The Federal Communications Commission (FCC) has set forth final rules pursuant to the federal Pallone-Thune Telephone Robocall Abuse Criminal Enforcement and Deterrence Act (TRACED Act), allowing for further civil forfeiture penalties for certain Telephone Consumer Protection Act (TCPA) violations. The FCC’s rules were first adopted in an FCC order on May 1, 2020. The rules were published in the Federal Register on June 26, 2020, and become effective on July 27, 2020.
The TRACED Act became law on December 30, 2019, and provides consumer protections against robocalls, most notably through enhanced penalties and additional time for the FCC to bring certain enforcement actions. This alert serves as an update to our prior alert on the TRACED Act, which is available here.
The new rules amend the FCC’s current rules on forfeiture proceedings to reflect the legislative changes that the TRACED Act made to the TCPA. The TRACED Act amended the TCPA in several respects, which the FCC has now adopted in its amended regulations (47 CFR § 1.80), such as:
- Removing the requirement that the FCC must first issue a citation to alleged violators of Section 227(b) of the TCPA who do not have an FCC-issued license, permit, certificate, or other authorization or who are not applicants for such authorization before the FCC can seek to impose a forfeiture penalty against such violators. Section 227(b) of the TCPA generally relates to the use of an automatic telephone dialing system or artificial or prerecorded voice.
- Adding civil forfeiture penalties with respect to intentional violations of Section 227(b) of the TCPA.1 Per the TRACED Act and the FCC’s new rules implementing the Act, those who the FCC finds to have violated Section 227(b) of the TCPA with intent may face a potential penalty up to $10,000 per intentional unlawful robocall. This is in addition to the existing penalties under the Communications Act (47 U.S.C. § 503(b)), which generally imposes liability for various activity, including certain willful or repeated violations with respect to holding an FCC license or other type of FCC-issued authorization as well as violations of telecommunications requirements, such as those involving broadcasting.2
- Increasing the statute of limitations for the FCC to bring an enforcement action for intentional violations of Section 227(b) of the TCPA from one year to four years.
- Increasing the statute of limitations for the FCC to bring an enforcement action relating to violations of Section 227(e) of the TCPA (Truth in Caller ID Act, relating to unlawful “spoofing” activity) from two years to four years.
The FCC considered its adoption of the new rules to be “largely ministerial” given that the FCC found its action to “simply effectuate[] regulations established by legislation and require[] no exercise of administration discretion.” Therefore, the FCC adopted the rules without a notice and comment period, finding that the rules’ adoption fell within the “good cause” exception to the Administrative Procedure Act.3
Conclusion
The impact of the TRACED Act and the FCC’s rules implementing its legislative changes, including how aggressively the FCC may pursue enforcement actions and penalties, largely remains to be seen, as the TRACED Act continues to add to the robust regulatory framework surrounding the TCPA.
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1 As a general matter, the TRACED Act allows for civil forfeiture penalties (under a 1-year statute of limitations) to be added on top of any other statutory penalty with an additional $10,000 in penalties (under a 4-year statute of limitations) for intentional violations.
2 See 47 U.S.C. § 503(b)(1).
3 May 1, 2020 FCC Order available here.
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