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INSIGHT: FCC Robocall Ruling Aims to Thwart Coronavirus Telemarketing

April 6, 2020, 8:01 AM

Companies need to communicate rapidly and efficiently with customers, employees and others about the Covid-19 pandemic’s health risks and the critical mitigation efforts the companies are taking, but automated outreach by call or text may put companies at risk for hundreds of millions—even billions—of dollars in statutory damages under the Telephone Consumer Protection Act.

The Federal Communications Commission has recognized that fear of TCPA liability should not inhibit necessary calls regarding the Covid-19 pandemic. On March 20 the agency issued a declaratory ruling addressing the applicability of the statute’s emergency purposes exception to calls by hospitals, other health-care providers, and government officials.

However, the declaratory ruling is limited in scope. In answering one set of questions, it raises others.

Statutory Background

Absent prior express consent from the called party, the TCPA generally prohibits calls or texts to cell phones using an automatic telephone dialing system and calls to cell phones or residential phones using an artificial or pre-recorded voice.

The FCC has exempted informational calls to residential phones that do not include an advertisement or constitute telemarketing. For telemarketing or advertising calls, consent must be written.

Mistakes can be costly, even ruinous; statutory damages are $500 to $1,500 per violation—that is, for each offending call or text.

The ‘Emergency Purposes’ Exception

Congress recognized that the TCPA’s restrictions should not impede communications in an emergency. The TCPA contains an exception to its consent requirements for calls made for “emergency purposes.” The FCC defines “emergency purposes” to mean “calls made necessary in any situation affecting the health and safety of consumers.”

As the definition highlights, the exception applies to “any situation” affecting “health and safety,” rather than a narrow list of circumstances, but the calls must be “necessary,” rather than extraneous.

FCC Ruling Has Narrow List of Permitted Callers

The FCC’s new ruling seeks to clarify the scope of the emergency purposes exception amid the Covid-19 pandemic. Acknowledging that “the current pandemic” constitutes an “emergency,” and that “effective communications” are “critical” to slow the spread of the coronavirus, the FCC ruled that “certain callers” may rely on the emergency purposes exception to make calls and send texts when “necessary to protect the health and safety of citizens.”

But the ruling has a narrow list of permitted callers. The calls must be “from a hospital … healthcare provider, state or local health official, or other government official” or someone acting under the “express direction” of such an actor and on its behalf.

The calls must be “solely informational, made necessary because of the COVID-19 outbreak, and directly related to the imminent health or safety risk arising out of the COVID-19 outbreak.”

By providing a list of qualifying callers, did the FCC intended to foreclose reliance on the emergency purposes exception by other callers? We do not believe so. One should read the ruling in light of the FCC’s specific and immediate goal “to ensure that public health authorities can efficiently and effectively communicate vital health and safety information to the American people.”

The FCC provides no indication that it intended to revoke its prior guidance on emergency purposes calls by other types of callers. The declaratory ruling cites with approval a 2016 ruling applying the exception to protect automated calls by schools about weather closures and unexcused absences.

There is no reason why a call by an employer to its staff regarding an office closure due to the pandemic should be treated differently than a call by a school to parents about a school closure due to a storm.

It is not only hospitals, health-care providers and government officials who may need to convey “necessary” information affecting “the health and safety of consumers,” and other actors should be able to rely on the emergency purposes exception to do so.

Telemarketers Beware

The declaratory ruling excludes from the exception “calls that contain advertising or telemarketing of services,” such as “advertising a commercial grocery delivery service, or selling or promoting health insurance, cleaning services, or home test kits.” The FCC has consistently expressed concern that the emergency purposes exception not swallow the TCPA’s restrictions on telemarketing.

Companies seeking to communicate about the pandemic should cast a critical eye on their proposed messages. Does the call communicate “necessary” and time-sensitive information about health and safety? Or will it be viewed as merely telemarketing in disguise?

That the message relates to a product for sale is a relevant but not disqualifying factor. Courts have recognized, for example, that a pharmacy’s communications to patients about their prescriptions (such as refill reminders) qualify as emergency purposes calls because helping patients stay on their medications affects their health and safety.

But the FCC warns in the ruling that it will remain vigilant to protect consumers from unwanted robocalls “preying on virus-related fears” to sell products. Moreover, the TCPA plaintiffs’ bar is not going away.

While fear of TCPA liability should not chill necessary informational alerts to protect consumer health and safety, companies looking to exploit the pandemic as a loophole for telemarketing may find themselves vulnerable to a TCPA class action.

This column does not necessarily reflect the opinion of The Bureau of National Affairs, Inc. or its owners.

Author Information

Bradley J. Andreozzi is a partner in the Chicago office of Faegre Drinker Biddle & Reath LLP. He defends class actions at trial and on appeal, including shareholder and consumer class actions. He has defended TCPA class actions involving the “emergency purposes” exception discussed here.

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