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Fourth Circuit Strikes Down Federal Debt Collection Exemption to the TCPA

According to the Fourth Circuit, the Telephone Consumer Protection Act (TCPA) no longer exempts debt collection calls relating to debts owed to the federal government. See American Association of Political Consultants, Inc., et al. v. FCC, 18-1588 (4th Cir.). The Fourth Circuit’s decision reversed and remanded the case back to the lower court. The exemption at issue was created in 2015 by a legislative amendment to the TCPA, and it exempts automated calls that relate to the collection of debts “owed to or guaranteed by the federal government” from the TCPA’s ban on automated calls to cells phones. The impact of this decision will have immediate ramifications on debt collection practices in Maryland, Virginia, West Virginia, North Carolina, and South Carolina. Going forward, if the decision is appealed to and heard by the United States Supreme Court, there may be nationwide implications. The decision may also inform the Federal Communications Commission as it prepares its highly-anticipated overhaul of the TCPA in response to recent federal court decisions such as ACA International v. FCC that are chipping away at parts of the FCC’s July 2015 Omnibus Declaratory Ruling and Order on the TCPA.

The American Association of Political Consultants and three other groups that regularly engage in political activities challenged the exemption. The groups argued that the debt-collection exemption contravenes their free speech rights by permitting commercial debt collection calls while prohibiting the political polling calls they make – calls that are protected under the First Amendment. The Fourth Circuit agreed, finding the TCPA exemption to be fatally underinclusive, meaning the exemption covered too little speech and did not apply equally to different speakers. The Court provided two reasons: “First, by authorizing many of the intrusive calls that the automated call ban was enacted to prohibit, the debt-collection exemption subverts the privacy protections underlying the ban. Second, the impact of the exemption deviates from the purpose of the automated call ban and, as such, it is an outlier among the other statutory exemptions.”

The Court also found that the TCPA’s exemption was a content-based restriction on free speech that did not satisfy strict scrutiny review and therefore violated the Free Speech Clause of the First Amendment. Under the exemption, third parties were able to make otherwise prohibited calls to millions of debtors, and therefore the carve-out was not narrowly tailored when assessed in context.

Plaintiffs had made a broader argument that the free speech infirmity of the debt-collection exemption is not severable from the TCPA automated call ban, which would have meant that the entire robocall prohibition was unconstitutional. The Fourth Circuit denied this request and only severed the narrow exemption while leaving the remainder of the TCPA intact. This remedy is consistent with the explicit directives of the “Supreme Court and Congress [that] strongly support a severance of the debt-collection exemption from the automated call ban,” the three-judge panel found.

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Joshua Briones, Mintz, Bet Company Class Action Defense Lawyer,

Joshua, Managing Member of the firm’s LA office, is a highly experienced trial lawyer with a national practice. He has received awards and national recognition for his innovative approach to the defense of bet-the-company class actions. He has served as lead defense counsel on over 200 alleged class actions in state and federal courts across the country. 

Since the early 2000s, Joshua has advised and defended clients on TCPA faxing, prerecorded voicemail messages, mobile calls, and text messages. He also defends companies sued for allegedly...

Russell H. Fox, Communications Attorney, Mintz Levin, Regulatory Approvals

With over 30 years in the wireless telecommunications industry, Russell is among the most experienced wireless communications attorneys in the country and is a frequent speaker at industry conferences.

Before joining the firm, Russell was a partner and head of the telecommunications department in the Washington office of a major Chicago-based law firm, where he represented users and providers of telecommunications services and equipment. Previously, he was the executive director and president of the American SMR Network Association, Inc., where he established offices of a national trade association representing a segment of the wireless telecommunications industry.

Russell has extensive experience evaluating wireless telecommunications opportunities, structuring transactions involving the purchase, financing, or sale of wireless telecommunications systems, handling regulatory and legislative matters before federal and state authorities, and dealing with licensing matters before the Federal Communications Commission.

He has assisted clients that have successfully participated in spectrum auctions conducted by the Federal Communications Commission and has secured regulatory approvals necessary for clients to offer new telecommunications services and products.

Matthew Novian Complex Commercial Litigation Attorney

Matt focuses his practice on complex commercial litigation, including consumer protection matters. He has experience in drafting briefs and letters to opposing parties and in conducting depositions. In addition, Matt maintains an active pro bono practice, in which he counsels clients in matters related to immigration and domestic violence. He was a Law Clerk at Mintz in 2017. 

While attending law school, Matt was a summer associate at a Los Angeles-based law firm, where he worked on matters involving closely held corporations, commercial real estate disputes, and trademark licensing...

Elana Safner, Mintz Levin Law Firm, Washington DC, Litigation Law Attorney

Elana advises clients on public policy, regulatory issues, and disputes affecting the communications sector, as well as privacy and cybersecurity matters. She also has experience with Federal Communications Commission (FCC) procedures and rulemakings.

She has a Certified Information Privacy Professional (CIPP) (US Specialization) certification from the International Association of Privacy Professionals.

Prior to joining Mintz Levin, Elana worked as an associate in the DC office of an international law firm, where she advocated on behalf of her clients...