Fax Advertisements Must Contain TCPA Opt-Out Language

FaxOn May 21, 2013, the United States Court of Appeals for the Eighth Circuit issued a decision that troubled the very judges who wrote it.  In a case involving the Telephone Consumer Protection Act of 1991 (the “TCPA”), the Circuit Court ruled that permissive, or “consented to” facsimile (“fax”) advertisements (that is, where the sender has the express permission of the recipient to send a fax advertisement), must contain certain TCPA opt-out language prescribed by the Federal Communications Commission (“FCC”) even though the TCPA, on its face, only applies to unsolicited fax advertisements.

Although the facts of the case are limited solely to fax advertisements, the implications of the ruling may be widespread.  To the extent restaurants or real estate brokers, by way of example, send a fax advertisement at the request of the recipient, they may create liability for themselves under the TCPA if such faxes do not contain the FCC’s mandated opt-out language.

Nack v. Walburg

In Nack v. Walburg, the United States District Court for the Eastern District of Missouri dismissed a class action complaint where the named plaintiff had consented to the receipt of a fax advertisement, but the fax advertisement itself failed to include certain “opt-out” language mandated by FCC rule.  The District Court was troubled because the FCC rule, on its face, applied to all fax advertisements even though the express language of the TCPA limited the scope of the law to fax advertisements sent without the consent of the recipient.

At the time the District Court rendered its decision, the FCC had released inconsistent statements as to the scope of the rule, but had not released an official interpretation of the TCPA opt-out notice requirement.  As a result, the district court relied on certain statements in the FCC’s May 3, 2006 Rules and Regulations Implementing the [TCPA] of 1991.  The District Court held that the TCPA opt-out notice requirement could only apply to cases where the recipient of the fax advertisement did not give consent to the receipt of such faxed advertisement.

The FCC and Eighth Circuit Court of Appeals Weigh In on TCPA Opt-Out Requirements

After an initial round of oral argument on the appeal of the district court’s dismissal of the class action, the Eighth Circuit invited the FCC to submit an amicus brief advancing its interpretation of the rule.  For the first time, the FCC took the position that the TCPA opt-out notice requirement applies to all fax advertisements even though the clear application of the TCPA targets unsolicited faxes.  As a result, the Eighth Circuit followed the opinion of the agency charged with rules enforcement and reversed and reinstated the class action.  In its decision, the Eighth Circuit stated:

[B]ased on the FCC’s interpretation . . . we must reverse the grant of summary judgment.  The Administrative Orders review Act (“Hobbs Act”) . . . precludes us from entertaining challenges to the regulation other than on appeals arising from agency proceedings . . . .  Without addressing such challenges, we may not reject the FCC’s plain-language interpretation of its own unambiguous regulation.  Our reversal today, therefore, places the parties back before the district court where [defendant] faces a class-action complaint seeking millions of dollars even though there is no allegation that he sent a fax to any recipient without the recipient’s prior express consent.

Accordingly, even though the Eighth Circuit ultimately agreed that the rule appears to exceed the scope of the TCPA, it ruled that companies (or individuals, as applicable) may be liable for sending fax advertisements without the prescribed opt-out notice, even in instances where the recipient had provided consent to the receipt of such faxed advertising.

Take Precautions

In light of this ruling, it is critical that any advertisements sent via fax, even if a consumer calls the business on his/her own and requests receipt of such fax, contain the FCC prescribed opt-out language.

If you are interested in learning more about this topic or if you have been served with legal process relating to the TCPA, please e-mail us at info@kleinmoynihan.com or call us at (212) 246-0900.

The material contained herein is provided for informational purposes only and is not legal advice, nor is it a substitute for obtaining legal advice from an attorney.  Each situation is unique, and you should not act or rely on any information contained herein without seeking the advice of an experienced attorney.
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