Congress enacted the Telephone Consumer Protection Act (TCPA) in 1992 to attempt to limit the increasing volume of unwanted automated calls sent to consumers, especially bothersome prerecorded telemarketing calls.1 The TCPA thus contains an array of provisions designed to reduce such calls. For example, the TCPA gives the Federal Communications Commission (FCC) the authority to establish do-not-call lists2 and prohibits prerecorded telemarketing calls from being sent to a residential telephone number without the call recipient’s consent.3 But the TCPA also restricts the use of automated equipment to call cellular telephone numbers. Thus, it is
January 13, 2021 Feature
Don’t Call Me Anymore: Free Speech and Robocalls after Barr v. American Association of Political Consultants
By Kyle J. Steinmetz
unlawful for any person within the United States, or any person outside the United States if the recipient is within the United States . . . to make any call (other than a call made for emergency purposes or made with the prior express consent of the called party) using any automatic telephone dialing system or an artificial or prerecorded voice . . . to any telephone number assigned to a paging service, cellular telephone service, specialized mobile radio service, or other radio common carrier service, or any service for which the called party is charged for the call.4
Notably, while many other provisions of the 1992 TCPA applied only to marketing or telemarketing calls, this provision applied to all types of calls, including customer service calls, collection calls, survey calls, and calls by political campaigns to conduct polls or get out the vote. Moreover, the statute effectively imposes strict liability for calls that violate it (even if the calls were made in good faith) and imposes a minimum of $500 in statutory damages, with the potential for trebling the damages in the event of a “knowing or willful” violation.5
When Congress enacted the TCPA in 1992, cellular telephones represented a new technology, and most calls made by a legitimate business seeking to connect with their customer base went to the customer’s home phone number—not the customer’s cell phone. However, as more and more people have eschewed landlines for cellular telephones, a larger volume of calls has been directed at cellular telephone lines. That has led to an explosion of litigation under 47 U.S.C. § 227(b)(1)(A)(iii), including class action suits that, due to the high level of statutory damages, may impose millions of dollars in potential liability.
In 2015, Congress amended the TCPA and exempted calls “made solely to collect a debt owed to or guaranteed by the United States” from the scope of § 227(b)(1)(A)(iii).6 That amendment, however, privileges a particular form of commercial speech (i.e., debt collection work on a government account) by exempting it from the prohibitions on automated calls that apply to nearly all other callers. This, in turn, raises the issue of impermissible content-based discrimination—and gave an opening to the organizations whose ability to contact interested parties had been greatly hampered by the TCPA to potentially invalidate the law.
Litigation predictably ensued, and two circuit courts both found that the new exemption for government debt collection calls constituted impermissible content-based discrimination.7 Both circuit courts further agreed on the proper remedy to address the alleged free speech violation: rather than throw the baby out with the bathwater and invalidate the entire ban on automated calls to cell phones, the two lower courts simply struck the offending language exempting government debt collection calls, severing the exemption from the rest of the statute.8 Thus, despite finding a First Amendment violation, those courts fashioned a remedy under which all speech was further restricted, including the government debt collection work that Congress had attempted to exempt.
The Supreme Court granted certiorari in Barr v. American Association of Political Consultants. In June 2020, the Court issued its opinion that upheld the lower courts on both issues, striking down the exemption for government debt collection calls but severing the exemption and upholding the rest of the provision banning autodialed calls to cell phones.9
The Controlling Opinion
The Supreme Court’s decision was fractured, with no opinion receiving five votes in its entirety. Six justices ultimately found the government debt collection exemption unconstitutional, and a separate group of seven justices found that, assuming the provision was unconstitutional, it should be severed.
Justice Kavanaugh wrote the controlling opinion, joined only by Chief Justice Roberts and Justice Alito as to the whole opinion.10 He began by reaffirming what he saw as a fundamental distinction in First Amendment law—that while content-neutral “time, place, manner” restrictions are subject to a lower level of scrutiny, content-based restrictions on speech remain subject to strict scrutiny even in the context of a commercial regulation.11 Since the government debt collection exemption allowed robocalls in order to request payment on a government debt but forbade robocalls on other topics (such as making a political endorsement or collecting other debts), the exemption was “about as content-based as it gets.”12 The Court’s controlling opinion rejected the government’s argument that the exemption applied differential treatment based on a class of speakers (i.e., authorized government debt collectors) and not the content of the calls, because it did not apply to all calls made by the authorized debt collectors but only to those seeking to collect on a government debt.13
The exemption, then, was subject to strict scrutiny. The government conceded that it could not meet this exacting standard or show a compelling reason why collecting government debt and protecting the public fisc should take priority over other important categories of speech, including core political speech.14
Justice Kavanaugh’s opinion then addressed the question of an appropriate remedy. It found that Congress had “competing interests” in both collecting government debt and in protecting consumer privacy that led it to enact both the TCPA and the subsequent exemption for collecting government debt.15 The controlling opinion thus elected to sever the government debt collection exemption rather than invalidate the ban on automated calls to cell phones as a whole.16 In doing so, it relied on the fact that § 227(b)(1)(A)(iii) is contained within title 47, which encompasses the larger Communications Act, and includes a general severability clause applicable to that entire title.17 Moreover, even if the express severability clause of the Communications Act did not apply here, the Court found that it should apply a presumption of severability to uphold the broader law, which, after all, had functioned independently for years prior to the 2015 amendment that created the content-based discrimination at issue.18
Additional Opinions
Writing separately, Justice Sotomayor concurred in the judgment. While she would have applied intermediate scrutiny to the exemption instead of strict scrutiny, she concluded that the exemption failed to meet even this less exacting standard because the government had failed to justify the differential treatment between government debt collection calls and other forms of protected speech.19
In contrast, Justice Breyer, writing for himself, Justice Kagan, and Justice Ginsburg, dissented from the invalidation of the debt collection exemption. Justice Breyer criticized the use of strict scrutiny for content-based distinctions made in commercial regulations, and instead would apply only an intermediate level of scrutiny.20 In particular, his partial dissent found that since the regulation at issue had “next to nothing to do with the free marketplace of ideas or the transmission of the people’s thoughts and will to the government” but was instead a purely commercial regulation, strict scrutiny was not appropriate.21 The dissent found that the law satisfied the intermediate scrutiny standard in light of the government’s interest in protecting the public fisc and the modest restriction on speech at issue.22 These three judges, however, concurred in the Court’s severability analysis.23
Finally, Justice Gorsuch, writing for himself and, as to the severability analysis, for Justice Thomas, agreed with the majority’s use of strict scrutiny to invalidate the exemption.24 However, he would have gone further and enjoined the enforcement of the TCPA’s autodialer ban in its entirety as to individuals who engaged in other types of speech, rather than simply sever the exemption.25 The partial dissent argued that an injunction preventing enforcement of the TCPA against the plaintiffs is the traditional remedy when a regulatory statute runs afoul of the First Amendment.26 By contrast, the dissent argued that the remedy promulgated by the controlling opinion gave no relief at all for the named plaintiffs, who still found their speech restricted.27
What’s Next for the TCPA?
To some extent, the invalidation of the government debt exemption may be sound and fury, with little practical impact.28 The Supreme Court has already found that the TCPA does not apply to the federal government and strongly suggested that contractors may be able to claim derivative immunity from liability in appropriate circumstances.29 The FCC also accepted this approach in assessing TCPA liability for federal contractors, provided the contractors act as the government’s agent and pursuant to the government’s instructions and authority.30 Thus, if debt collectors include clear provisions in their contracts with the federal government that they are acting as agents and not independent contractors, and if those contracts authorize them to use autodialers or a prerecorded voice even if they do not have the customer’s express consent, collection agencies may be able to continue collecting on government debts with a limited risk of TCPA liability by relying on their derivative immunity as federal contractors.31
As to other companies impacted by § 227(b)(1)(A)(iii)’s broad reach, they have another chance to limit the statute’s reach in a case before the Supreme Court this term. Section 227(b)(1)(A)(iii) does not ban all calls to cellular telephone numbers but instead applies only to those calls that use a prerecorded voice or an automatic telephone dialing system (ATDS).32 The TCPA defines the term ATDS as “equipment which has the capacity to store or produce telephone numbers to be called, using a random or sequential number generator; and to dial such numbers.”33
The definition of “ATDS” poses a knotty statutory interpretation question around what part of the definition the phrase using a random or sequential number generator modifies—just the verb to produce or both verbs, to store and to produce. Under the first interpretation, most dialing systems that dial from a list of customer numbers would be covered by the statute because they “store” numbers, even though they do not generate random or sequential numbers. Under the second interpretation, equipment that dials from a list of numbers (like the systems presumably used by most companies to contact their customers) may not fall within the statute because those systems do not involve random or sequential number generation.
This question has split the circuits,34 and, in July 2020, the Supreme Court granted certiorari to resolve the split, with oral argument to occur in December.35 The scope of the TCPA, then, will remain front and center at the Court for at least one more term.
Endnotes
1. 47 U.S.C. § 227 et seq.
2. Id. § 277(c)(1)–(3); 47 C.F.R. 64.1200(d).
3. 47 U.S.C. § 227(b)(1)(B).
4. Id. § 227(b)(1)(A)(iii).
5. Id. § 227(b)(3).
6. Barr v. Am. Ass’n of Pol. Consultants, Inc., 140 S. Ct. 2335, 2343 (2020).
7. Am. Ass’n of Pol. Consultants, Inc. v. FCC, 923 F.3d 159 (4th Cir. 2019); Duguid v. Facebook Inc., 926 F.3d 1146 (9th Cir. 2019).
8. Am. Ass’n of Pol. Consultants, 923 F.3d at 171; Duguid, 926 F.3d at 1156–57.
9. Barr, 140 S. Ct. at 2343.
10. Justice Thomas joined the portion of the opinion finding the exemption invalid but, as discussed infra, argued that the entire ban on autodialed calls to cell phones should have been struck down.
11. Barr, 140 S. Ct. at 2346.
12. Id.
13. Id. at 2347.
14. Id.
15. Id. at 2348–49.
16. Id. at 2349.
17. Id. at 2352.
18. Id. at 2353.
19. Id. at 2356–57 (Sotomayor, J., concurring).
20. Id. at 2358–59 (Breyer, J., dissenting in part and concurring in part).
21. Id. at 2359.
22. Id. at 2362–63.
23. Id. at 2363.
24. Id. (Gorsuch, J., dissenting in part and concurring in part).
25. Id. at 2365.
26. Id. at 2365–66.
27. Id. at 2366.
28. Notably, at least two federal courts have concluded that for claims that relate to the period in which the government debt exception was in effect and not yet severed by the Supreme Court, defendants can still mount a First Amendment challenge. Lindenbaum v. Realgy LLC, 2020 WL 6361915 (N.D. Ohio Oct. 29, 2020); Creasy v. Charter Communications Inc., 2020 WL 5761117 (E.D. La. Sept. 28, 2020).
29. Campbell-Ewald Co. v. Gomez, 136 S. Ct. 663, 673 (2016).
30. In re Rules and Regulations Implementing the Telephone Consumer Protection Act of 1991: Broadnet Teleservices LLC Petition for Declaratory Ruling, 31 FCC Rcd. 7394, 7401–02 (July 5, 2016) [hereinafter Broadnet ruling].
31. Prior to the Barr decision, the FCC had requested comments on the interplay between the government debt collection exemption and the Broadnet ruling, but it has not issued an order on that topic. See Public Notice, 33 FCC Rcd. 4864 (May 14, 2018).
32. 47 U.S.C. § 227(b)(1)(A)(iii).
33. Id. § 227(a)(1).
34. Compare Gadelhak v. AT&T Servs. Inc., 950 F.3d 458 (7th Cir. 2020), and Glasser v. Hilton Grand Vacations Co., 948 F.3d 1301 (11th Cir. 2020), with Marks v. Crunch San Diego, 904 F.3d 1041 (9th Cir. 2018), and Duran v. La Boom Disco, Inc., 955 F.3d 279 (2d Cir. 2020), and Allan v. Pa. Higher Educ. Assistance Agency, No. 19-2043, 2020 WL 4345341 (6th Cir. July 29, 2020).
35. Facebook Inc. v. Duguid, No. 19-511 (U.S. June 13, 2019).