Application of the Telephone Consumer Protection Act to Intrastate Telemarketing Calls and Faxes.
|Miller, Hilary B.
They wake us up in the morning; they interrupt our dinner at night; they force the sick and elderly out of bed; they hound us until we want to rip the telephone right out of the wall. .... It is telephone terrorism, and it has got to stop.(1) In 1991, with the passage of the Telephone Consumer Protection Act of 1991 (TCPA),(2) Congress took the first significant step in curbing what many perceived as an onslaught of telemarketing that had invaded Americans homes. However, what began as a straightforward remedy to telephone terrorism resulted in a less than perfect example of legislative clarity.
The TCPA presents "an unusual constellation of statutory features."(3) It provides a federal right to be free from certain types of telephone solicitations and facsimiles (faxes), but it does not permit a victim to enforce that right in federal court.(4) The TCPA's principal enforcement mechanism is a private suit, but the TCPA does not permit an award of attorney fees to the prevailing party, as do most other private attorney general statutes.(5) The TCPA is practically incapable of forming the basis of a class action,(6) even though, in theory, it provides relief for large numbers of victims of identical violations resulting from identical acts by identical actors. In a final and ironic twist of legislative compromise, although the TCPA proscribes a wide range of offensive conduct, Congress intended for private enforcement actions to be brought by pro se plaintiffs in small claims court and practically limited enforcement to such tribunals.(7)
Lack of access to federal courts and to the class action form of litigation, the nominal harm and imperfect prosecution (almost exclusively by pro se plaintiffs) essentially insures that few TCPA cases will result in reasoned appellate decisions. Moreover, state small claims courts (over which Holmses, Hands, and Cardozos rarely preside) are poor forums for producing uniform interpretations of federal law. The problem has been exacerbated by a dearth of cogent law review scholarship and analysis to aid construction, producing a body of divergent and conflicting decisions. This Article seeks to promote uniform construction and application of the TCPA.(8)
Because the TCPA does not preempt and Congress expressly intended it to coexist with state telemarketing law, there has been confusion regarding the application of the TCPA to intrastate telemarketing calls and fax advertisements. The analysis has two branches. First, did Congress intend the TCPA to cover intrastate calls? Second, if Congress intended the TCPA to cover intrastate calls, does Congress have the constitutional authority to regulate calls and faxes that are purely intrastate in nature? The answer to both of these questions is an unqualified "yes."
Chair King, Inc. v. Houston Cellular Corp.,(9) a later vacated unpublished federal district court decision, was the first case to address the question of whether the TCPA applies to intrastate telemarketing activity. That court concluded that "the TCPA only attempts to regulate interstate telemarketing activity,"(10) and "the recipient of an intrastate fax advertisement has no private right of action under the TCPA."(11)
Another federal court considered this question in another unreported case, also later vacated on other grounds, in Nicholson v. Hooters of Augusta, Inc.(12) The Nicholson court, citing the soon-to-be-vacated(13) Chair King decision, also held that "[t]he TCPA regulates only interstate transmissions."(14)
The courts of appeals later vacated both Chair King and Nicholson for lack of subject matter jurisdiction.(15) Both cases are now proceeding in their respective state courts. Even though vacated, the reasoning and conclusions of these district court decisions refuse to die; they reappear in telemarketers' arguments in other TCPA cases,(16) and telemarketers are likely to continue to raise these arguments in the future.
Several subsequent decisions from state courts have also addressed the application of the TCPA to intrastate calls and faxes.(17) In Stone v. Grossman,(18) a Florida court initially granted summary judgment to the telemarketer on the ground that the TCPA did not apply to intrastate calls. After the Federal Communications Commission (FCC) submitted an interpretive letter to the court, the court reheard the issue sua sponte and vacated the judgment, reinstating the plaintiff's claims under the TCPA.(19) In Internet America, Inc. v. American Blast Fax, Inc.,(20) a Texas court concluded that the TCPA "does not apply to exclusively intrastate communications."(21) On rehearing, however, the trial court ordered further discovery to determine if any of the alleged faxes may have been interstate.(22) Most recently, the Georgia state court hearing Nicholson on remand denied the defendant's motion to dismiss, holding that the TCPA applies to intrastate faxes.(23) These cases are all still pending as of this writing.
The federal district courts in Chair King and Nicholson both erroneously held the TCPA applicable only to interstate calls. Both courts failed to consider the TCPA's conforming amendment, which explicitly provides for application to intrastate calls and faxes.(24) Neither court considered explicit statements of intent in the legislative history,(25) nor did they defer to, or even consider the FCC's interpretation of the statute, which explicitly provides for intrastate application.(26) The Chair King court held, in a largely unreasoned two-page decision, that the TCPA did not apply to intrastate calls simply because it "does not state otherwise."(27) This simplistic analysis is flawed for two reasons. First, the conforming amendment included in the statute demonstrates the clear intention of Congress that the TCPA reach intrastate calls.(28) Second, the Communications Act of 1934, as amended (Act)(29) has been found to apply generally to intrastate communications even where Congress does not explicitly mention intrastate communications.(30) Only a breathtaking lack of concern for consistency could require an explicit reference to intrastate calls with respect to the TCPA. The district court in Nicholson provided a somewhat more detailed but equally flawed reasoning for its decision. The Nicholson court cited Van Bergen v. Minnesota(31) in support of the conclusion that the TCPA had been intended to address only interstate violations.(32)
The Nicholson court, however, took this statement out of context. In Van Bergen, the court was considering possible preemption of a Minnesota "junk fax" statute by the TCPA and stated:
The congressional findings appended to the TCPA state that "[o]ver half the [s]tates now have statutes restricting various uses of the telephone for marketing, but telemarketers can evade their prohibitions through interstate operation; therefore, [f]ederal law is needed to control residential telemarketing practices." This finding suggests that the TCPA was intended not to supplant state law, but to provide interstitial law preventing evasion of state law by calling across state lines.(33) Obviously the TCPA does provide interstitial law; it serves, among other things, as a gap filler by addressing misconduct which crosses state lines that state legislatures may be powerless to proscribe. But, like numerous other federal laws and the Act itself, the TCPA is not limited in its scope to gap filling. For example, while section 223 of the Act provides restrictions on interstate commercial delivery of indecent materials to persons under eighteen years of age,(34) it also applies to intrastate delivery.(35) Similarly, section 225 provides both interstate and intrastate law on telecommunications services for handicapped persons.(36) The federal statute proscribing unauthorized interception of communications, 47 U.S.C. [sections] 605, applies both to interstate and intrastate communications.(37) A finding that the TCPA proscribes interstate misconduct is in no way dispositive of whether it also proscribes the same conduct occurring entirely within the borders of a single state.
An analysis of the intrastate application of the TCPA requires a review of the statute itself, its legislative history, its construction, and its interpretations by the FCC.
The Conforming Amendment
The statute's conforming amendment presents the clearest evidence that Congress intended the TCPA to reach intrastate calls and faxes. By way of background, an established body of law (including FCC interpretations) limits the application of the Act to interstate and foreign communications.(38) The Eighth Circuit described this restriction as "a Louisiana built fence that is hog tight, horse high, and bull strong, preventing the FCC from intruding on the states' intrastate turf."(39)
This body of law, however, is inapplicable to the TCPA since Congress explicitly exempted the TCPA, along with several other sections of the Act, from being contained within the Louisiana-built fence.(40) When Congress amended the Act with the TCPA, Congress also included a section styled as a conforming amendment.(41) It is this conforming amendment that permits the TCPA to apply to intrastate calls and faxes. It reads in its entirety as follows: Section 2(b) of the [Act] (47 U.S.C. 152(b)) is amended by striking "Except as provided" and all that follows through "and subject to the provisions" and inserting "Except as provided in sections 223 through 227, inclusive, and subject to the provisions."(42)
Congress designed the conforming amendment to add the new telemarketing law (section 227) to the list of sections (47 U.S.C. [sections] 152(b)) expanding the application of the statute not only to interstate telemarketing but also to intrastate activities. After the amendment, the section reads:
(b) Except as provided in sections 223 through 227 of this title, inclusive, and section 332 of this title, and subject to the...
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