Could it be true? The only constant in the TCPA universe is change!
10/22/2019 9:00
The following article was contributed by a member of ACA International’s Member Attorney Program (MAP) committee. ACA Daily will publish future legal analyses and thought pieces written by members of this important committee.
Written by:
Monica Littman
Fineman, Krekstein & Harris P.C
In Gorss Motels, Inc. v. Safemark Sys., LP, 931 F.3d 1094 (11th Cir. 2019), the Eleventh Circuit’s opinion involving the Telephone Consumer Protection Act (“TCPA”) and the solicited-fax rule seems straightforward at first. The case involved two hotel franchisees which claimed they did not give their prior express permission to receive faxes from an affiliate of their franchisor hotel group. Congress passed the TCPA in 1991 and amended it with the Junk Fax Prevention Act in 2005. Congress authorized the FCC to issue regulations to implement the TCPA. The TCPA prohibits sending unsolicited advertisements via fax, however, there is an exception when a person has given prior express consent to receive unsolicited faxes. The Eleventh Circuit’s majority opinion upheld the district court’s determination that the faxes were solicited because the franchisees had given prior express consent to receive the faxes. The franchisee hotels also argued that the district court violated the Hobbs Act when it refused to apply the FCC’s solicited-fax rule. The Hobbs Act vests the courts of appeals with the “exclusive jurisdiction to enjoin, set aside, suspend (in whole or in part), or to determine the validity” of certain agency orders, 28 U.S.C. § 2342. A party has 60 days from the issuance of an agency’s final order to seek judicial review before a circuit court of appeals. The majority opinion rejected the argument as it found that the FCC had eliminated the solicited-fax rule and abated any liability for past violations.
However, the concurring opinion called for a drastic review of how district courts in the Eleventh Circuit view the Hobbs Act. The Eleventh’s Circuit’s prior precedent stood for the proposition that district courts could not review any argument challenging an agency’s final order. Ultimately, the concurring opinion stated that the Hobbs Act does not require a district court to follow an agency’s interpretation of a statute every time there is a question regarding federal law that is subject to an agency’s order.
The prior decisions had misinterpreted the Hobbs Act to “mean that an agency’s interpretation of federal law in a final order is subject to only a single 60-day window for judicial review in a single circuit-court proceeding, outside of which no party to any proceeding in any court may question the agency's interpretation, no matter how wrong.” The concurring opinion further stated that “[t]he Hobbs Act, correctly construed, does not require district courts adjudicating cases within their ordinary jurisdiction to treat agency orders that interpret federal statutes as binding precedent. Our precedents’ interpretation of the Hobbs Act ignores the statutory context, generates absurd results, and raises serious constitutional doubts. In the earliest appropriate case, we should correct our mistake en banc.”
The concurring opinion also referenced the Supreme Court’s very recent concurring opinion with approval in PDR Network, LLC v. Carlton & Harris Chiropractic, Inc., 139 S. Ct. 2051 (2019), which noted that under the Hobbs Act the District Court was not bound by the FCC’s interpretation of the TCPA. In PDR, the concurring opinion stated that “[r]ather, the District Court should interpret the TCPA under usual principles of statutory interpretation, affording appropriate respect to the agency’s interpretation.”
The concurring opinion signifies that the only constant in the TCPA universe is change. The concurring opinion in Gorss is setting up a new strategy under a Hobbs Act defense to erode the enforceability of agency orders in district courts. The question is will other courts follow the reasoning in Gorss. We are already seeing inconsistent decisions in district courts and circuit courts of appeal across the country after the D.C. Circuit court issued its decision in March 2018 in ACA International v. Federal Communications Commission, et al. The D.C. Circuit set aside the FCC’s expansive interpretation of what constitutes an ATDS. The district courts are now left to figure out what the definition of an ATDS, how to interpret the FCC’s prior orders, and which of those orders are still in effect. This also sets up more questions to come regarding the CFPB and rulemaking as we await the Supreme Court’s decision in Seila Law v. Consumer Financial Protection Bureau, where the constitutionality of the Consumer Financial Protection Bureau’s leadership structure will be decided.