FCC Declares Overly-Broad Absolute Liability for Unsolicited Faxes under the TCPA?

Print Friendly, PDF & Email

TCPAIn response to an invitation from the United States Court of Appeals for the Eleventh Circuit concerning a question involving the interpretation of the Telephone Consumer Protection Act (“TCPA”), the Federal Communications Commission (“FCC”) filed a letter brief in Court on July 17, 2014, declaring that “under the plain text of [the Code of Federal Regulations (“CFR”)] – and unlike the robo-call and do-not-call contexts – direct liability for sending an unsolicited facsimile advertisement attaches to the entity (defined as the ‘sender’) whose goods or services are being promoted, and not generally to the entity that physically transmits the facsimile.”  Although the FCC used the term “direct liability,” the statutory interpretation that it proposes is overly-broad and appears contrary to a plain reading of the text of the Act.  It is now up to the Eleventh Circuit to either adopt or reject the FCC’s interpretation.

The Alleged TCPA Fax Violation

The underlying facts of the subject litigation are not complex.  The plaintiff, a golf center in Palm Beach, brought an action under the TCPA against a dental office, alleging that the defendant had sent it an unsolicited advertisement via facsimile in December 2005.  The defendant had retained an independent contractor to perform marketing services on its behalf.  That contractor, in turn, retained a third party, Business to Business Solutions (“BTB”), to send its clients’ advertisements via telecopier.  BTB sent the fax at issue, but the plaintiff sued the dental office.  The district court granted the dental office summary judgment, dismissing the TCPA claims.  The court determined that the defendant can only be held vicariously liable, at most (and not directly liable), under the facts at issue.  The plaintiff appealed to the Eleventh Circuit, and the Eleventh Circuit solicited the FCC’s opinion on the question at issue.

The FCC’s Position 

In its letter brief, the FCC initially argued that the district court erred in relying on its opinion in In re Joint Petition by Dish Network LLC (“Dish Network”) (For more information, see FCC Issues New TCPA Ruling on Telemarketing Liability).  In the Dish Network opinion, the FCC stated that under the TCPA, a seller can only be vicariously liable for telephone calls placed on its behalf by a third-party telemarketer.  However, according to the FCC, its reasoning in the Dish Network opinion cannot be applied to faxes sent in violation of the TCPA.  Instead, according to the FCC, “so long as the transmitted fax constitutes an unsolicited facsimile advertisement promoting the defendant’s goods or services,” the defendant will be directly liable, even if the facsimile was sent without its knowledge or authorization.

In opposition to the FCC’s interpretation, the defendant in the action responded as follows:

If all a plaintiff need show for its cause of action under [the TCPA] is receipt of “an unsolicited facsimile advertisement promoting the defendant’s goods or services,” fax broadcasters could subject companies to crushing liability by taking a ream of paper from a company’s work[place], creating a promotion on the company’s letterhead and blasting the advertisements to every fax number in the state.  This is not strict liability; it is absolute liability.

It is now up to the Eleventh Circuit to either adopt or reject the FCC’s interpretation.  Although the FCC argued that the Court “must apply” its interpretation, the defendant has suggested that the FCC is entitled to no deference because rather than an interpretation, the FCC’s letter brief created new law.

Protect Yourself Against TCPA Liability

If courts around the country adopt the FCC’s reasoning on seller direct liability for unsolicited faxes, the effect could be far reaching.  Companies, as well as third-party marketers, could suffer as a result.  We will continue to monitor this action and provide an update once the Eleventh Circuit issues a ruling.

If you are interested in learning more about this topic, or if you have been served with legal process relating to the TCPA or Junk Fax Prevention Act, 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.

Attorney Advertising

David O. Klein

David O. Klein

David Klein is one of the most recognized attorneys in the telemarketing, technology, Internet marketing, sweepstakes and telecommunications fields. Skilled at counseling clients on a broad range of technology-related matters, David Klein has substantial experience in negotiating and drafting complex licensing, marketing and Internet agreements.

Schedule a Call
In The Know

Trending Topics

Creating a Viral and Legally Compliant "Pin to Win" Contest- Klein Moynihan Turco

Creating a Viral (And Legally Compliant) “Pin to Win” Contest

Print Friendly, PDF & Email

We have frequently written about the marketing benefits associated with the use of promotional contests and sweepstakes.  Promotional contests and sweepstakes often appear on social media platforms, which provide companies with a free and effective means to increase the number of consumers participating in their respective contests. While companies must

Facebook Decision defines a TCPA Autodialer- Klein Moynihan Turco LLP

Facebook Aftermath: Courts Clarify Definition of TCPA Autodialer

Print Friendly, PDF & Email

On April 1st, the U.S. Supreme Court released its opinion in Facebook, Inc. v. Duguid, marking a newly clarified definition of “autodialer” within the meaning of the Telephone Consumer Protection Act (“TCPA”). In the two weeks that followed, two federal courts have directly addressed the definition of TCPA autodialer as

Critical Role that TCPA Plays in Outbound Telemarketing- KMT

The Critical Role that the TCPA Plays in Outbound Telemarketing

Print Friendly, PDF & Email

If you’re running any sort of outbound telemarketing campaign – phone calls, voicemail drops, or text messaging – you need to understand the Telephone Consumer Protection Act (TCPA) and its enabling regulations. Call center operators are not the only businesses that employ outbound telemarketing to reach out to consumers. Using

How to Use Promotional Marketing the Legal Way: Klein Moynihan Turco LLP

How To Use Promotional Marketing The Legal Way

Print Friendly, PDF & Email

The use of promotional contests, games and sweepstakes marketing can be a dynamic and cost-effective way to increase sales, build a database of interested consumers and otherwise increase brand awareness and buzz. Consumers are more easily attracted to your marketing message by the opportunity to win prizes than with more

Running a Telemarketing Business?

Get a Free Compliance Review From an Experienced TCPA Lawyer.

Share on facebook
Share on google
Share on twitter
Share on linkedin