FCC Cites First National Bank Because Consumers Had to Agree to Receive Marketing Texts in Order to Use the Services Offered

The FCC announced on September 11, 2015 that it had cited First National Bank for violation of the Telephone Consumer Protection Act (TCPA) because in connection with First National Bank's  online banking service and Apple Pay mobile banking service, consumers were required to agree to receive marketing text messages sent using an automatic telephone dialing system.  Here's a link to the FCC's citation: https://apps.fcc.gov/edocs_public/attachmatch/DA-15-996A1.docx

I see a few big problems here. (Of course these are my own personal opinions and do not necessarily reflect the views of my firm, my firm's clients, or anyone else for that matter.)

The first problem with the citation is that the TCPA itself does not prohibit companies from requiring consumers to consent to receive text messages (marketing or otherwise) as a condition of using a service.  Rather, the provision of the TCPA that the FCC and the courts have applied to text messages prohibits calls made using an automatic telephone dialing system (often referred to as an "autodialer") to any wireless number without the prior express consent of the called party, or in other limited circumstances.  There is nothing in the statute at all, nor as far as I'm aware in the legislative history, to suggest that Congress intended to prohibit companies from requiring consumers to agree to receive autodialer calls in connection with the provision of certain services, particularly those accessible via mobile technologies.  Congress required consent for autodialer calls to wireless numbers, but that's it.

So where is the FCC coming from? Well, as of October 16, 2013, new FCC  regulations went into effect that that distinguish between the "prior express consent" required for autodialer calls/texts that are purely informational, and the "prior express consent" required for autodialer calls/text  that introduce an ad or amount to telemarketing. For purely informational calls/texts, "prior express consent" is satisfied where a consumer has provided a cellphone number to a business and the business calls or texts the consumer in a context where the consumer would expect the calls/texts.  This satisfied "prior express consent" for all purposes prior to October 16, 2013.  But after that date, the new regulations require prior express written consent for autodialer calls/texts to wireless numbers that introduce an ad or amount to telemarketing.  That in and of itself might be okay.  Telemarketing calls/texts to wireless numbers are more of an annoyance and intrusion than informational calls, so a written consent requirement ensures they are only made with consent as required by Congress.  But the FCC went further, and in this writer's view, exceeded its authority.  In the regulation requiring prior express written consent for these types of calls, the FCC defined "prior express written consent" in a way that requires significantly more than written consent.  Not only must the consent be in writing, but it must amount to an agreement, signed by the consumer in a manner that satisfies eSign or a state equivalent, and it must include (at least in substance) clear and conspicuous disclosures that the consumer is agreeing to receive telemarketing calls, made using an autodialer (or artificial or prerecorded voice where those calls are to be made), and -- here's the kicker -- that "the person is not required to sign the agreement (directly or indirectly), or agree to enter into such an agreement as a condition of purchasing any property, goods, or services." 47 CFR 64.1200(f)(8)(i)(B).  As far as I can tell, the FCC just made this last part out of whole cloth.  

The FCC has even further exceeded its authority in seeking to enforce not just its unauthorized disclosure requirement, but what companies are supposed to divine from that requirement: that you can't condition the purchase of any property, goods, or service -- or the use of any free service apparently -- on an agreement to receive autodialer marketing text messages.  Nothing in the statute or the regulations makes that clear.  And it's hard to understand in many contexts why such a requirement makes sense.  For example, if I offer an app that provides consumers who choose to dowwnload it the opportunity to receive special discount codes from merchants for in store purchases sent via SMS based on the consumer's location, how can I even offer my app without conditioning use of the service on an agreement to receive text messages that amount to marketing and under the FCC's view are sent using an autodialer?  As Commissioner O'Rielly stated in response to the citations, the FCC's "action showcases once again the Commission’s complete cluelessness when it comes to the tech economy, missing the point about how these free, popular, and entirely optional services actually work." https://apps.fcc.gov/edocs_public/attachmatch/DOC-335232A1.docx

The second problem with the FCC citation is that it's not clear that First National Bank ever sent any autodialer telemarketing text messages, or ever intended to.  So many U.S. businesses have been sued in TCPA class actions, that when it comes to compliance, they are erring on the side of getting express written consent to make autodialer telemarketing calls/texts even if the calls they are making/texts they are sending are informational.  From these companies' perspectives, they don't want an issue as to whether they have the appropriate consent, so they are getting people to provide consent for autodialer telemarketing calls when they sign up to use a service, just to protect against litigation, even if they only intend to communicate with their users to provide information.  This is a problem of the FCC's making.  It is only making it worse by causing legal and reputational problems for companies that are trying to comply.

Finally, the FCC could be spending its taxpayer dollar enforcement budget going after the real bad actors who are blatantly violating the TCPA.  In support of the July 10, 2015 omnibus TCPA ruling (see my prior posts for a breakdown), the three commissioners who voted in favor justified their votes based on the continuous bombardment we all receive of telemarketing calls to our residential lines, despite the fact that we registered for the Do-Not-Call database.  Nobody likes or wants those calls.  And the FCC should be doing something to prevent them.  Instead, it is wasting valuable resources enforcing made up rules, that are not clearly in effect, and that serve no purpose other than to stifle innovation in the mobile technology arena.  How many consumers have complained that they were required to agree to receive text messages that might be sent using an autodialer and might include telemarketing as a condition of using a mobile technology service, compared to the number of consumers who complain on a daily basis about unsolicited telemarketing calls being placed despite registration on the DNC registry?  Come on FCC, get your priorities straight!