In a win for the American Bankers Association and other industry stakeholders, a federal appellate court today set aside some of the Federal Communications Commission’s constraints on when and how businesses can contact customers by phone. The FCC’s expansive interpretations under the Telephone Consumer Protection Act had created compliance challenges for banks seeking to contact their customers with important account information.
The three-judge panel of the D.C. Circuit Court of Appeals ruled that the FCC’s definition of an autodialer was “unreasonably expansive,” since it would appear to cover ordinary smartphones, not just equipment designed to make robocalls. The court also vacated the FCC’s policy on calls made to numbers belonging to people who had consented to receive calls but that had since been reassigned to non-consenting persons; the court said that the FCC’s safe harbor (which allowed only one call before incurring liability) was arbitrary and capricious. The court upheld the FCC’s approach to handling how call recipients can revoke previously granted consent to calls but concluded that a caller and call recipient may contractually agree to specific revocation mechanisms.
The court ruled mostly in line with the argument made by ABA, the Credit Union National Association and the Independent Community Bankers of America in a friend-of-the-court brief filed in December 2015. ABA and the other groups emphasized that financial institutions must communicate with their customers quickly and efficiently in order to prevent and mitigate fraud and identity theft, to help customers avoid unnecessary fees and provide customer service — and that the FCC’s overbroad constraints under TCPA would hinder those communications.
With today’s decision, the FCC has an opportunity to revisit TCPA regulations to make sure that they meet the evolving communications needs of today’s customers. ABA continues to lead industry efforts to engage with FCC officials. For more information, contact ABA’s Jonathan Thessin.