Updates to our Terms of Use

We are updating our Terms of Use. Please carefully review the updated Terms before proceeding to our website.

Monday, February 26, 2024 | Back issues
Courthouse News Service Courthouse News Service

Robocall Loophole Defeated at Fourth Circuit

The fight against robocalls got a boost Wednesday when the Fourth Circuit struck down a loophole carved out for the collection of federally backed loans.

RICHMOND, Va. (CN) – The fight against robocalls got a boost Wednesday when the Fourth Circuit struck down a loophole carved out for the collection of federally backed loans.

In a 25-page opinion, the Richmond, Virginia-based appeals court invalidated an exemption allowing certain debt-collection robocalls in a federal law designed to otherwise protect people’s privacy on cellphones.

At issue was an amended section of the 1991 Telephone Consumer Protection Act, which first created a federal ban on calls to cellphones by a robocall system using automated voices. While other exemptions existed, like for federal emergency systems, language was added in 2015 that allowed such calls if they were in service of collecting debts owed to or guaranteed by the federal government.

Several political action committees and pollsters, including the American Association of Political Consultants, filed suit against the Federal Communications Commission over the debt-collection exemption in North Carolina federal court in 2016.  

They argued the rule amounted to content discrimination in violation of the First Amendment with the government permitting some types of speech using the robocall platform but denying others.

A federal judge was not swayed and said the rule was narrowly tailored enough to avoid constitutional scrutiny. 

However, the Fourth Circuit reversed Wednesday.

“By authorizing many of the intrusive calls that the automated call ban was enacted to prohibit, the debt-collection exemption subverts the privacy protections underlying the ban,” U.S. Circuit Judge Robert King wrote, saying the rule failed the strict scrutiny test. “The impact of the exemption deviates from the purpose of the automated call ban and, as such, it is an outlier among the other statutory exemptions.”

But King, a Bill Clinton appointee, declined to strike down the entire robocall ban.

“The ban can operate effectively in the absence of the debt-collection exemption,” he wrote. “If Congress wants the balance of a statute to stand when one aspect is constitutionally flawed, a reviewing court ‘must leave the rest of the [statute] intact.’”

U.S. Circuit Judges Barbara Keenan and Marvin Quattlebaum joined King in his opinion.

William Raney, an attorney with Copilevitz, Lam and Raney who argued on behalf of American Association of Political Consultants last December, said he was not pleased with the decision.

“Normally, when it comes to the First Amendment, the remedy is more speech,” he said in a phone call with Courthouse News. “Instead, they said the statute itself is fine, it’s just this one exemption which makes it content-based; we’re just going to strike the exemption.”

“Less speech is now the result,” he said, before stating his clients were reviewing their options as far as an appeal to the U.S. Supreme Court.

“The appropriate remedy is more speech, not less speech,” Raney reiterated.  

Raney said his clients would use robocall systems for what would normally be “fully protected” political speech.

“We want people to be able to speak, that’s what the First Amendment is all about,” he said.

Wednesday’s ruling doesn’t necessarily mean Americans will see a drop in the number of robocalls they receive.

A 2018 report by Robocall Radar found U.S. cellphones received as many as 26.3 billion robocalls last year. Even with laws like the TCPA in place, the FCC has struggled to issue fines fast enough.

“Combating illegal robocalls is our top consumer priority at the FCC,” FCC Chairman Ajit Pai said in a statement late last year. He’s been advocating for a “call authentication” system to help curb the problem.

“It’s the best way to ensure that consumers can answer their phones with confidence,” Pai said. “If it does not appear that this system is on track to get up and running next year, then we will take action to make sure that it does.”

The FCC did not immediately respond Wednesday to a request for comment on the Fourth Circuit ruling.

Follow @@BradKutner
Categories / Appeals, Business, Civil Rights

Subscribe to Closing Arguments

Sign up for new weekly newsletter Closing Arguments to get the latest about ongoing trials, major litigation and hot cases and rulings in courthouses around the U.S. and the world.