The waiting game: Nearly 30 years later, companies lack meaningful regulatory guidance on the TCPA and ADA

Eversheds Sutherland (US) LLPOver the past eight years, the number of cases filed in courts across the country alleging violations of the Telephone Consumer Protection Act (TCPA) has more than quadrupled, with thousands filed each year. In 2018, another strict liability statute, the Americans with Disabilities Act (ADA), gave rise to more than 1,000 putative class actions based on allegations that defendants’ websites fail to provide effective communication for users with disabilities. The filing of new complaints under both statutes has continued unabated in 2020. 

What do these two seemingly unrelated statutes (and the thousands of lawsuits alleging violations of each) have in common? A lack of regulatory guidance from executive branch agencies, which has consequently left enforcement of these statutes largely in the hands of plaintiffs’ counsel. While thousands of defendants from every industry segment face a tsunami of lawsuits, the federal agencies principally responsible for promulgating regulations and guidance to these statutes—the Federal Communications Commission (FCC) for the TCPA, and the Department of Justice (DOJ) for the ADA—have sat by, effectively silent. 

The law, like nature, abhors a vacuum. Filling the vacuum created by this regulatory inaction are the courts, which have struggled to establish consistent interpretations of the statutes. The lack of consistency has opened the door for private plaintiffs’ attorneys to reap hundreds of millions of dollars in class action settlements at the expense of companies, large and small, that have struggled to comply with inexact standards and amorphous rules. 

Enacted in 1991 to protect consumers from unsolicited telemarketing calls and faxes (and more recently text messages), the TCPA specifically prohibits the use of an automatic telephone dialing system (ATDS) or an artificial or prerecorded voice to make calls to cell phones without obtaining the recipient’s prior express consent.1 These restrictions apply to both telemarketing and non-telemarketing calls, including debt collection and informational calls. The TCPA, as interpreted by the FCC, also requires prior express written consent for most automated telemarketing communications, particularly those made to cell phones.2 The technology that defined an ATDS in 1991 is far different (and in some ways unrecognizable) from today’s technology, yet the same statute enacted almost three decades ago applies today. In addition, when the statute was enacted there were no issues with or statistics on reassigned cell phone numbers; that industry was in its infancy. Today, the FCC estimates that as many as 100,000 cell phone numbers are reassigned every day. That alone creates enormous problems for entities trying in good faith to contact consumers, believing they have consent from the cell phone’s owner only to learn—usually when hit with a class action lawsuit—that the cell phone number had been reassigned, and they did not have the requisite consent to place the call. Enormous potential liability attaches to these class actions, as the TCPA provides for statutory damages of $500 per violation, trebled for willful conduct, plus attorneys’ fees, and no maximum cap on recovery.

Separately, Title III of the ADA, enacted a year before the TCPA in 1990, prohibits discrimination against people with disabilities, including the blind and visually impaired, in places of public accommodation.3 As originally enacted thirty years ago, before the Internet became ubiquitous and back when we still read hardcover books and did not have the everyday luxury of online shopping, the ADA did not expressly include websites as places of “public accommodation.” Over the years, however, as accessing goods and services via the Internet has become more commonplace, courts have interpreted places of “public accommodation” to include websites. No formal technical standards have been adopted to guide web developers on how to make websites ADA-compliant. The DOJ, the agency responsible for implementation and enforcement of the ADA, has yet to provide any formal guidance on the application of Title III to websites. While companies wait for that guidance, plaintiffs have filed a veritable tsunami of ADA class action lawsuits.

The FCC’s Guidance (or Lack Thereof) on the Definition of ATDS
The TCPA defines the term ATDS as “equipment which has the capacity—(A) to store or produce telephone numbers to be called, using a random or sequential number generator; and (B) to dial such numbers.”4 At first blush, this statutory definition seems clear enough, but the TCPA’s statutory language does not account for or address contemporary issues presented by current and emerging telecommunications technology. The incongruity between the language of the statute and the technology being used today poses a challenge for companies trying to comply with the TCPA. 
Almost five years ago, in July 2015, the FCC issued its Omnibus TCPA Declaratory Ruling and Order and tried to fill the gap by expanding the definition of ATDS to include devices with the capability or “capacity to store or produce telephone numbers to be called, using a random or sequential number generator, and to dial such numbers,” even if the device is not actually used as an ATDS.5 The FCC offered the following example to explain when a device may have the “capacity” to autodial: “[I]t might be theoretically possible to modify a rotary-dial phone to such an extreme that it would satisfy the definition of ‘autodialer,’ but such a possibility is too attenuated for us to find that a rotary-dial phone has the requisite ‘capacity’ and therefore is an autodialer.”6 By resorting to comparisons with rotary phones, rather than giving real-world examples, the FCC left businesses without a practical roadmap for applying the law to modern communication technology. 
The FCC’s unclear and overbroad definition of autodialer was soundly rejected in 2018 by the US Court of Appeals for the DC Circuit, in ACA International v. FCC. The court held that the FCC’s definition was beyond the scope of Congressional intent, leading to a potentially “eye-popping sweep” of the statute under which every smartphone could conceivably qualify as an ATDS.7 The DC Circuit also found the 2015 Order to be inherently contradictory; on one hand, the FCC indicated that a device must be able to generate random or sequential numbers that the device can then dial, while on the other hand also suggested that a device need only dial from a set list of numbers to constitute an ATDS.8
Following the DC Circuit’s 2018 ACA International decision, the FCC opened a public comment period inviting input on how the term ATDS or autodialer should be defined. A supplemental comment period followed thereafter in light of the Ninth Circuit ATDS decision in September 2018, Marks v. Crunch San Diego, LLC, which provided an expansive ATDS interpretation more aligned with the FCC’s 2015 Order.9 A year and a half has passed since the FCC ended its supplemental comment period, but no further guidance has been issued. At the end of March 2020, FCC Commissioner Michael O’Rielly, one of three Commissioners who comprise the political majority at the FCC, expressed his ongoing concern over the FCC’s failure to-date to provide a cogent working definition of autodialer, stating “the [FCC] must stop allowing legitimate callers to be unfairly punished by statutory misinterpretation and frivolous litigation.”10

The DOJ Has Yet to Issue Technical Guidance Regarding Website Design and Compliance with the ADA.
Real estate developers know to the inch the required width of a curb cut or height of a handrail they need to follow in order to comply with the ADA. But website developers and online businesses offering goods and services to the public have no such bright line technical guidance to determine whether a website provides effective communication as required by the ADA. Given that nearly every commercial business maintains a website, this lack of guidance is a significant problem.
An Advanced Notice of Proposed Rulemaking released in 2010 suggested that the DOJ intended to adopt the Web Accessibility Initiative Web Content Accessibility Guidelines (WCAG) 2.0, which are private industry standards, as the accessibility technical standard for websites covered by Titles II and III of the ADA. The DOJ repeatedly set (and delayed) release dates for the final Notice of Proposed Rulemaking concerning the adoption of WCAG 2.0. Ultimately, the proposed rulemaking was withdrawn on December 26, 2017, and no alternative proposed rules or guidelines have since been issued by the DOJ. In June 2018, members of the US House of Representatives urged the DOJ to help provide clarity regarding website accessibility standards under the ADA as soon as possible. On September 25, 2018, the DOJ provided the following as of part its response: “Absent the adoption of specific technical requirements for websites through rulemaking, public accommodations have flexibility in how to comply with the ADA’s general requirements of nondiscrimination and effective communication. Accordingly, noncompliance with a voluntary technical standard for website accessibility does not necessarily indicate noncompliance with the ADA.” The DOJ has failed to heed these directives, however, leaving companies to figure out the rules for themselves.
A Clarion Call for Action
In these two areas, the FCC and DOJ have abdicated their roles by failing to provide meaningful guidance under the TCPA and ADA. Allowing the status quo to continue puts a burden on businesses, in both compliance and litigation expenses, who are seeking to comply with these laws. It has allowed to flourish what one judge, who recently dismissed a series of ADA-related cases, called a cottage industry of copy and paste litigation.11
How much longer must companies be forced to operate in the dark, not knowing whether the sending of a text message will expose them to a class action lawsuit? How much longer must companies that offer goods and services via the Internet go without knowing whether their websites provide effective communication as measured by an objective standard and be subject to frivolous lawsuits? The time for the FCC and DOJ to act was years ago, but we will accept now as a substitute—better late than never. 
1  47 U.S.C. § 227(b)(1)(A)-(B).
2  47 C.F.R 64.1200(a).
3 42 U.S.C. § 12182.
4  47 U.S.C. § 227(a)(1).
5  See 30 F.C.C. Rcd. 7961, 7978 ¶ 24 (2015).
6  Id. at 7975 ¶ 18.
7  See ACA Int’l v. FCC, 885 F.3d 687, 697 (D.C. Cir 2018).
8  See id. at 702-03.
9  See 904 F.3d 1041 (9th Cir. 2018).
10  Statement of Commissioner Michael O’Rielly Re: Call Authentication Trust Anchor, WC Docket No. 17-97; Implementation of TRACED Act Section 6(a)—Knowledge of Customers by Entities with Access to Numbering Resources, WC Docket No. 20-67 (Mar. 31, 2020).
11  Dominguez v. Banana Republic, LLC, --- F. Supp. 3d ---, No. 1:19-cv-10171-GHW, 2020 WL 1950496 (S.D.N.Y. Apr. 23, 2020). 

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