet, the TCPA does not broadly restrict any and all communications; rather, the Act applies only to messages that meet the requirements articulated in the statute.
The applicable portion of the TCPA states in material part:
47 U.S.C. § 227 RESTRICTIONS ON THE USE OF TELEPHONE EQUIPMENT
(b) RESTRICTIONS ON THE USE OF AUTOMATED TELEPHONE EQUIPMENT
(1) PROHIBITIONS. – It shall be unlawful for any persons within the United States, …
(A) to make any call (other than a call .. made with the prior express consent of the called party) using any automatic telephone dialing system or an artificial or prerecorded voice –
(iii) to any telephone number assigned to a … cellular telephone service… 47 U.S.C. § 227(b)(1)(A)(iii)
Therefore, in order to prevail under the TCPA a plaintiff must establish the following three elements:
(1). The defendant called a cellular telephone number;
(2). Using an automatic telephone dialing system or an artificial or prerecorded voice., and;
(3). Without consent.
Meyer v. Portfolio Recovery Assoc., LLC, 707 F.3d 1036, 1043 (9th Cir. 2012).
Agencies are more frequently "farming out" the processing and dialing of telephone numbers to outside third parties. On the surface, the utilization of third parties to process and make the actual calls is logical and cost effective. Third party debt collectors are in the business of collecting debt. Their systems are designed to provide accurate information to its collection associates to allow those associates the opportunity to work with debtors to retire their debts and assist the debtor in reconstructing their financial lives. With some agencies handling hundreds of thousands of accounts per day, the software and hardware necessary to handle, process and load these accounts into a system is often best left to companies that specialize in this business.
To implement a successful and cost-effective system, an employee of Defendant, more likely than not, the director of IT for that agency, on a daily basis uploads the telephone numbers to be called and transmits these raw numbers to a third party, hypothetically called ABC Corp. ABC Corp. then processes those telephone numbers, and adapts them into a format its hardware and software system understands. It may even utilize a “voice over internet protocol” system to process the raw data. ABC Corp. converts the raw data received from the agency into a format that its system understands and then passes this information along to its network of telephone carriers who then launch the calls. By way of example, the ABC Corp. software platform processes a telephone call and if a connection is made to a live person by the telephone carrier utilized by ABC Corp., the call is only then transferred to an employee of that agency. This system is being utilized by a number of agencies in the debt collection industry today.
Meanwhile, TCPA cases filed nationwide are increasing at an alarming rate. In 2008, there were 14 TCPA cases filed nationwide. In 2013, there were almost 1,900 lawsuits filed in federal courts alleging violations of the TCPA. (According to data provided by WebRecon, LLC) The reason for this explosion in growth is obvious. Liability under the TCPA is assessed at between $500 per call to $1,500 per call. If an agency makes 20 calls a month for 3 months, the agency could be looking at exposure of $90,000.00! If these calls were made to a cellular telephone without the debtor having previously given consent to either the underlying creditor or the agency, the agency's exposure could quickly become catastrophic.
In order for a plaintiff to prevail under the TCPA, she must prove that the agency itself, made the alleged offending calls. See, 47 U.S.C. § 227b(1)(A). This is how the farming out of raw data, i.e, the telephone numbers to be called, to a third party who processes and then makes the calls could provide a very strong defense to any TCPA lawsuit. The TCPA, by its plain language, makes it unlawful for anyone “to make any call” without consent, to a cellular telephone, using an automatic telephone dialing system or an artificial or prerecorded voice. Id. But, the TCPA, by its express language limits liability under § 227b(1)(A) to those entities which actually make the calls.
Conversely, liability for calls made “on behalf of” another party under the TCPA is limited to repeated calls made in violation of the “Do Not Call” registry. See, 47 U.S.C. § 227(c)(5). The plain language of the TCPA clearly delineates the entity which has potential liability for autodialed or prerecorded calls to wireless numbers, to wit, those entities which “make” the calls, not those entities for whom the calls were made “on behalf of.” See, 47 U.S.C. § 227(b)(1) and (c)(5). As such, Congress specifically did not intend for the phrase “on behalf of” to apply to autodialed or pre-recorded calls to wireless numbers as shown by the absence of the phrase in § 227(b)(1).
In reviewing construction of a statute that a federal agency administers, a Court should answer two questions. Chevron U.S.A., Inc. v. Natural Res. Def. Council, Inc., 467 U.S. 837, 842-43 (1984). “First, as always, is the question whether Congress has directly spoken to the precise question at issue. If the intent of Congress is clear, that is the end of the matter; for the court … must give effect to the unambiguously expressed intent of Congress.” Id. “Only if the court determines Congress has not directly addressed the precise question at issue” should the court then ask the second question of “whether the agency’s answer is based on a permissible construction of the statute.” Id. at 843. “The judiciary is the final authority on issues of statutory construction and must reject administrative constructions which are contrary to clear congressional intent.” Id. at n. 9.
I believe that a Court’s inquiry must begin and end with the statutory text of the TCPA. Using basic tenets of statutory construction, Congress’ deliberate omission of the phrase “on behalf of” in § 227(b)(1) is particularly compelling. “Where Congress includes particular language in one section of a statute but omits it in another section of the same Act, it is generally presumed that Congress acts intentionally and purposely in the disparate inclusion or exclusion.” Russello v. United States, 464 U.S. 16, 23 (1983).
Noting the difference in language between the two sections of the TCPA, district courts which have addressed this precise issue have held that there is no “on behalf of” liability for defendants under § 227(b). See, Mey v. Pinnacle Sec., LLC., 2012 WL 4009718, at 3-4 (N.D. W.Va. Sept. 12, 2012); Thomas v. Taco Bell Corp., 879 F.Supp.2d 1079, 1084 (C.D. Cal. 2012); Mais v. Gulf Coast Collection Bureau, Inc., et al, No. 0-11-cv-61936-RNS (S.D. Fla. May 8, 2013).
If Congress had meant to impose liability beyond those who “make” autodialed calls to wireless numbers to those to whom the calls were made “on behalf of,” then Congress would have done so. See generally, Russello, 464 U.S. at 16. This is particularly true since Congress created two separate and distinct private rights of action under the TCPA. See, 47 U.S.C. § 227(b)(3) compared to § 227(c)(5). “We have included a private right of action for consumers harmed by automated or prerecorded calls and a different private right of action for consumers who receive telemarketing solicitations” 137 Cong.Rec. S18781-02 (daily ed. November 27, 2001 – statement of Rep. Hollings).
The first private right of action contemplates calls alleging automated or prerecorded calls. See, 47 U.S.C. § 227(b). The second private right of action acts as a restriction on repeated, unsolicited telemarketing calls. 47 U.S.C. § 227(c). In drafting the TCPA, Congress delineated “privacy rights to include the concepts of privacy invasion and nuisance.” See, 137 Cong.Rec. S18781-02.
Therefore, Congress imposed separate restrictions in separate subsections, one designed to address the nuisance created by autodialed and prerecorded messages, the other designed to apply to the privacy invasion attendant with repeated telemarketing solicitations upon those who have indicated a desire not to receive such messages. 47 U.S.C. §§ 227(b),(c). When Congress created two separate causes of action in the TCPA, Congress assigned differing scopes of liability for each cause. Id. If Congress intended for “on behalf of” liability to be read into the TCPA’s provision against autodialed and prerecorded calls, then Congress either would have made one cause of action with the same standard, or two causes of action with the same explicit standard of “on behalf of” liability. Nothing in the legislative history or the wording of the TCPA supports such interpretation.
The plain language of the TCPA leaves no doubt who is to be liable for autodialed or prerecorded calls to wireless numbers. This potential class of persons is limited to those entities which actually “make” the calls, not those for whom those calls were made “on behalf of.”
Those third parties which provide the software and hardware to process telephone numbers to be called, or are capable of performing a scrub to detect numbers assigned to wireless cellular telephone numbers, and who can provide call reports could be an invaluable resource that agencies should consider in their continuing efforts to stay compliant with all federal and state regulations. Granted, the services provided by those third parties will come at a cost reflective of the services they do provide.
And yet, how many TCPA claims and lawsuits must an agency endure before the costs equalize and the agency is staring down the barrel of financial armageddon?
As always, consult your local and trusted attorney for a greater, in depth analysis of your unique situation.
