Courts No Longer Follow the FCC on TCPA Litigation – Here’s What That Means for Your Business.

The Telephone Consumer Protection Act (TCPA) is the primary federal law governing how businesses engage with consumers through phone calls, text messages, and faxes. The TCPA includes limitations on the circumstances under which businesses may contact consumers (including how often and when) and may use an auto-dialer. Noncompliance can result in significant fines, including statutory damages of up to $1,500 per violation.

The TCPA applies whenever a company contacts a consumer via phone, text, or even fax. A company can also be held liable for violations committed by vendors (like telemarketers) that act on a company’s behalf.

The Supreme Court recently held, in McLaughlin Chiropractic Associates, Inc. v. McKesson Corporation, that courts are not required to follow the Federal Communications Commission’s interpretation of the TCPA. This decision expands the major questions doctrine, a relatively new legal theory that prohibits Congress from delegating questions of major political or economic significance to executive agencies without sufficiently clear and explicit authorization. The practical impact of the Supreme Court’s decision is an increase in litigation risk for businesses, given the potential for inconsistent rulings across states. Some of the key areas where courts may now diverge on TCPA include:

• Whether the term “telephone call” includes text messages,
• Whether Do-Not-Call (DNC) rules apply to cell phones,
• How to determine who “initiated” a call, especially with outsourced vendors,
• Whether AI-generated or prerecorded voice systems are subject to restrictions, and
• What qualifies as “written consent” for commercial communications?

The answers to these and other questions may depend  on the business’s geographic location. Potential side effects include businesses clustering in certain states, increase in forum shopping, and additional litigation.

At goodcounsel, we frequently advise businesses on how to navigate compliance challenges. We’re here to help you understand and manage risks, and keep your customer engagement strategies on solid legal footing. Contact us if you have any questions or want legal advice for your business.

Categorised as: Regulatory alert