D.C. Circuit Sets Aside FCC’s Expansive Interpretation of the Telephone Consumer Protection Act

By: Wayne StreibichEdward W. ChangJonathan M. RobbinScott E. WortmanDiana M. Eng, and Hilary F. Korman

In a significant ruling for businesses, technological progress, and the economy at large, the D.C. Circuit Court of Appeals unanimously granted in part, and denied in part, various petitions for review of the Federal Communications Commission’s (“FCC”) adoption of its 2015 Declaratory Ruling and Order (the “2015 Order”) on the Telephone Consumer Protection Act (“TCPA”). The 2015 Order significantly changed the legal landscape of the TCPA, and had serious global consequences for numerous markets and businesses. In ACA Int’l v. FCC, (D.C. Cir. Mar. 16, 2018), the D.C. Circuit provided guidance on a number of issues, including the FCC’s “unreasonably expansive interpretation” of what constitutes an “Automatic Telephone Dialing System” or “ATDS” under the TCPA.


Congress enacted the TCPA in 1991 to curb abusive telemarketing practices and encroachments on business and consumer privacy. The TCPA contains a private right of action permitting aggrieved parties to recover $500 for each call made (or text message sent) in violation of the statute, and up to $1,500 for each “willful or knowing” violation. See 47 U.S.C. § 227(b)(3). However, with the evolution of technology, statutory damages that may have seemed reasonable in 1991 have since morphed into a mammoth threat against any company employing automated dialing equipment. The FCC (the agency vested with the authority to promulgate regulations implementing the TCPA’s requirements) has further compounded the issue by propounding a litany of rulemakings and declaratory rulings that have expanded the scope and reach of the TCPA. Continue reading

Third Circuit Holds “Settlement Language” in Collection Letter Can Be Misleading

By: Jonathan M. RobbinEdward W. Chang, and Scott E. Wortman

Action Item: In a change of course from its prior holding in Huertas v. Galaxy Asset Mgmt., 641 F.3d 28 (3d Cir. 2011), the Third Circuit rules that the terms “settlement” and “settlement offer,” in connection with collecting of a time barred debt, may connote litigation and thus mislead a consumer. However, the Court continues to hold that settlement terms alone do not necessarily constitute deceptive or misleading practices under the FDCPA.

In a unanimous published decision in Tatis v. Allied Interstate LLC, No. 16-4022 (3d Cir.) the Third Circuit reversed the District of New Jersey’s granting of a motion to dismiss. The lower court had held that a debt collector’s attempt to collect the time-barred debt did not violate the Fair Debt Collection Practices Act (“FDCPA”) because the collection letter was not accompanied by a threat of legal action. In its order overruling the lower court, the Third Circuit deviated from its prior holding in Huertas v. Galaxy Asset Mgmt., 641 F.3d 28 (3d Cir. 2011) and instead looked to the more recent decisions from its sister circuits—the Fifth, Sixth, and Seventh—which all held that the term “settle” could mislead a consumer. Continue reading

Eastern District of New York Court Holds Debt Collection Letter Stating Settlement May Have Tax Consequences Does Not Violate the Fair Debt Collection Practices Act

By: Jonathan M. Robbin, Diana M. Eng, and Andrea Roberts

In Ceban v. Capital Management Services, L.P., Case No. 17-cv-4554 (E.D.N.Y. Jan. 17, 2018), the District Court held that the statement “[t]his settlement may have tax consequences” in a debt collection letter does not violate the Fair Debt Collection Practices Act (“FDCPA”).

On or about August 6, 2016, Plaintiff, Julian Ceban (“Plaintiff”) received a collection letter from defendant Capital Management Services, L.P. (“Defendant”) concerning his outstanding debt (the “Letter”). The letter stated, in relevant part, that Defendant was “authorized to accept less than the full balance due as settlement” and that Plaintiff could “contact [Defendant] to discuss a potential settlement.” Further, the letter indicated: “This settlement may have tax consequences. If you are uncertain of the tax consequences, consult a tax advisor.” Continue reading

California District Court Holds that a Debt Collector’s Retention of a Portion of a Transactional Fee Voluntarily Paid by the Consumer for Purposes of Convenience Was a Violation of the Rosenthal Fair Debt Collections Practices Act

By:  Nadia D. Adams

In April Lindblom v. Santander Consumer USA Inc., No. 15-cv-0990 (E.D. Cal. January 22, 2018), the United States District Court for the Eastern District of California held that the plaintiffs’ voluntary payment of a transactional fee that was not expressly authorized in the contract between the parties or by California state law was concrete injury sufficient to confer Article III standing.

The Court also held that where the underlying contract between the parties was silent on the debt collector’s retention of a transactional fee for online and telephone payments, the parties could not subsequently orally modify that contract to allow for the fee; the fee must be contemplated at the time the debt is created. Therefore, the debt collector’s portion of the fee violated the Rosenthal Fair Debt Collection Practices Act (the “Rosenthal Act”). Continue reading

Eleventh Circuit Holds that Voicemails Are “Communications” and Clarifies “Meaningful Disclosure” Under the FDCPA

By:  Diana M. Eng and Paul Messina, Jr.

In Stacey Hart v. Credit Control, LLC, No. 16-17126 (11th Cir. Sept. 22, 2017), the United States Court of Appeals for the Eleventh Circuit clarified two significant definitions under the Fair Debt Collection Practices Act (“FDCPA”), one of which was a novel issue for the Court.  First, the Eleventh Circuit ruled that the first voicemail that Credit Control LLC (“Credit Control”) left for Stacey Hart (“Hart”) qualified as a “communication” within the meaning of 15 U.S.C. § 1692a(2).  Because the voicemail was the initial communication between the parties, Credit Control had to provide the required disclosures under 15 U.S.C. § 1692e(11), commonly known as the “mini Miranda” warning.

Second, the Eleventh Circuit determined the novel issue of what constitutes a “meaningful disclosure” under the FDCPA by ruling that an individual caller is not required to disclose his/her identity as long the caller discloses that the call is being made on behalf of a debt collection company and the debtor collection company’s name.

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Eleventh Circuit Rules that Consumers Have the Right to Partially Revoke Consent to Automated Calls under the TCPA

By: Michael Esposito

The Eleventh Circuit Court of Appeals recently issued its opinion in Emily Schweitzer v. Comenity Bank, holding that the Telephone Consumer Protection Act, 47 U.S.C. sec. 227 et seq. (“TCPA”), allows consumers to partially revoke their consent to be called by an automated telephone dialing system. No. 16-10498 (Eleventh Cir. August 10, 2017).

In Schweitzer, Plaintiff was issued a credit card by Comenity Bank (“Comenity” or the “Bank”) in 2012 and, during the application process, provided a cellular phone number to the Bank. In 2013, Plaintiff failed to tender the required monthly credit card payments and, as a result, Comenity used an automated telephone dialing system to make hundreds of calls to Plaintiff on her cellular phone regarding the delinquency. During a call with a Comenity representative on October 13, 2014, Plaintiff informed the representative that Comenity could not call her in the morning and during the work day, because she was working and could not discuss the delinquency while at work. Subsequently, Plaintiff twice told a representative of Comenity to please stop calling her. Thereafter, Comenity did not call Plaintiff’s cellular phone using an automated telephone dialing system.

Ultimately, Plaintiff commenced a suit against Comenity for alleged violations of the TCPA. Specifically, Plaintiff claimed that during the October 13th conversation, she revoked her consent for Comenity to call her cellular phone using an automated telephone dialing system and asserted that Comenity violated the TCPA by placing over 200 calls using an automated system from October 2014 through March 2015. The district court granted summary judgment in favor of Comenity and reasoned that the bank “did not know and should not have had reason to know that [Plaintiff] wanted no further calls.” In addition, the district court stated that Plaintiff did not “define or specify the parameters of the times she did not want to be called” and, therefore, a reasonable jury could not find that Plaintiff revoked her consent to call her cellular phone. Plaintiff appealed.

On appeal, Comenity argued that the district court correctly granted summary judgment in its favor because the TCPA does not allow partial revocations of consent and, even if possible, a reasonable jury could not find that Plaintiff had expressly done so during the October 13th conversation. The Eleventh Circuit Court rejected Comenity’s arguments, finding that “[a]lthough the TCPA is silent on the issues of revocation, [its] decision in Osorio holds that a consumer may orally revoke her consent to receive automated phone calls.” See Osorio v. State Farm Bank, F.S.B., 746 F. 3d 1242, 1255 (11th Cir. 2014).

Further, the Eleventh Circuit explained that since the TCPA is silent as to partial revocations of consent, the analysis of the matter is governed by common law principles, which support its holding that the TCPA “allows a consumer to provide limited, i.e., restricted, consent for the receipt of automated calls.” Moreover, “[i]t follows that unlimited consent, once given, can also be partially revoked as to future automated calls under the TCPA.” In support of its conclusion, the Eleventh Circuit reasoned that it is “logical that a consumer’s power under the TCPA to completely withdraw consent and thereby stop all future automated calls . . . encompasses the power to partially withdraw consent and stop calls during certain times.” Although the Eleventh Circuit noted the district court’s concern that partial revocations may create challenges for both callers and parties attempting to present evidence in support of TCPA claims, it held that any such complications do not warrant limiting a consumer’s rights under the TCPA.

Second, with regard to Comenity’s argument that a reasonable jury could not find that Plaintiff’s statements made during the October 13th conversation constituted a partial revocation of consent under the TCPA, the Eleventh Circuit ruled that the “issue is close” and concluded that the matter of partial revocation was for the jury to evaluate. In reaching its conclusion, the Eleventh Circuit found that summary judgment was not warranted since reasonable minds might differ on the inferences arising from Plaintiff’s request not to be called “in the morning and during the work day.”

This decision is significant because the Eleventh Circuit has expanded the consumer’s right to revoke consent under the TCPA to include partial revocations. Based on this decision, debt collectors conducting business within the Eleventh Circuit will need to update their automated dialing systems to incorporate such partial revocations.

Ninth Circuit Holds that Consumer Alleging FCRA Claim Against Spokeo Sufficiently Pled a Concrete Harm to Article III Standing

By: Wayne Streibich,Francis X. CrowleyCheryl S. Chang, Diana M. Eng and Nadia D. Adams

In Thomas Robins v. Spokeo, Inc., No. 11-56843 (9th Cir. Aug. 15, 2017) (“Spokeo III”), the United States Court of Appeals for the Ninth Circuit unanimously ruled that Thomas Robins (“Robins”), who accused Spokeo, Inc. (“Spokeo”) of violating the Fair Credit Reporting Act (the “FCRA”) by allegedly reporting inaccurate information about him on its website, claimed a sufficiently concrete injury to confer standing under Article III of the U.S. Constitution.


Spokeo operates a website that compiles consumer data and builds individual consumer profiles containing details about a person’s life, including age, contact information, level of education, marital status, employment status and wealth. Spokeo also markets its services to businesses as a way to learn about prospective employees. Robins sued Spokeo for willful violations of the FCRA, which, among other things, requires credit reporting agencies to take steps to ensure the information they provide to potential employers is accurate. 15 U.S.C. § 1681 et seq. Robins alleged Spokeo published an inaccurate report about him on its website, including that he was wealthy and had a graduate degree when in fact, he was struggling to find work.

Initially, the district court dismissed Robins’s suit based on its determination that Robins lacked standing to sue under Article III of the U.S. Constitution because Robins had not adequately pled that the alleged violation caused him an injury-in-fact. Id. at p.6. Robins appealed and the Ninth Circuit reversed on the basis that Robins established a sufficient injury-in-fact because he alleged that Spokeo violated specifically his statutory rights, which Congress established to protect against individual rather than collective harms. Robins v. Spokeo, Inc. (Spokeo I), 742 F.3d 409, 413-14 (9th Cir. 2014) (emphasis added).

The United States Supreme Court Decision

On Certiorari review, the United States Supreme Court vacated the Spokeo I opinion, because although it agreed with the Ninth Circuit’s analysis and determination that Robins established an alleged injury sufficiently particularized to him, the Ninth Circuit’s standing analysis was incomplete. Spokeo, Inc. v. Robins (Spokeo II), 136 S. Ct. 1540 (2016). The Supreme Court held that a bare procedural statutory violation is insufficient to establish a concrete injury-in-fact to confer standing. Id. at 1548-49 (internal citations omitted). In Spokeo II, the Supreme Court reasoned that the reporting of an incorrect zip code, absent another misrepresentation, was unlikely to present any material risk of real harm. Id. at 1550. Thus, the Supreme Court remanded the case to the Ninth Circuit with instructions for it to consider whether, in addition to a particularized injury, Robins also sufficiently pled a concrete injury. Spokeo III at p.7.

The Ninth Circuit’s Decision on Remand

On remand, the Ninth Circuit held that Robins had alleged injuries that were sufficiently concrete for purposes of Article III, and because the alleged injuries were previously determined to be sufficiently particularized, Robins adequately alleged all of the elements necessary to establish Article III standing. Id. at p.2. In reaching its conclusion, the Ninth Circuit conducted a two-fold analysis.

First, it considered whether Congress established the FCRA to protect consumers’ concrete interest in accurate credit reporting about themselves, and held that it did. The Ninth Circuit further noted the “ubiquity and importance of consumer reports in modern life” and held that the “real-world implications of material inaccuracies in those reports seem patent on their face.” Id. at p.12.

Second, the Ninth Circuit considered whether the FCRA violations that Robins alleged actually harmed or created a “material risk of harm” to his concrete interest in accurate crediting reporting about himself. Id. at p.15. (Internal citations omitted). The Court noted that Robins’s allegations were not minor and could be deemed a real harm because Robins specifically alleged that Spokeo falsely reported—and published—several inaccurate facts including his marital status, age, employment status, educational background and level of wealth. Id. at p.16. Further, even though some of the inaccuracies could be considered flattering and the likelihood to harm could be debated, the inaccuracies alleged did not strike the Court as mere “technical violations” outside the scope of what Congress sought to protect with the FCRA. Id. (Internal citations omitted).

Importantly, however, the Ninth Circuit reiterated that Spokeo II “requires some examination of the nature of the specific alleged reporting inaccuracies to ensure that they raise a real risk of harm to the concrete interests that [the] FCRA protects.” Id. at p.17. The Ninth Circuit cautioned that not every minor inaccuracy would cause real harm. Id. at p.16. Thus, not every FCRA violation premised on some inaccurate disclosure of Robins’s information is sufficient. Id. at pp.16-17.


The Ninth Circuit’s decision is significant for several reasons. First, while declining to express an opinion on the circumstances in which alleged inaccuracies of the kind pled by Robins would or would not cause concrete harm, the Court held that the allegations of Robins’s FCRA class action complaint, which are premised on a “material risk of harm” to his employment opportunities, should proceed past the initial pleading stage. Second, because the Ninth Circuit did not set a bright-line rule for what information necessarily establishes a “concrete injury” and declined to comment on whether Robins would have alleged a concrete injury had Spokeo merely produced, but not published the information, businesses will operate (and litigate) in a gray area until a case law framework for “concrete injury” is established.

Mr. Streibich would like to thank Cheryl Chang, Diana Eng, and Nadia Adams for their assistance in developing this Alert.