On December 18, 2023 the FCC released a Second Report and Order, Second Further Notice of Proposed Rulemaking (FNPRM), and Waiver Order, which it considered and adopted at its December Open Meeting, furthering what it characterized as its “multi-pronged approach to unwanted and illegal calls.” New rules were adopted concerning so-called “robotexting,” which include requirements for blocking texts from “red flagged” numbers, codifying Do-Not-Call rules for text messages, and encouraging an opt-in approach for mobile carrier delivery of email-to-text messages. The new rules also close what the Commission refers to as the “lead generator loophole” by requiring "one-to-one consent" for calls or texts subject to the TCPA prohibition on autodialed calls or texts and pre-recorded/artificial voice calls to wireless numbers absent consent or an emergency purpose. This means that sellers cannot rely on a single consumer consent provided through a lead generator or comparison shopping site for such calls or texts. Instead, under the new rule, each seller must separately obtain consent from a consumer to make calls or send texts covered by the wireless number prohibition. As part of its adoption of the new lead generator provision, the Commission also further tightened consent requirements for all telemarketing calls and texts to wireless numbers subject to the wireless number prohibition.
In the FNPRM, the Commission also seeks comment on further proposed efforts to combat illegal robocalls and robotexts. Among the proposals on which it seeks comments are additional blocking options for originating mobile carriers, text authentication and wireless traceback mechanisms, and potential limitations on wireless email-to-text services.
Here are some of the highlights from the Second Report and Order.
Mandatory Blocking of Numbers “Red Flagged” by the FCC’s Enforcement Bureau
The new “Red Flag” rule adopted by the Commission sets up a process where the FCC Enforcement Bureau can “red flag” a mobile number it has determined is being used to originate illegal texts, notify mobile carriers of such determination and its basis, and direct carriers to block the delivery of texts from that number. The notification will specify a time period for carriers to respond, confirming receipt of the notification and the initiation of blocking. The recourse for message senders who believe their numbers have been erroneously blocked is to submit a blocking error complaint to a mobile carrier’s point of contract as required under the Commission’s blocking rules. Carriers can also notify the Enforcement Bureau where a number has been reassigned, so the blocking requirement can be lifted. The new Red Flag rule will be effective 180 days after publication of the Second Report and Order in the Federal Register.
Applicability of Do-Not-Call Rules to Text Messages
Under prior Commission decisions, a wireless subscriber could add his or her number to the National Do-Not-Call (DNC) Registry, and, according to the Second Report and Order, texts to wireless numbers on the DNC Registry have been found by courts to be subject to the Commission’s DNC rules. The Commission has now codified the applicability of its DNC rules to text messages, as has historically been the case for live voice calls to wireless numbers. There is some nuance here, in that under the Commission’s rules (see 47 C.F.R. § 64.1200(e)) the DNC rules apply to wireless voice calls, and now texts, “to the extent described” in the Commission’s 2003 TCPA Second Report and Order, FCC 03-153. The Commission states in the Second Report and Order that “[t]exters must have the consumer’s prior express invitation or permission before sending a marketing text to a wireless number in the DNC Registry.” Careful readers will note that this begs the question about the treatment of texts to numbers on the DNC Registry where the texted party has an established business relationship with a sender, an interesting twist that will no doubt get significant attention in the coming months. The new DNC texting provision is expected to become effective 30 days from publication in the Federal Register.
Closing the Lead Generator “Loophole” and Prior Express Written Consent Revisions
The TCPA wireless number prohibition texts and calls and pre-recorded/artificial voice calls to wireless numbers are prohibited absent the called party’s prior express consent or an emergency purpose, with prior express written consent required for telemarketing calls and texts. The Commission implemented the new lead generator provision through a revision to its “prior express written consent” definition applicable to telemarketing calls and texts subject to the wireless number prohibition. In its amendment to the prior express written consent definition, the Commission made clear that the wireless number prohibition applies to a single seller at a time, requiring one-to-one consent between seller and consumer, thereby prohibiting lead generation and comparison shopping sites from “sharing lead generation information with a daisy chain of ‘partners’” for consent purposes.
Such one-to-one consent requires businesses making calls or texts for marketing purposes subject to the prohibition to “obtain a consumer's prior express written consent [to such communications] from a single seller.” Even if a lead generator website lists multiple sellers on its webpage, the Commission emphasized that the business must obtain prior express written consent from the consumer separately for each seller through a “clear and conspicuous” disclosure (which is already a requirement of the prior express written consent rule), rather than in buried, fine-print or in a separate page reached through a link.
Responding to criticism of the impacts and burdens of the proposed rule, the Commission notes that comparison shopping sites can “obtain the requisite consent . . . using easily-implemented methods.” Among the methods identified by the Commission for sites and sellers to comply with the new requirement would be for a lead generator or comparison shopping website to have a check-box for the consumer to specifically select the seller from which the consumer wishes to hear, or include a clickthrough link to a seller site, where the seller can obtain the consumer’s consent directly.
In an important change to the prior express written consent definition that is not just limited to lead generation and comparison shopping communications, the definition will now specifically provide that telemarketing texts and calls that result from consumer consent must be “logically and topically associated with the interaction that prompted the consent.” By way of example, the Commission noted that a consumer giving consent on a car loan comparison shopping website (i.e., the “interaction that prompted the consent”), does not provide consent to get texts or calls about loan consolidation, which apparently the Commission would not view as “logically or topically associated” with the car loan website. The Commission declined to further define “logically and topically associated,” an omission that is sure to be tested in the courts as telemarketers and TCPA plaintiffs fight over the exact contours of the “logically and topically associated” phrase.
In adopting the rules, the Commission also responded to stiff opposition from, among others, the financial and insurance sectors, lead generators, and small business interests, including the Small Business Administration’s Office of Advocacy, on the impacts of the rules on comparison shopping sites relied on by small businesses. In addition to suggesting ways, as discussed above, on complying with the new one-to-one requirement, the Commission also noted that the rule, as adopted, only limits sellers from initiating calls or texts that would otherwise be subject to the wireless prohibition. It noted that businesses are still free to reach out to consumers through calls and texts that are not subject to the wireless prohibition, or using email or regular mail, both to provide information and to solicit further one-to-one consent to calls and texts to wireless numbers that would otherwise be subject to the wireless number prohibition. Seeking to further allay concerns from these various interests that opposed the new lead generator limitations, the Commission emphasized that nothing in the new rule is intended to restrict the ability of businesses from relying on leads generated by third party lead generators or limit comparison shopping sites, beyond requiring one-to-one consent for calls and texts subject to the wireless prohibition.
In terms of effective date, the new lead generator and related provisions will not go into effect for at least the later of one year from publication in the Federal Register, or completion of any required review of the new provisions by the Office of Management and Budget.
While declining to adopt a specific rule on email-to-text, the Commission encouraged providers to make email-to-text messages an opt-in service, where wireless subscribers would have the option of declining consent to receive text messages originating from an email account. The Commission noted that making email-to-text subject to opt-in consent should further reduce the number of fraudulent text messages consumers receive given the hurdles in identifying the person or entity controlling an email account. In the FNPRM, the Commission also seeks comment on whether wireless carriers should be required to obtain opt-in consent for its subscribers to receive email-to-text messages.