4th Circuit Critical of Uncle Sam’s Robocall Loophole

RICHMOND, Va. (CN) - Defending a loophole to robocall laws carved out for the collection of federally backed loans, a lawyer for the government faced strident grilling Wednesday at Fourth Circuit oral arguments.

U.S. Circuit Judge Barbara Keenan was among the toughest interrogators on the panel in Richmond, Virginia, this morning as Justice Department attorney Lindsey Powell described the 2015 loophole as highly limited.

“Do you know how many calls these debt collectors make,” asked Keenan, a Reagan appointee. “Student debt, mortgage loans. … I couldn’t imagine the number of total calls the exemption allows these companies to make. Is it really narrowly tailored?” 

Though Powell did not have those specific numbers, she insisted that the law, as approved by Congress, helped curb the much larger problem of robocalls. 

But Powell faced pushback from U.S. Circuit Judge Robert King regarding how the exemption came to pass.

“Who wanted this exemption, banking companies?” the Clinton appointee asked.

As Powell stressed that Congress adopted the exemption to address growing debt, King latched on to the specifics of the bill — how it made debt collectors the sole entity that could use robocalling in this way.

“The problem would be cured if the government did it themselves [without robocalls or autodialers],” King said. “You could fix it right now.”

Powell is pushing the Fourth Circuit to affirm after a federal judge in North Carolina agreed last year that the exemption, seen as an option to reign in national debt, was limited enough to avoid constitutional scrutiny. 

Opposing that view are several political action committees and pollsters, led by the American Association of Political Consultants. “[The exemption] creates a content-based loophole for commercial calls,” said William Raney, an attorney for this group with the law firm Copilevitz and Canter. 

For Raney, the moment the exemption gave room to debt collectors, even if backed by the federal government, it discriminated against other speech based on subject-matter, thus running afoul of the First Amendment. 

Pointing to precedent, Raney recalled how the U.S. Supreme Court overturned a state law that banned picketing unless it involved labor disputes. Raney said that law similarly outlawed a form of speech except for a version based on content. 

“The remedy to be applied is more speech, not enforced silence,” he said, quoting the famous line from a 1927 opinion by Supreme Court Justice Louis Brandeis. 

The Ninth Circuit has taken up a similar challenge but has not yet set a date for oral arguments.

On Wednesday meanwhile the Fourth Circuit did not indicate when it will rule on the case.

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