FCC Solicited Fax Rule Unlawful, DC Circuit Rules, With a Dissent

Court of Appeals for the D.C. Circuit panel ruled Friday, with one judge dissenting. In the opinion, written by Judge Brett Kavanaugh, the court said the act requires an opt-out notice on unsolicited fax ads, but it doesn't do the same for solicited ones, with Congress clearly demarcating between the two. It said the FCC defense "has it backwards" in suggesting an agency can take an action as long as it's not prohibited by Congress: "Congress has not authorized the FCC to require opt-out notices on solicited fax advertisements. And that is all we need to know to resolve this case." The D.C. Circuit ruled the order vacated and remanded to the agency and dismissed petitions challenging FCC waivers given to fax ads sent before April 30, 2015, as moot. Raymond Randolph also joining in the majority decision. Numerous businesses challenged the rule (see 1408040030). In a dissent, Judge Cornelia Pillard said the FCC was reasonable in deciding opt-out notices are needed on all fax ads and that the court's opinion will put extra burdens on recipients trying to control their fax traffic, "precisely the sort of anti-consumer harm Congress intended to prevent." In a statement, Chairman Ajit Pai said the ruling "highlights the importance of the FCC adhering to the rule of law." He said he dissented from the 2014 order reaffirming the notice requirement (see 1410300047) "because, as I stated at the time, the agency’s approach to interpreting the law reflected ‘convoluted gymnastics.’ The court has now agreed that the FCC acted unlawfully. Going forward, the Commission will strive to follow the law and exercise only the authority that has been granted to us by Congress.” With the ruling, the D.C. Circuit "has shown that it is willing to take a hard look at the FCC’s [Telephone Consumer Protection Act] decisions, especially when they are difficult to square with the statute’s text or the practical realities that businesses face," said telecom lawyer Mark Brennan of Hogan Lovells, adding that there now will be increased attention on ACA v. FCC, "another TCPA case pending before the D.C. Circuit that involves the FCC’s interpretation of the term ‘automatic telephone dialing system’ and framework for calls to reassigned wireless numbers.” Friday's decision "reconfirms the proper and appropriate reading of the law," Commissioner Mike O'Rielly said in a statement. "It also signals that the court is willing to call the Commission to task for inappropriately creating authority not provided by Congress. I can only hope this view will be applied elsewhere, such as in the court's other case involving TCPA overreach.”