ACA Int'l v. Fed. Commc'ns Comm'n

United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued October 19, 2016 Decided March 16, 2018

No. 15-1211

ACA INTERNATIONAL, ET AL.,

PETITIONERS

v.

FEDERAL COMMUNICATIONS COMMISSION AND UNITED

STATES OF AMERICA,

RESPONDENTS

CAVALRY PORTFOLIO SERVICES, LLC, ET AL.,

INTERVENORS

Consolidated with 15-1218, 15-1244, 15-1290, 15-1304,

15-1306, 15-1311, 15-1313, 15-1314, 15-1440, 15-1441

On Petitions for Review of an Order of

the Federal Communications Commission

Shay Dvoretzky argued the cause for petitioners ACA

International, et al. With him on the joint briefs were Helgi

C. Walker, Monica S. Desai, Amy L. Brown, Jonathan Jacob

Nadler, Christopher J. Wright, Jennifer P. Bagg, Elizabeth

Austin Bonner, Robert A. Long, Yaron Dori, Brian Melendez,

Tonia Ouellette Klausner, Keith E. Eggleton, Kate Comerford

2

Todd, Steven P. Lehotsky, and Warren Postman. Lindsay S.

See entered an appearance.

Charles R. Messer, pro se, was on the brief for amicus

curiae Charles R. Messer in support of ACA International=s

petition.

Paul Werner argued the cause for petitioner Rite Aid

Hdqtrs. Corp. With him on the briefs was Brian Weimer.

Thomas C. Mugavero, Steven A. Augustino, Jonathan E.

Paikin, Jonathan G. Cedarbaum, Blaine C. Kimrey, and

Bryan K. Clark were on the joint briefs for intervenors MRS

BPO LLC, et al. in support of petitioners.

Don L. Bell, II was on the brief for amicus curiae The

National Association of Chain Drug Stores, Inc. in support of

petitioner Rite Aid Hdqtrs. Corp.

H. Russell Frisby, Jr., Harvey L. Reiter, Aryeh Fishman,

Michael Murray, and Jay Morrison were on the brief for

amici curiae American Gas Association, et al. in support of

petitioners.

Charles H. Kennedy was on the brief for amici curiae

The American Bankers Association, Credit Union National

Association and The Independent Community Bankers of

America in support of petitioners.

Andrew B. Clubok, Susan E. Engel, and Devin S.

Anderson were on the brief for amicus curiae The Internet

Association in support of petitioners.

Joseph R. Palmore and Seth W. Lloyd were on the brief

for amici curiae Retail Litigation Center, Inc., National Retail

3

Federation, and National Restaurant Association in support of

petitioners.

Bryan N. Tramont and Russell P. Hanser were on the

brief for amicus curiae CTIA-The Wireless Association in

support of petitioners.

Eric J. Troutman was on the brief for amici curiae

American Financial Services Association, Consumer

Mortgage Coalition, and Mortgage Bankers Association in

support of petitioners. Jan T. Chilton and Kerry W. Frarnich

entered appearances.

Amy M. Gallegos was on the brief for amicus curiae

Communication Innovators in support of petitioners.

Scott M. Noveck, Counsel, Federal Communications

Commission, argued the cause for respondents. With him on

the brief were William J. Baer, Assistant Attorney General,

U.S. Department of Justice, Kristen C. Limarzi, Steven J.

Mintz, Attorneys, Jonathan B. Sallet, General Counsel,

Federal Communications Commission, David M. Gossett,

Deputy General Counsel, and Jacob M. Lewis, Associate

General Counsel.

Craig L. Briskin and Julie Nepveu were on the brief for

amici curiae National Consumer Law Center, et al. in support

of the Federal Communications Commission 2015 Omnibus

Declaratory Ruling and Order.

Marc Rotenberg and Alan Butler were on the brief for

amici curiae Electronic Privacy Information Center (EPIC)

and Six Consumer Privacy Organizations in support of

respondents.

4

Before: SRINIVASAN and PILLARD, Circuit Judges, and

EDWARDS, Senior Circuit Judge.

Opinion for the Court filed by Circuit Judge SRINIVASAN.

SRINIVASAN, Circuit Judge: Unwanted robocalls are an

all-too-familiar phenomenon. For years, consumers have

complained to the Federal Communications Commission

about automated telemarketing calls and text messages that

they did not seek and cannot seem to stop.

Congress sought to address consumers’ concerns with

undesired robocalls in the Telephone Consumer Protection

Act of 1991. The TCPA generally prohibits the use of certain

kinds of automated dialing equipment to call wireless

telephone numbers absent advance consent. The Act vests the

Commission with authority to implement those restrictions.

In this case, a number of regulated entities seek review of

a 2015 order in which the Commission sought to clarify

various aspects of the TCPA’s general bar against using

automated dialing devices to make uninvited calls. The

challenges encompass four issues addressed by the agency’s

order: (i) which sorts of automated dialing equipment are

subject to the TCPA’s restrictions on unconsented calls; (ii)

when a caller obtains a party’s consent, does a call

nonetheless violate the Act if, unbeknownst to the caller, the

consenting party’s wireless number has been reassigned to a

different person who has not given consent; (iii) how may a

consenting party revoke her consent; and (iv) did the

Commission too narrowly fashion an exemption from the

TCPA’s consent requirement for certain healthcare-related

calls.

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We uphold the Commission’s approach to revocation of

consent, under which a party may revoke her consent through

any reasonable means clearly expressing a desire to receive

no further messages from the caller. We also sustain the

scope of the agency’s exemption for time-sensitive healthcare

calls.

We set aside, however, the Commission’s effort to clarify

the types of calling equipment that fall within the TCPA’s

restrictions. The Commission’s understanding would appear

to subject ordinary calls from any conventional smartphone to

the Act’s coverage, an unreasonably expansive interpretation

of the statute. We also vacate the agency’s approach to calls

made to a phone number previously assigned to a person who

had given consent but since reassigned to another

(nonconsenting) person. The Commission concluded that

calls in that situation violate the TCPA, apart from a one-call

safe harbor, regardless of whether the caller has any

awareness of the reassignment. We determine that the

agency’s one-call safe harbor, at least as defended in the

order, is arbitrary and capricious.

We therefore grant the petitions for review in part and

deny them in part.

I.

The federal government’s efforts to combat unwanted

robocalls have spanned nearly three decades, involving two

federal agencies and a number of congressional enactments.

In the Telemarketing and Consumer Fraud and Abuse

Prevention Act of 1994, 15 U.S.C. § 6101 et seq., Congress

empowered the Federal Trade Commission to regulate the

telemarketing industry. The FTC’s measures include a

general bar against calling any telephone number on the “do-

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not-call registry” without consent or an established business

relationship. 16 C.F.R. § 310.4(b)(1)(iii)(B); see 15 U.S.C.

§ 6151(a). This case does not concern the FTC’s initiatives.

This case instead concerns the Federal Communications

Commission’s efforts to combat unwanted robocalls pursuant

to its authority under the TCPA. Some of the Commission’s

restrictions on telemarketing calls mirror measures established

by the FTC. Compare 16 C.F.R. §§ 310.4(b)(1)(iii)(B),

310.4(c), with 47 C.F.R. § 64.1200(c). But the agencies’

initiatives also differ in various respects. Of relevance here,

only the TCPA specifically restricts the use of an “automatic

telephone dialing system” to make calls. 47 U.S.C.

§ 227(b)(1)(A). Petitioners challenge the Commission’s

interpretation and implementation of various TCPA

provisions pertaining to automated dialing equipment.

A.

Congress enacted the TCPA in 1991 based on findings

that the “use of the telephone to market goods and services to

the home and other businesses” had become “pervasive due to

the increased use of cost-effective telemarketing techniques.”

47 U.S.C. § 227 note, Pub. L. No. 102-243, § 2(1), 105 Stat.

2394, 2394. “Many consumers,” Congress determined, “are

outraged over the proliferation of intrusive, nuisance calls to

their homes from telemarketers.” Id. § 2(6)-(7).

The TCPA restricts calls both “to any residential

telephone line” and to “any telephone number assigned to a

. . . cellular telephone service.” 47 U.S.C. § 227(b)(1)(A)(iii),

(B). This case solely concerns the latter restrictions on

telephone calls to wireless numbers.

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Congress, in that regard, made it “unlawful . . . to make

any call (other than a call made for emergency purposes or

made with the prior express consent of the called party) using

any automatic telephone dialing system . . . to any telephone

number assigned to a . . . cellular telephone service,” “unless

such call is made solely to collect a debt owed to or

guaranteed by the United States.” Id. § 227(b)(1)(A)(iii).

The statute defines an “automatic telephone dialing system”

(ATDS, or autodialer) as “equipment which has the

capacity—(A) to store or produce telephone numbers to be

called, using a random or sequential number generator; and

(B) to dial such numbers.” Id. § 227(a)(1).

In short, the TCPA generally makes it unlawful to call a

cell phone using an ATDS. And an ATDS is equipment with

the “capacity” to perform each of two enumerated functions:

(i) storing or producing telephone numbers “using a random

or sequential number generator” and (ii) dialing those

numbers. The general prohibition on autodialer calls to

wireless numbers is subject to three exceptions. The central

exception for purposes of this case is for calls made with

“prior express consent.” There are also exceptions for

emergency calls and calls made to collect government debts.

The TCPA vests the Commission with responsibility to

promulgate regulations implementing the Act’s requirements.

Id. § 227(b)(2). The Act also grants the Commission specific

authority to fashion exemptions from the general prohibition

on autodialer calls to wireless numbers, where the calls are

“not charged to the called party.” Id. § 227(b)(2)(C). As

Congress explained, the FCC “should have the flexibility to

design different rules for those types of automated or

prerecorded calls that it finds are not considered a nuisance or

invasion of privacy.” Id. § 227 note, Pub. L. No. 102-243,

§ 2(13), 105 Stat. 2394, 2395.

8

Since the TCPA’s enactment, the FCC has issued a series

of rulemakings and declaratory rulings addressing the Act’s

reach. In 2003, for instance, the agency concluded that the

statute’s restrictions on “mak[ing] any call” using an ATDS

encompass the sending of text messages. See In re Rules and

Regulations Implementing the Telephone Consumer

Protection Act of 1991 (2003 Order), 18 FCC Rcd. 14,014,

14,115 ¶ 165 (2003).

The Act contains a private right of action permitting

aggrieved parties to recover at least $500 in damages for each

call made (or text message sent) in violation of the statute,

and up to treble damages for each “willful[] or knowing[]”

violation. 47 U.S.C. § 227(b)(3). There is no cap on the

amount of recoverable damages. The Commission has noted

a surge in TCPA lawsuits (including class actions) in recent

years, likely attributable in part to the “skyrocketing growth

of mobile phones.” In re Rules and Regulations

Implementing the Telephone Consumer Protection Act of

1991 (2015 Declaratory Ruling), 30 FCC Rcd. 7961, 7970

¶¶ 6-7 (2015).

B.

In a Declaratory Ruling and Order issued in 2015, the

Commission (with two Commissioners dissenting) addressed

21 separate petitions for rulemaking or requests for

clarification. In this court, petitioners and intervenors seek

review of four aspects of the Commission’s order.

First, the Commission sought to clarify which devices for

making calls qualify as an ATDS—i.e., equipment that “has

the capacity” to “store or produce telephone numbers to be

called, using a random or sequential number generator,” and

“to dial such numbers.” 47 U.S.C. § 227(a)(1). With regard

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to whether equipment has the “capacity” to perform the

enumerated functions, the Commission declined to define a

device’s “capacity” in a manner confined to its “present

capacity.” Instead, the agency construed a device’s

“capacity” to encompass its “potential functionalities” with

modifications such as software changes. 2015 Declaratory

Ruling, 30 FCC Rcd. at 7974 ¶ 16.

The Commission also addressed the precise functions that

a device must have the capacity to perform for it to be

considered an ATDS. The Commission reaffirmed prior

orders deciding that “predictive dialers”—equipment that can

dial automatically from a given list of telephone numbers

using algorithms to predict “when a sales agent will be

available”—qualify as autodialers. Id. at 7972 ¶ 10 & n.39.

The Commission further explained that a “basic function[]” of

an autodialer is to “dial numbers without human

intervention.” Id. at 7975 ¶ 17. At the same time, the

Commission also declined to “clarify[] that a dialer is not an

autodialer unless it has the capacity to dial numbers without

human intervention.” Id. at 7976 ¶ 20.

Second, the Commission spoke to whether, and when, a

caller violates the TCPA by calling a wireless number that has

been reassigned from a consenting party to another person

without the caller’s knowledge. The Act specifically permits

autodialer calls “made with the prior express consent of the

called party.” 47 U.S.C. § 227(b)(1)(A). If the “called party”

for those purposes refers to the intended recipient of a call or

message, a caller would face no liability when using an ATDS

to call a number believed to belong to a consenting party,

even if the number in fact has been reassigned to another

person who has not consented.

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The Commission, though, determined that the term

“called party” refers not to “the intended recipient of a call”

but instead to “the current subscriber” (i.e., the current,

nonconsenting holder of a reassigned number rather than a

consenting party who previously held the number). 2015

Declaratory Ruling, 30 FCC Rcd. at 7999 ¶ 72. But the

Commission did not hold a caller strictly liable when unaware

that the consenting party’s number has been reassigned to

another person. Instead, the agency allowed one—and only

one—liability-free, post-reassignment call for callers who

lack “knowledge of [the] reassignment” and possess “a

reasonable basis to believe that they have valid consent.” Id.

at 8000 ¶ 72.

Third, the Commission clarified the ways in which a

consenting party can revoke her consent to receive autodialer

calls. The Commission decided that callers may not

unilaterally designate the acceptable means of revocation. It

also declined to prescribe its own set of mandatory revocation

procedures. Rather, it concluded that “a called party may

revoke consent at any time and through any reasonable

means”—whether orally or in writing—“that clearly

expresses a desire not to receive further messages.” Id. at

7989-90 ¶ 47; id. at 7996 ¶ 63.

Fourth, and finally, the Commission exempted from the

autodialer provision’s consent requirement certain calls to

wireless numbers “for which there is exigency and that have a

healthcare treatment purpose.” Id. at 8031 ¶ 146. It declined,

however, to give the exemption the reach desired by certain

parties that are in the business of healthcare-related marketing

calls.

We will take up the challenges to those four aspects of

the Commission’s 2015 ruling in the same order.

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II.

Under the Administrative Procedure Act, we assess

whether the Commission’s challenged actions in its 2015

order were “arbitrary, capricious, an abuse of discretion, or

otherwise not in accordance with law.” 5 U.S.C. § 706(2)(A).

We review the lawfulness of the Commission’s interpretations

of the TCPA using the two-step Chevron framework. That

inquiry calls for examining whether “Congress has directly

spoken to the precise question at issue,” and, if not, whether

“the agency’s answer is based on a permissible construction

of the statute.” Chevron U.S.A. Inc. v. Nat’l Res. Def.

Council, Inc., 467 U.S. 837, 842-43 (1984).

To be lawful, the Commission’s challenged actions must

also satisfy the Administrative Procedure Act’s requirement

that they not be arbitrary or capricious. Arbitrary-and-

capricious review includes assuring that the agency “engaged

in reasoned decisionmaking.” Judulang v. Holder, 565 U.S.

42, 53 (2011). Review of agency action for arbitrariness and

capriciousness sometimes entails essentially the same inquiry

as review of an agency’s exercise of statutory interpretation

under Chevron’s second step. See id. at 52 n.7; Agape

Church, Inc. v. FCC, 738 F.3d 397, 410 (D.C. Cir. 2013).

Applying those standards to petitioners’ four sets of

challenges to the Commission’s 2015 Declaratory Ruling, we

set aside the Commission’s explanation of which devices

qualify as an ATDS, as well as its understanding of when a

caller violates the Act by calling a wireless number previously

held by a consenting party but reassigned to a person who has

not given consent. We sustain, however, the Commission’s

ruling that a party can revoke consent through any reasonable

means clearly expressing a desire to receive no further calls or

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texts, and we also uphold the scope of the Commission’s

exemption for time-sensitive, healthcare-related calls.

A.

We first consider the Commission’s effort to clarify

which sorts of calling equipment qualify as an ATDS so as to

fall subject to the general prohibition against making calls

using such a device without consent. The statute defines an

ATDS as “equipment which has the capacity—(A) to store or

produce telephone numbers to be called, using a random or

sequential number generator; and (B) to dial such numbers.”

47 U.S.C § 227(a)(1). That definition naturally raises two

questions: (i) when does a device have the “capacity” to

perform the two enumerated functions; and (ii) what precisely

are those functions? We conclude that the Commission’s

approach to those two questions cannot be sustained, at least

given the Commission’s unchallenged assumption that a call

made with a device having the capacity to function as an

autodialer can violate the statute even if autodialer features

are not used to make the call.

1.

a. In addressing what it means for equipment to have the

“capacity” to perform the autodialer functions enumerated in

the statute, the Commission rejected the arguments of various

parties that a device’s capacity must be measured solely by

reference to its “present capacity” or its “current

configuration” without any modification. 2015 Declaratory

Ruling, 30 FCC Rcd. at 7974 ¶ 16. The Commission instead

determined that the “capacity” of calling equipment “includes

its potential functionalities” or “future possibility,” not just its

“present ability.” Id. at 7974 ¶ 16; id. at 7975 ¶ 20.

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The Commission reasoned that the “functional capacity

of software-controlled equipment is designed to be flexible,

both in terms of features that can be activated or de-activated

and in terms of features that can be added to the equipment’s

overall functionality through software changes or updates.”

Id. at 7974 ¶ 16 n.63. And the Commission found support for

its “potential functionalities” approach in dictionary

definitions of the term “capacity,” one of which is “the

potential or suitability for holding, storing, or

accommodating.” Id. at 7975 ¶ 19 (quoting Capacity,

Merriam-Webster Dictionary Online, https://www.merriam-

webster.com/dictionary/capacity (as visited May 18, 2015)).

In challenging the Commission’s approach, petitioners

argue that the term “capacity” in the statutory definition of an

ATDS can refer only to a device’s “present ability,” i.e., its

current and unmodified state, not its “potential ability” taking

into account possible upgrades or modifications. It is far from

clear, though, that labels such as “present” ability versus

“potential” ability should carry dispositive weight in assessing

the meaning of the statutory term “capacity.” After all, even

under the ostensibly narrower, “present ability” interpretation

advanced by petitioners, a device that “presently” (and

generally) operates as a traditional telephone would still be

considered have the “capacity” to function as an ATDS if it

could assume the requisite features merely upon touching a

button on the equipment to switch it into autodialer mode.

Virtually any understanding of “capacity” thus contemplates

some future functioning state, along with some modifying act

to bring that state about.

Consequently, the question whether equipment has the

“capacity” to perform the functions of an ATDS ultimately

turns less on labels such as “present” and “potential” and

more on considerations such as how much is required to

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enable the device to function as an autodialer: does it require

the simple flipping of a switch, or does it require essentially a

top-to-bottom reconstruction of the equipment? And

depending on the answer, what kinds (and how broad a swath)

of telephone equipment might then be deemed to qualify as an

ATDS subject to the general bar against making any calls

without prior express consent?

b. Here, the Commission adopted an expansive

interpretation of “capacity” having the apparent effect of

embracing any and all smartphones: the device routinely used

by the vast majority of citizens to make calls and send

messages (and for many people, the sole phone equipment

they own). It is undisputed that essentially any smartphone,

with the addition of software, can gain the statutorily

enumerated features of an autodialer and thus function as an

ATDS. The Commission in its ruling did not question the

observation of a dissenting Commissioner that “[i]t’s trivial to

download an app, update software, or write a few lines of

code that would modify a phone to dial random or sequential

numbers.” 2015 Declaratory Ruling, 30 FCC Rcd. at 8075

(Comm’r Pai, dissenting). The Commission itself noted that

“[d]ialing options” are now “available via smartphone apps”

that enable “[c]alling and texting consumers en masse.” Id. at

7970 ¶ 7.

The Commission’s ruling concluded that app downloads

and other software additions of that variety—and the

enhanced functionality they bring about—are appropriately

considered to be within a device’s “capacity.” The ruling

states that equipment’s “functional capacity” includes

“features that can be added . . . through software changes or

updates.” Id. at 7974 ¶ 16 n.63. As a result, “a piece of

equipment can possess the requisite ‘capacity’ to satisfy the

statutory definition of an ‘autodialer’ even if, for example, it

15

requires the addition of software to actually perform the

functions described in the definition.” Id. at 7975 ¶ 18. The

Commission reinforced the point in an example set forth in its

brief in this case: “If I ask whether the Firefox browser has

the ‘capacity’ to play Flash videos, it would be natural for you

to answer ‘Yes, if you download the Flash plug-in’—and it

would be incorrect for you to answer ‘No.’” FCC Br. 29.

If a device’s “capacity” includes functions that could be

added through app downloads and software additions, and if

smartphone apps can introduce ATDS functionality into the

device, it follows that all smartphones, under the

Commission’s approach, meet the statutory definition of an

autodialer. The Commission’s ruling does not deny that

conclusion.

To the contrary, a number of parties specifically argued

to the agency “that a broad interpretation of ‘capacity’ could

potentially sweep in smartphones because they may have the

capacity to store telephone numbers to be called and to dial

such numbers through the use of an app or other software.”

2015 Declaratory Ruling, 30 FCC Rcd. at 7976 ¶ 21. Rather

than resist that contention, the Commission assumed its

correctness, responding that, even if smartphones qualify as

autodialers, it was unclear to the Commission that the “typical

use of smartphones” would be “likely” to give rise to

“unwanted calls” of a kind producing “legal action.” Id. at

7977 ¶ 21. A dissenting Commissioner read that portion of

the Commission’s order to “acknowledge[] that smartphones

are swept in under its reading,” such that “each and every

smartphone . . . is an automatic telephone dialing system.” Id.

at 8075 & n.576 (Comm’r Pai, dissenting). The Commission

did not disagree or suggest otherwise.

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c. If every smartphone qualifies as an ATDS, the

statute’s restrictions on autodialer calls assume an eye-

popping sweep. Recall that the statute generally bars the use

of an ATDS to make any call (or send any text message)

without prior express consent, and tags each violation with a

minimum $500 penalty in damages for each individual

recipient of each prohibited call or message. The reach of the

statute becomes especially pronounced upon recognizing that,

under the Commission’s approach, an uninvited call or

message from a smartphone violates the statute even if

autodialer features were not used to make the call or send the

message. Id. at 7976 ¶ 19 n.70. We explore that interpretive

issue in greater depth below (infra § II.A.3); but for now, it

suffices to appreciate the Commission’s understanding that, as

long as equipment has the “capacity” to function as an

autodialer—as is true of every smartphone under the agency’s

view—any uninvited call or message from the device is a

statutory violation.

Imagine, for instance, that a person wishes to send an

invitation for a social gathering to a person she recently met

for the first time. If she lacks prior express consent to send

the invitation, and if she obtains the acquaintance’s cell phone

number from a mutual friend, she ostensibly commits a

violation of federal law by calling or sending a text message

from her smartphone to extend the invitation. See 2015

Declaratory Ruling, 30 FCC Rcd. at 8076 (Comm’r Pai,

dissenting). And if she sends a group message inviting ten

people to the gathering, again without securing prior express

consent from any of the recipients, she not only would have

infringed the TCPA ten distinct times but would also face a

minimum damages recovery against her of $5,000.

Those sorts of anomalous outcomes are bottomed in an

unreasonable, and impermissible, interpretation of the

17

statute’s reach. The TCPA cannot reasonably be read to

render every smartphone an ATDS subject to the Act’s

restrictions, such that every smartphone user violates federal

law whenever she makes a call or sends a text message

without advance consent.

A “significant majority of American adults” owned a

smartphone even by 2013. Riley v. California, 134 S. Ct.

2473, 2484 (2014). And as of the end of 2016, nearly 80% of

American adults had become smartphone owners. See 10

Facts About Smartphones as the iPhone Turns 10, Pew

Research Ctr., June 28, 2017,

http://www.pewresearch.org/fact-tank/2017/06/28/10-facts-

about-smartphones (last visited Dec. 18, 2017). That figure

will only continue to grow, and increasingly, individuals own

no phone equipment other than a smartphone. See id.;

Wireless Substitution: Early Release of Estimates From the

National Health Interview Survey, January–June 2017, Nat’l

Ctr. for Health Statistics 1 (Dec. 2017),

https://www.cdc.gov/nchs/data/nhis/earlyrelease/wireless2017

05.pdf.

It is untenable to construe the term “capacity” in the

statutory definition of an ATDS in a manner that brings

within the definition’s fold the most ubiquitous type of phone

equipment known, used countless times each day for routine

communications by the vast majority of people in the country.

It cannot be the case that every uninvited communication

from a smartphone infringes federal law, and that nearly every

American is a TCPA-violator-in-waiting, if not a violator-in-

fact.

In that regard, it is notable that Congress, in its findings

setting forth the basis for the statute, found that some “30,000

businesses actively telemarket goods and services to business

18

and residential customers” and “[m]ore than 300,000

solicitors call more than 18,000,000 Americans every day.”

47 U.S.C. § 227 note, Pub. L. No. 102-243, § 2(2)-(3), 105

Stat. 2394, 2394. Those sorts of predicate congressional

findings can shed substantial light on the intended reach of a

statute. See Sutton v. United Airlines, Inc., 527 U.S. 471,

484-87 (1999).

Of course, there is no expectation that a statute’s reach

necessarily will precisely match Congress’s findings about a

problem it aims to address, and Congress might well fashion a

statute’s operative provisions with built-in flexibility to

accommodate expansion of the concerns animating the

legislation over time. But a several-fold gulf between

congressional findings and a statute’s suggested reach can call

into doubt the permissibility of the interpretation in

consideration.

That is what happened in Sutton. There, the Supreme

Court rejected an interpretation of the term “disability” in the

Americans with Disabilities Act that would have treated some

160 million persons as disabled in the face of congressional

findings contemplating the population of disabled persons as

numbering only 43 million. See id.; id. at 494-95 (Ginsburg,

J., concurring). (After Sutton, Congress amended the

statutory findings and the statute to allow for an expansive

application. See ADA Amendments Act of 2008, Pub. L. No.

110-325, § 2, 122 Stat. 3553, 3554.)

Here, as in Sutton, the Commission’s expansive

understanding of “capacity” in the TCPA is incompatible with

a statute grounded in concerns about hundreds of thousands of

“solicitors” making “telemarketing” calls on behalf of tens of

thousands of “businesses.” The Commission’s interpretation

would extend a law originally aimed to deal with hundreds of

19

thousands of telemarketers into one constraining hundreds of

millions of everyday callers.

The Commission’s capacious understanding of a device’s

“capacity” lies considerably beyond the agency’s zone of

delegated authority for purposes of the Chevron framework.

As we have explained, “even if the [statute] does not

foreclose the Commission’s interpretation, the interpretation

[can] fall[] outside the bounds of reasonableness” at

Chevron’s second step. Goldstein v. SEC, 451 F.3d 873, 880-

81 (D.C. Cir. 2006). That is because an “agency[’s]

construction of a statute cannot survive judicial review if a

contested regulation reflects an action that exceeds the

agency’s authority.” Id. (quoting Aid Ass’n for Lutherans v.

United States Postal Serv., 321 F.3d 1166, 1174 (D.C. Cir.

2003)).

In Aid Ass’n, for example, we examined Postal Service

regulations that excluded nonprofit organizations’ use of

certain reduced postage rates. We found the regulations to be

incompatible with congressional intent. The regulations, we

said, “constitute an impermissible construction of the statute

under Chevron Step Two because the interpretation is utterly

unreasonable in the breadth of its regulatory exclusion.” 321

F.3d at 1178.

In this case, similarly, the Commission’s interpretation of

the term “capacity” in the statutory definition of an ATDS is

“utterly unreasonable in the breadth of its regulatory

[in]clusion.” Id. Nothing in the TCPA countenances

concluding that Congress could have contemplated the

applicability of the statute’s restrictions to the most

commonplace phone device used every day by the

overwhelming majority of Americans.

20

The Commission suggested in its ruling that, unless

“capacity” reached so broadly, “little or no modern dialing

equipment would fit the statutory definition.” 2015

Declaratory Ruling, 30 FCC Rcd. at 7976 ¶ 20. But Congress

need not be presumed to have intended the term “automatic

telephone dialing system” to maintain its applicability to

modern phone equipment in perpetuity, regardless of

technological advances that may render the term increasingly

inapplicable over time. After all, the statute also generally

prohibits nonconsensual calls to numbers associated with a

“paging service” or “specialized mobile radio service,” 47

U.S.C. § 227(b)(1)(A)(iii), yet those terms have largely

ceased to have practical significance.

In any event, the Commission retains a measure of

authority under the TCPA to fashion exemptions to the

restrictions on use of autodialers to call wireless numbers. Id.

§ 227(b)(2)(C). The agency presumably could, if needed,

fashion exemptions preventing a result under which every

uninvited call or message from a standard smartphone would

violate the statute.

d. In its briefing before our court, the Commission now

submits that its order in fact did not reach a definitive

resolution on whether smartphones qualify as autodialers.

As we have explained, however, a straightforward reading of

the Commission’s ruling invites the conclusion that all

smartphones are autodialers: the ruling explained that a

number of parties specifically raised the issue; and it

responded, not by disputing the parties’ concerns that

smartphones would be covered by the statutory definition

under the agency’s approach, but instead by accepting that

conclusion and then questioning whether uninvited calls in

fact would be made and lawsuits in fact would be brought.

21

It is highly difficult to read the Commission’s ruling to

leave uncertain whether the statutory definition applies to

smartphones. And any uncertainty on that score would have

left affected parties without concrete guidance even though

several of them specifically raised the issue with the agency,

and even though the issue carries significant implications—

including the possibility of committing federal law violations

and incurring substantial liability in damages—for

smartphone owners.

At any rate, even assuming the Commission’s ruling

could be conceived to leave room for concluding that

smartphones do not qualify as autodialers, that result itself

would be unreasonable and impermissible. The

Commission’s order, in that event, would not constitute

reasoned decisionmaking and thus would not satisfy APA

arbitrary-and-capricious review. See United States Postal

Serv. v. Postal Regulatory Comm’n, 785 F.3d 740, 754 (D.C.

Cir. 2015).

Administrative action is “arbitrary and capricious [if] it

fails to articulate a comprehensible standard” for assessing the

applicability of a statutory category. Id. at 753. If a

“purported standard is indiscriminate and offers no

meaningful guidance” to affected parties, it will fail “the

requirement of reasoned decisionmaking.” Id. at 754. That

will be the case if an agency cannot satisfactorily explain why

a challenged standard embraces one potential application but

leaves out another, seemingly similar one. See id. at 754-55.

That would be precisely the situation here if, as the

Commission now contends in its briefing before us, its order

in fact left open the possibility that smartphones fail to meet

the statutory definition of an ATDS. In the same briefing, the

Commission, as noted, simultaneously maintained that the

22

Firefox browser has the “capacity” to play Flash videos

because the Flash plug-in can be downloaded. Precisely the

same logic seemingly should compel concluding that

smartphones have the “capacity” to function as autodialers

because apps carrying the requisite features can be

downloaded. If the Commission believes smartphones

nonetheless do not meet the definition of an autodialer, there

is no explanation of “this differential treatment of seemingly

like cases.” Id. at 755 (internal quotation marks omitted).

The Commission did say in its order that “there must be

more than a theoretical potential that the equipment could be

modified to satisfy the ‘autodialer’ definition.” 2015

Declaratory Ruling, 30 FCC Rcd. at 7975 ¶ 18. But that

ostensible limitation affords no ground for distinguishing

between a smartphone and the Firefox browser. In light of the

ease of downloading an app to a smartphone, there is no

evident basis for concluding that the Firefox browser has

more than a mere “theoretical potential” to play Flash videos

by downloading a plug-in, but a smartphone nonetheless has

only a “theoretical potential” to function as an autodialer by

downloading an app.

The point is fortified by the sole example of a mere

“theoretical potential” set forth by the Commission in its

order. That example involves a traditional rotary-dial phone

(which by now is approaching obsolescence): the

Commission observed that “it might be theoretically possible

to modify a rotary-dial telephone to such an extreme that it

would satisfy the definition of ‘autodialer,’ but such a

possibility is too attenuated . . . to find that a rotary-dial phone

has the requisite ‘capacity’ and therefore is an autodialer.” Id.

A rotary phone has no relevant similarity to a smartphone. To

the contrary, whereas a smartphone and the Firefox browser

substantially resemble one another in their amenability to an

23

upgrade via the addition of software, they substantially differ

in that regard from a rotary-dial phone, which has no such

capability.

In the end, then, the Commission’s order cannot

reasonably be understood to support the conclusion that

smartphones fall outside the TCPA’s autodialer definition:

any such reading would compel concluding that the agency’s

ruling fails arbitrary-and-capricious review. The more

straightforward understanding of the Commission’s ruling is

that all smartphones qualify as autodialers because they have

the inherent “capacity” to gain ATDS functionality by

downloading an app. That interpretation of the statute, for all

the reasons explained, is an unreasonably, and impermissibly,

expansive one.

2.

Recall that the statutory definition of an ATDS raises two

sets of questions: (i) when does a device have the “capacity”

to perform the functions of an autodialer enumerated by the

statute?; and (ii) what precisely is the content of those

functions? The impermissibility of the Commission’s

interpretation of the term “capacity” in the autodialer

definition is compounded by inadequacies in the agency’s

explanation of the requisite features. Having addressed the

first issue, we now turn to the second one.

a. As a threshold matter, the Commission maintains that

the court lacks jurisdiction to entertain petitioners’ challenge

concerning the functions a device must be able to perform.

The agency reasons that the issue was resolved in prior

agency orders—specifically, declaratory rulings in 2003 and

2008 concluding that the statutory definition of an ATDS

includes “predictive dialers,” dialing equipment that can make

24

use of algorithms to “assist[] telemarketers in predicting when

a sales agent will be available to take calls.” 2015

Declaratory Ruling, 30 FCC Rcd. at 7972 ¶ 10 n.39; see also

In re Rules and Regulations Implementing the Telephone

Consumer Protection Act of 1991 (2008 Declaratory Ruling),

23 FCC Rcd. 559 (2008); 2003 Order, 18 FCC Rcd. 14,014.

According to the Commission, because there was no timely

appeal from those previous orders, it is too late now to raise a

challenge by seeking review of a more recent declaratory

ruling that essentially ratifies the previous ones. We disagree.

While the Commission’s latest ruling purports to reaffirm

the prior orders, that does not shield the agency’s pertinent

pronouncements from review. The agency’s prior rulings left

significant uncertainty about the precise functions an

autodialer must have the capacity to perform. Petitioners

covered their bases by filing petitions for both a declaratory

ruling and a rulemaking concerning that issue and related

ones. See, e.g., Prof’l Ass’n for Customer Engagement, Inc.

Pet. 3-4; ACA Int’l Pet. 6; GroupMe, Inc. Pet. 3; Glide Talk,

Ltd. Pet. 13. In response, the Commission issued a

declaratory ruling that purported to “provid[e] clarification on

the definition of ‘autodialer,’” and denied the petitions for

rulemaking on the issue. 2015 Declaratory Ruling, 30 FCC

Rcd. at 8039 ¶ 165 & n.552. The ruling is thus reviewable on

both grounds. See 5 U.S.C. § 554(e); Biggerstaff v. FCC, 511

F.3d 178, 184-85 (D.C. Cir. 2007).

b. The statutory definition says that a device constitutes

an ATDS if it has the capacity to perform both of two

enumerated functions: “to store or produce telephone

numbers to be called, using a random or sequential number

generator”; and “to dial such numbers.” 47 U.S.C.

§ 227(a)(1)(A)-(B). The role of the phrase, “using a random

or sequential number generator,” has generated substantial

25

questions over the years. The Commission has sought to

address those questions in previous orders and did so again in

the 2015 Declaratory Ruling we consider here.

The Commission’s most recent effort falls short of

reasoned decisionmaking in “offer[ing] no meaningful

guidance” to affected parties in material respects on whether

their equipment is subject to the statute’s autodialer

restrictions. Postal Regulatory Comm’n, 785 F.3d at 754. A

basic question raised by the statutory definition is whether a

device must itself have the ability to generate random or

sequential telephone numbers to be dialed. Or is it enough if

the device can call from a database of telephone numbers

generated elsewhere? The Commission’s ruling appears to be

of two minds on the issue.

In certain respects, the order conveys that equipment

needs to have the ability to generate random or sequential

numbers that it can then dial. The order twice states that, to

“meet[] the TCPA’s definition of ‘autodialer,’” the equipment

in question must have the capacity to “dial random or

sequential numbers.” 2015 Declaratory Ruling, 30 FCC Rcd.

at 7972 ¶ 10; see also id. at 7974 ¶ 15. And it is clear from

context that the order treats the ability to “dial random or

sequential numbers” as the ability to generate and then dial

“random or sequential numbers.”

To see why, it is helpful to understand that the ruling

distinguishes between use of equipment to “dial random or

sequential numbers” and use of equipment to “call[] a set list

of consumers.” Id. at 7972 ¶ 10. Anytime phone numbers are

dialed from a set list, the database of numbers must be called

in some order—either in a random or some other sequence.

As a result, the ruling’s reference to “dialing random or

sequential numbers” cannot simply mean dialing from a set

26

list of numbers in random or other sequential order: if that

were so, there would be no difference between “dialing

random or sequential numbers” and “dialing a set list of

numbers,” even though the ruling draws a divide between the

two. See id. at 7973 ¶¶ 13, 14. It follows that the ruling’s

reference to “dialing random or sequential numbers” means

generating those numbers and then dialing them.

The Commission’s prior declaratory rulings reinforce that

understanding. In its 2003 ruling addressing predictive

dialers, the Commission observed that, “[i]n the past,

telemarketers may have used dialing equipment to create and

dial 10-digit telephone numbers arbitrarily.” 2003 Order, 18

FCC Rcd. at 14,092 ¶ 132 (emphasis added). But the industry

had “progressed to the point where” it had become “far more

cost effective” instead to “us[e] lists of numbers.” Id. Again,

the Commission suggested it saw a difference between calling

from a list of numbers, on one hand, and “creating and

dialing” a random or arbitrary list of numbers, on the other

hand. Or as the Commission has elsewhere said, numbers that

are “randomly or sequentially generated” differ from numbers

that “come from a calling list.” In re Implementation of the

Middle Class Tax Relief and Job Creation Act of 2012, 27

FCC Rcd. 13,615, 13,629 ¶ 29 (2012) (quoted in 2015

Declaratory Ruling, 30 FCC Rcd. at 8077 (Comm’r Pai,

dissenting)).

While the 2015 ruling indicates in certain places that a

device must be able to generate and dial random or sequential

numbers to meet the TCPA’s definition of an autodialer, it

also suggests a competing view: that equipment can meet the

statutory definition even if it lacks that capacity. The

Commission reaffirmed its 2003 ruling insofar as that order

had found predictive dialers to qualify as ATDSs. 2015

Declaratory Ruling, 30 FCC Rcd. at 7972-73 ¶¶ 12-14. And

27

in the 2003 order, the Commission had made clear that, while

some predictive dialers cannot be programmed to generate

random or sequential phone numbers, they still satisfy the

statutory definition of an ATDS. 2003 Order, 18 FCC Rcd. at

14,091 ¶ 131 n.432; id. at 14,093 ¶ 133. By reaffirming that

conclusion in its 2015 ruling, the Commission supported the

notion that a device can be considered an autodialer even if it

has no capacity itself to generate random or sequential

numbers (and instead can only dial from an externally

supplied set of numbers). The 2015 ruling correspondingly

expresses that “predictive dialers” can differ from other

“dialers that utilize random or sequential numbers instead of a

list of numbers.” 2015 Declaratory Ruling, 30 FCC Rcd. at

7973 ¶ 14.

So which is it: does a device qualify as an ATDS only if

it can generate random or sequential numbers to be dialed, or

can it so qualify even if it lacks that capacity? The 2015

ruling, while speaking to the question in several ways, gives

no clear answer (and in fact seems to give both answers). It

might be permissible for the Commission to adopt either

interpretation. But the Commission cannot, consistent with

reasoned decisionmaking, espouse both competing

interpretations in the same order.

The choice between the interpretations is not without

practical significance. Petitioners and various amici describe

calling equipment that they wish to use to call set lists of

cellular numbers without any generation of random or

sequential numbers. See ACA Int’l Reply Br. 21; Am.

Bankers Ass’n Amicus Br. 29-30. And at least some

predictive dialers, as explained, have no capacity to generate

random or sequential numbers.

28

The uncertainty in the 2015 ruling, moreover, does not

stop with the question of whether a device must be able to

generate random or sequential numbers to meet the statutory

definition. The ruling is also unclear about whether certain

other referenced capabilities are necessary for a dialer to

qualify as an ATDS.

For instance, the ruling states that the “basic function” of

an autodialer is the ability to “dial numbers without human

intervention.” 2015 Declaratory Ruling, 30 FCC Rcd. at 7973

¶ 14; id. at 7975 ¶ 17. Prior orders had said the same. 2003

Order, 18 FCC Rcd. at 14,092 ¶ 132; 2008 Declaratory

Ruling, 23 FCC Rcd. at 566 ¶ 13. That makes sense given

that “auto” in autodialer—or, equivalently, “automatic” in

“automatic telephone dialing system,” 47 U.S.C.

§ 227(a)(1)—would seem to envision non-manual dialing of

telephone numbers.

But the Commission nevertheless declined a request to

“clarify[] that a dialer is not an autodialer unless it has the

capacity to dial numbers without human intervention.” 2015

Declaratory Ruling, 30 FCC Rcd. at 7976 ¶ 20. According to

the Commission, then, the “basic function” of an autodialer is

to dial numbers without human intervention, but a device

might still qualify as an autodialer even if it cannot dial

numbers without human intervention. Those side-by-side

propositions are difficult to square.

The Commission further said that another “basic

function[]” of an ATDS is to “dial thousands of numbers in a

short period of time.” Id. at 7975 ¶ 17. But the ruling imparts

no additional guidance concerning whether that is a necessary

condition, a sufficient condition, a relevant condition even if

neither necessary nor sufficient, or something else. Nor does

it indicate what would qualify as a “short period of time.”

29

Again, affected parties are left in a significant fog of

uncertainty about how to determine if a device is an ATDS so

as to bring into play the restrictions on unconsented calls.

In short, the Commission’s ruling, in describing the

functions a device must perform to qualify as an autodialer,

fails to satisfy the requirement of reasoned decisionmaking.

The order’s lack of clarity about which functions qualify a

device as an autodialer compounds the unreasonableness of

the Commission’s expansive understanding of when a device

has the “capacity” to perform the necessary functions. We

must therefore set aside the Commission’s treatment of those

matters.

3.

We briefly note an additional statutory provision

affecting the scope of the TCPA’s restrictions on autodialer

calls to cell numbers—a provision we ultimately have no

occasion to examine because of the way the case has been

presented to us. Two TCPA provisions work together to

establish the reach of the general prohibition against making

autodialer calls without prior consent. The first provision, as

we have seen, defines the equipment—viz., “automatic

telephone dialing system”—subject to the statutory

prohibition. 47 U.S.C. § 227(a)(1). The second provision

then incorporates that definition in setting out the scope of the

prohibition: “It shall be unlawful for any person . . . to make

any call (other than a call made for emergency purposes or

made with the prior express consent of the called party) using

any automatic telephone dialing system . . . to any telephone

number assigned to a . . . cellular telephone service[.]” Id.

§ 227(b)(1)(A)(iii) (emphases added).

30

Petitioners have confined their challenge to the

Commission’s understanding of the first of those provisions,

the statutory definition of an autodialer, and our analysis has

been focused on that issue. Petitioners have raised no

challenge to the Commission’s understanding of the second

provision—i.e., to the agency’s interpretation of what it

means to “make any call using any” ATDS. In particular, in

the case of a device having the “capacity” both to perform the

autodialer functions set out in the statutory definition and to

perform as a traditional phone, does the bar against “making

any call using” an ATDS apply only to calls made using the

equipment’s ATDS functionality? Or does the bar apply to all

calls made with a device having that “capacity,” even ones

made without any use of the equipment’s autodialer

capabilities? Or does the bar apply to calls made using

certain autodialer functions, even if not all of them?

The Commission’s ruling endorsed a broad

understanding under which the statute prohibits any calls

made from a device with the capacity to function as an

autodialer, regardless of whether autodialer features are used

to make a call. 2015 Declaratory Ruling, 30 FCC Rcd. at

7975 ¶ 19 n.70. A dissenting commissioner, by contrast, read

the pertinent statutory phrase, “make any call,” to mean “that

the equipment must, in fact, be used as an autodialer to make

the calls” before a TCPA violation can be found. Id. at 8088

(Comm’r O’Rielly, dissenting in part and approving in part).

The dissenting commissioner’s interpretation would

substantially diminish the practical significance of the

Commission’s expansive understanding of “capacity” in the

autodialer definition. Even if the definition encompasses any

device capable of gaining autodialer functionality through the

downloading of software, the mere possibility of adding those

features would not matter unless they were downloaded and

31

used to make calls. Under the dissent’s understanding of the

phrase, “make any call,” then, everyday calls made with a

smartphone would not infringe the statute: the fact that a

smartphone could be configured to function as an autodialer

would not matter unless the relevant software in fact were

loaded onto the phone and were used to initiate calls or send

messages.

Petitioners, however, raise no challenge to the

Commission’s understanding of the statutory words, “make

any call using” an ATDS, and the parties therefore have not

presented arguments on the issue in their briefing before us.

Our consistent practice in such a situation is to decline to

address (much less resolve) the issue. See, e.g., U.S. Telecom

Ass’n v. FCC, 825 F.3d 674, 697 (D.C. Cir. 2016). We “sit to

resolve only legal questions presented and argued by the

parties.” Id. (internal quotation marks omitted). We

nonetheless note the issue in light of its potential interplay

with the distinct challenges petitioners do raise. The agency

could choose to revisit the issue in a future rulemaking or

declaratory order, and a party might then raise the issue on

judicial review.

B.

We now turn to the Commission’s treatment of

circumstances in which a consenting party’s cell number has

been reassigned to another person. While there is no

consensus about the exact numbers of reassignments, there is

no dispute that millions of wireless numbers are reassigned

each year. In the event of a reassignment, the caller might

initiate a phone call (or send a text message) based on a

mistaken belief that the owner of the receiving number has

given consent, when in fact the number has been reassigned to

someone else from whom consent has not been obtained.

32

Does a call or message in that situation violate the

statutory bar against making autodialer calls without prior

consent? The Commission’s answer is yes, apart from a one-

call, post-reassignment safe harbor. We set aside the

Commission’s interpretation on the ground that the one-call

safe harbor is arbitrary and capricious.

1.

The pertinent statutory language generally renders it

unlawful “to make any call (other than a call made for

emergency purposes or made with the prior express consent

of the called party) using any automatic telephone dialing

equipment or prerecorded voice.” 47 U.S.C. § 227(b)(1)(A)

(emphasis added). The Commission, in its ruling, initially

addressed who is properly considered the “called party” when

a consenting party’s number is reassigned to another person:

does “called party” refer to the person the caller expected to

reach (whose consent had previously been obtained), or does

it refer to the person actually reached, the wireless number’s

present-day subscriber after reassignment (whose consent has

not been obtained)?

The Commission adopted the latter interpretation. 30

FCC Rcd. at 7999-8001 ¶¶ 72-73. The result is that the

reassignment of a wireless number extinguishes any consent

given by the number’s previous holder and exposes the caller

to liability for reaching a party who has not given consent.

An alternative approach, the Commission reasoned, would

“effectively require consumers to opt out of such calls when

the TCPA clearly requires the opposite—that consumers opt

in before they can be contacted.” Id. at 8004 ¶ 80.

The agency also refused to “place any affirmative

obligation” on new subscribers to inform callers that a

33

wireless number now belongs to someone else. Id. at 8011

¶ 95. The ruling thus expressly contemplates that a new

subscriber could “purposefully and unreasonably” refrain

from informing a good-faith caller about a number’s

reassignment “in order to accrue statutory penalties.” Id.

(formatting modified). In that regard, the Commission

described a reported case in which the new, post-reassignment

subscriber waited to initiate a lawsuit until after having

received almost 900 text alerts that were intended for the

previous subscriber. Id. at 8011 ¶ 94 & n.324.

The Commission acknowledged that even the most

careful caller, after employing all reasonably available tools

to learn about reassignments, “may nevertheless not learn of

reassignment before placing a call to a new subscriber.” Id. at

8009 ¶ 88. The Commission observed that it nonetheless

“could have interpreted the TCPA to impose a traditional

strict liability standard on the caller: i.e., a ‘zero call’

approach under which no allowance would have been given

for the robocaller to learn of the reassignment.” Id. at 8009

¶ 90 n.312. But the Commission declined to interpret the

statute “to require a result that severe.” Id. Rather, the

Commission read the statute to “anticipate[] the caller’s

ability to rely on prior express consent,” which the

Commission interpreted “to mean reasonable reliance.” Id.

(internal quotation marks omitted).

The Commission effectuated its “reasonable reliance”

approach by enabling a caller who lacks knowledge of a

reassignment “to avoid liability for the first call to a wireless

number following reassignment.” Id. at 8009 ¶ 89. For that

first call, the caller can continue to rely on the consent given

by the “previous subscriber.” Id. at 8003 ¶ 78. The

Commission did “not presume that a single call to a

reassigned number will always be sufficient for callers to gain

34

actual knowledge of the reassignment.” Id. at 8009 ¶ 90

n.312. But it believed that “[o]ne call represents an

appropriate balance between a caller’s opportunity to learn of

the reassignment and the privacy interests of the new

subscriber.” Id. at 8009 ¶ 90.

2.

In challenging the Commission’s resolution, petitioners

first contend that the statutory reference to the consent of the

“called party” refers to the expected recipient of a call or

message, not the actual recipient. When a wireless number is

reassigned without the caller’s awareness, petitioners’

interpretation would mean that a caller would avoid liability

for a post-reassignment call because the “called party”—the

former owner of the number—had given consent. In

petitioners’ view, the Commission’s contrary interpretation of

“called party” to refer to the new (post-reassignment)

subscriber is foreclosed by the statute. We disagree.

Another court of appeals has examined the meaning of

the term “called party” in the same statutory provision, 47

U.S.C. § 227(b)(1)(A), and in the same situation of a

reassigned wireless number formerly belonging to a

consenting party. Soppet v. Enhanced Recovery Co., 679 F.3d

637 (7th Cir. 2012). The Seventh Circuit explained that the

phrase “called party” appears throughout the broader statutory

section, 47 U.S.C. § 227, a total of seven times. 679 F.3d at

640. Four of those instances “unmistakably denote the

current subscriber,” not the previous, pre-reassignment

subscriber. Id. Of the three remaining instances, “one

denotes whoever answers the call (usually the [current]

subscriber),” and the other two are unclear. Id. By contrast,

the court observed, the “phrase ‘intended recipient’ does not

appear anywhere in § 227, so what justification could there be

35

for equating ‘called party’ with ‘intended recipient of the

call’?” Id. For those and other reasons, the court concluded

“that ‘called party’ in § 227(b)(1) means the person

subscribing to the called number at the time the call is made,”

not the previous subscriber who had given consent. Id. at

643; see also Osorio v. State Farm Bank, F.S.B., 746 F.3d

1242, 1250-52 (11th Cir. 2014).

We find the Seventh Circuit’s analysis persuasive insofar as

it supports concluding that the Commission was not

compelled to interpret “called party” in § 227(b)(1)(A) to

mean the “intended recipient” rather than the current

subscriber. The Commission thus could permissibly interpret

“called party” in that provision to refer to the current

subscriber.

3.

Petitioners next argue that the Commission’s one-call

safe harbor is arbitrary. On this score, we agree with

petitioners.

When a caller is unaware that a consenting party’s

wireless number has been reassigned, the Commission chose

to allow the caller to make one (and only one) post-

reassignment call without incurring liability. For that one

call, the Commission understood the statutory term “prior

express consent” to refer to the consent given by the previous

subscriber. 30 FCC Rcd. at 8001 ¶ 73 & n.265; id. at 8003

¶ 78.

The Commission allowed for that one liability-free call,

rather than impose “a traditional strict liability standard,”

because it interpreted a caller’s ability under the statute to rely

on a recipient’s “prior express consent” to “mean reasonable

36

reliance.” Id. at 8009 ¶ 90 n.312. And when a caller has no

knowledge of a reassignment, the Commission

understandably viewed the caller’s continued reliance on the

prior subscriber’s consent to be “reasonable.”

Elsewhere in the Declaratory Ruling, the Commission

echoed the same “reasonable reliance” understanding of the

statute’s approval of calls based on “prior express consent.”

The ruling accepts that a caller can rely on consent given by a

wireless number’s “customary user” (“such as a close relative

on a subscriber’s family calling plan”), rather than by the

subscriber herself. Id. at 8001 ¶ 75. That is because the

“caller in this situation cannot reasonably be expected to

divine that the consenting person is not the subscriber.” Id. at

8001-02 ¶ 75. The Commission reiterated in that regard that,

in “construing the term ‘prior express consent’ in section

227(b)(1)(A), we consider the caller’s reasonableness in

relying on consent.” Id. at 8001 ¶ 75.

The Commission thus consistently adopted a “reasonable

reliance” approach when interpreting the TCPA’s approval of

calls based on “prior express consent,” including as the

justification for allowing a one-call safe harbor when a

consenting party’s number is reassigned. The Commission,

though, gave no explanation of why reasonable-reliance

considerations would support limiting the safe harbor to just

one call or message. That is, why does a caller’s reasonable

reliance on a previous subscriber’s consent necessarily cease

to be reasonable once there has been a single, post-

reassignment call? The first call or text message, after all,

might give the caller no indication whatsoever of a possible

reassignment (if, for instance, there is no response to a text

message, as would often be the case with or without a

reassignment).

37

The Commission outlined a number of measures callers

could undertake “that, over time, may permit them to learn of

reassigned numbers.” Id. at 8007 ¶ 86. But the Commission

acknowledged that callers “may nevertheless not learn of

reassignment before placing a call to a new subscriber,” and

that the first post-reassignment call likewise might give no

reason to suspect a reassignment. Id. at 8009 ¶¶ 88, 90 n.312.

In that event, a caller’s reasonable reliance on the previous

subscriber’s consent would be just as reasonable for a second

call.

To be sure, the Commission stated that it found “no basis

in the statute or the record before [it] to conclude that callers

can reasonably rely on prior express consent beyond one call

to reassigned numbers.” Id. at 8009-10 ¶ 90 n.312. But the

Commission did not elaborate on—or otherwise support—its

conclusory observation to that effect. And the statement is

hard to square with the Commission’s concession that the first

call may give no notice of a reassignment, or with the

Commission’s disavowal of any expectation that a caller

should “divine from the called consumer’s mere silence the

current status of a telephone number.” Id. (brackets omitted).

In that light, no cognizable conception of “reasonable

reliance” supports the Commission’s blanket, one-call-only

allowance.

At times, the Commission indicated that its one-call safe

harbor intends to give callers additional “opportunity” to find

out about a possible reassignment. E.g., id. at 8009 ¶ 89; id.

at 8010 ¶ 91. There is no indication, though, that the interest

in giving callers such an opportunity is independent of the

interest in giving effect to a caller’s reasonable reliance.

After all, a caller also has an opportunity to learn of a

reassignment before the first call. The reason to allow even

one, liability-free, post-reassignment call—the reason the

38

Commission cared about affording an opportunity to learn

about reassignment at all—is in order to give effect to a

caller’s reasonable reliance on the previous subscriber’s

consent.

Indeed, the Commission’s one-call safe harbor applies

“over an unlimited period of time.” Id. at 8000 ¶ 72 n.257.

If the goal were simply to provide an expanded opportunity to

learn about a reassignment, the Commission presumably

would have allowed for a given period of time. It declined to

do so, id. at 8009 ¶ 89, opting instead to permit a single call

regardless of whether it occurs within minutes or months of a

reassignment.

For substantially the same reasons, the Commission’s

one-call-only approach cannot be salvaged by its suggestion

that callers rather than new subscribers should bear the risk

when calls are made (or messages are sent) to a reassigned

number. Id. at 8009-10 ¶ 90 n.312. That consideration would

equally support a zero-call, strict-liability rule. But the

Commission specifically declined to adopt “a result that

severe.” Id. Having instead embraced an interpretation of the

statutory phrase “prior express consent” grounded in

conceptions of reasonable reliance, the Commission needed to

give some reasoned (and reasonable) explanation of why its

safe harbor stopped at the seemingly arbitrary point of a

single call or message. The Commission did not do so.

The Seventh Circuit’s decision in Soppet, discussed

earlier, is not to the contrary. There, the court assumed that

“any consent previously given . . . lapses when [a] [c]ell

[n]umber is reassigned.” 679 F.3d at 641. The court, though,

did not have before it an agency interpretation under which

the previous subscriber’s consent does not lapse with

reassignment: the premise of the Commission’s one-call safe

39

harbor is that a caller can continue to rely on the previous

subscriber’s consent. The question we face is, why should

that necessarily stop with a single call? Soppet does not speak

to that question, and so does not cast doubt on our conclusion

that the Commission failed to give it a satisfactory answer.

Finally, the Commission’s failure in that regard requires

setting aside not only its allowance of a one-call safe harbor,

but also its treatment of reassigned numbers more generally.

When we invalidate a specific aspect of an agency’s action,

we leave related components of the agency’s action standing

only if “we can say without any ‘substantial doubt’ that the

agency would have adopted the severed portion on its own.”

Am. Petroleum Inst. v. EPA, 862 F.3d 50, 71 (D.C. Cir. 2017)

(per curiam) (internal quotation marks omitted).

Here, we have no such assurance. If we were to excise

the Commission’s one-call safe harbor alone, that would leave

in place the Commission’s interpretation that “called party”

refers to the new subscriber. And that in turn would mean

that a caller is strictly liable for all calls made to the

reassigned number, even if she has no knowledge of the

reassignment.

We cannot be certain that the agency would have adopted

that rule in the first instance. Significantly, the Commission

said that it “could have interpreted the TCPA to impose a

traditional strict liability standard,” i.e., “a ‘zero call’

approach.” 30 FCC Rcd. at 8009 ¶ 90 n.312. But the agency

declined to “require a result that severe,” opting instead for a

one-call safe harbor. Id. We cannot say without any

substantial doubt that the agency would have embraced the

“severe” implications of a pure, strict-liability regime even in

the absence of any safe harbor. As a result, we must set aside

40

the Commission’s treatment of reassigned numbers as a

whole.

Notably, the Commission is already on its way to

designing a regime to avoid the problems of the 2015 ruling’s

one-call safe harbor. The Commission recently sought

comment on potential methods for “requir[ing] service

providers to report information about number reassignments

for the purposes of reducing unwanted robocalls.” In re

Advanced Methods to Target and Eliminate Unlawful

Robocalls, Second Notice of Inquiry, 32 FCC Rcd. 6007,

6010 ¶ 9 (2017). Most of its proposals envision creating a

comprehensive repository of information about reassigned

wireless numbers. See id. at 6012-13 ¶¶ 15-19. The

Commission is also considering whether to provide a safe

harbor for callers that inadvertently reach reassigned numbers

after consulting the most recently updated information. See

id. at 6012 ¶ 14. Those proposals would naturally bear on the

reasonableness of calling numbers that have in fact been

reassigned, and have greater potential to give full effect to the

Commission’s principle of reasonable reliance.

C.

It is undisputed that consumers who have consented to

receiving calls otherwise forbidden by the TCPA are entitled

to revoke their consent. See 2015 Declaratory Ruling, 30

FCC Rcd. at 7996 ¶ 62. The statute, however, does not

elaborate on the processes by which consumers may validly

do so. The Commission sought to resolve the matter in its

Declaratory Ruling.

The Commission had been petitioned to clarify that

callers can unilaterally prescribe the exclusive means for

consumers to revoke their consent. It explicitly denied that

41

request. Allowing “callers to designate the exclusive means

of revocation,” the Commission believed, could “materially

impair” the “right of revocation.” Id. at 7997 ¶ 66.

The Commission instead concluded that “a called party

may revoke consent at any time and through any reasonable

means”—orally or in writing—“that clearly expresses a desire

not to receive further messages.” Id. at 7989-90 ¶ 47; id. at

7996 ¶ 63. In assessing whether a revocation request meets

the “reasonable means” standard, the Commission said it

would consider “the totality of the facts and circumstances.”

Id. at 7996 ¶ 64 n.233. One relevant factor is “whether the

caller could have implemented mechanisms to effectuate a

requested revocation without incurring undue burdens.” Id.

Another consideration is “whether the consumer had a

reasonable expectation that he or she could effectively

communicate his or her request . . . in that circumstance.” Id.

Petitioners challenge the Commission’s treatment of

revocations on various grounds, none of which we find

persuasive. Petitioners’ chief objection is that the

Commission’s approach is arbitrary and capricious in

eschewing the establishment of standardized revocation

procedures in favor of an unduly uncertain, any-reasonable-

means standard. Without the certainty of standardized

procedures, petitioners fear, they will be able to ward off

TCPA liability only by “tak[ing] exorbitant precautions.”

ACA Int’l Br. 57.

We think petitioners’ concerns are overstated. The

Commission’s ruling absolves callers of any responsibility to

adopt systems that would entail “undue burdens” or would be

“overly burdensome to implement.” 30 FCC Rcd. at 7996

¶ 64 & n.233. In light of that assurance, callers would have

no need to train every retail employee on the finer points of

42

revocation. And callers will have every incentive to avoid

TCPA liability by making available clearly-defined and easy-

to-use opt-out methods. If recipients are afforded such

options, any effort to sidestep the available methods in favor

of idiosyncratic or imaginative revocation requests might well

be seen as unreasonable. The selection of an unconventional

method of seeking revocation might also betray the absence

of any “reasonable expectation” by the consumer that she

could “effectively communicate” a revocation request in the

chosen fashion. Id.

Petitioners observe that the Commission’s ruling itself

dictates particular opt-out mechanisms for certain types of

time-sensitive banking- and healthcare-related calls that the

Commission exempted from the TCPA’s consumer consent

requirements. Id. at 8028 ¶ 138; id. at 8032 ¶ 147. If the

Commission prescribed specific opt-out methods for those

types of calls, petitioners ask, then why not similarly set out

standardized means of revocation for all calls?

The Commission was not required to treat the two

situations in a parallel manner. For the banking- and

healthcare-related calls, the Commission found that the

communications were sufficiently important to warrant an

exemption from the otherwise-applicable obligation to obtain

prior consent. Id. at 8023 ¶ 125. As a result, the default rule

for those calls is that they should be allowed (without regard

to consent), such that the availability of an opt-out can be

conditioned on adhering to specific procedures. By contrast,

the default rule for non-exempted calls is that they are

disallowed (absent consent), such that the availability of an

opt-out naturally could be broader. In that context, the

Commission could reasonably elect to enable consumers to

revoke their consent without having to adhere to specific

procedures.

43

Finally, petitioners object to the Declaratory Ruling

insofar as it might preclude callers and consumers from

contractually agreeing to revocation mechanisms. The

Commission correctly concedes, however, that the ruling “did

not address whether contracting parties can select a particular

revocation procedure by mutual agreement.” FCC Br. 64

n.16. The ruling precludes unilateral imposition of revocation

rules by callers; it does not address revocation rules mutually

adopted by contracting parties. Nothing in the Commission’s

order thus should be understood to speak to parties’ ability to

agree upon revocation procedures.

D.

The last set of challenges before us, brought by petitioner

Rite Aid, concerns the scope of the Commission’s exemption

of certain healthcare-related calls from the TCPA’s prior-

consent requirement for calls to wireless numbers. The

Commission is statutorily authorized to exempt from that

requirement “calls to a telephone number assigned to a

cellular telephone service that are not charged to the called

party, subject to such conditions as the Commission may

prescribe as necessary in the interest of the privacy rights this

section is intended to protect.” 47 U.S.C. § 227(b)(2)(C).

The Commission was petitioned to exempt from the

consent requirement “certain non-telemarketing, healthcare

calls” alleged to “provide vital, time-sensitive information

patients welcome, expect, and often rely on to make informed

decisions.” 2015 Declaratory Ruling, 30 FCC Rcd. at 8030

¶ 143. The agency acknowledged the “exigency and public

interest” in various types of healthcare-related calls, including

ones “regarding post-discharge follow-up intended to prevent

readmission, or prescription notifications.” Id. at 8031 ¶ 146.

But it was “concerned that these policy arguments are not

44

true” for other types of healthcare calls. Id. Specifically, the

Commission “fail[ed] to see the same exigency and public

interest in calls regarding account communications and

payment notifications.” Id.

Consequently, the Commission granted the requested

exemption but “restrict[ed] it to calls for which there is

exigency and that have a healthcare treatment purpose,

specifically: appointment and exam confirmations and

reminders, wellness checkups, hospital pre-registration

instructions, pre-operative instructions, lab results, post-

discharge follow-up intended to prevent readmission,

prescription notifications, and home healthcare instructions.”

Id. The exemption would not cover calls “that include

telemarketing, solicitation, or advertising content, or which

include accounting, billing, debt-collection, or other financial

content.” Id.

Petitioner Rite Aid challenges the Commission’s

exemption for select healthcare-related calls on the grounds

that it conflicts with another federal statute (the Health

Insurance Portability and Accountability Act, or HIPAA) and

is arbitrary and capricious. Rite Aid’s arguments

misunderstand the relevant statutory terrain, and we reject

them.

1.

At the outset, we must satisfy ourselves that we have

jurisdiction to entertain Rite Aid’s challenge. Rite Aid has

been styled a petitioner here, but it did not formally petition

the Commission in the proceedings before the agency. The

petition granted by the Commission in part was filed by the

American Association of Healthcare Administrative

Management (the Association). Rite Aid expressed “support”

45

for the Association’s petition for a declaratory ruling and

exemption, and it also asked the Commission to “address

certain additional issues.” Comments of Rite Aid, Joint

App’x 850. But it participated only by commenting on the

Association’s petition rather than filing one of its own. As a

result, with respect to relief that only Rite Aid sought, the

Commission “decline[d] to fully address th[at] request for

clarification . . . raised in a comment to a pending Petition.”

2015 Declaratory Ruling, 30 FCC Rcd. at 8028-29 ¶ 141

n.471. The Association did not appeal the FCC’s partial

denial of its requested exemption. Instead, Rite Aid has

petitioned the court to review that denial.

Direct review of final FCC orders is governed by the

Hobbs Act, under which “[a]ny party aggrieved by [a] final

order” of the Commission may petition for review of that

order. 28 U.S.C. § 2344. We have consistently held that the

phrase “party aggrieved” requires that petitioners have been

parties to the underlying agency proceedings, not simply

parties to the present suit who are aggrieved in a

constitutional (Article III) sense. See Simmons v. ICC, 716

F.2d 40, 42 (D.C. Cir. 1983). The question here is whether

commenting on a petition in agency proceedings that resulted

in a declaratory ruling suffices to confer “party aggrieved”

status on a litigant whose position the agency rejected.

We find it does. For agency proceedings that do not

require intervention as a prerequisite to participation, our

decisions have recognized that “party aggrieved” means a

party who has “made a full presentation of views to the

agency.” Water Transp. Ass’n v. ICC, 819 F.2d 1189, 1193

(D.C. Cir. 1987). Rite Aid fulfilled that requirement. Just as

“submitting comments” confers “party aggrieved” status in

the context of a rulemaking (assuming an adverse outcome),

Prof’l Reactor Operator Soc’y v. U.S. Nuclear Regulatory

46

Comm’n, 939 F.2d 1047, 1049 n.1 (D.C. Cir. 1991), one who

comments on another’s petition for a rulemaking or

declaratory ruling has “present[ed] its view to the agency [so

as] to qualify as a ‘party,’” S. Pac. Transp. Co. v. ICC, 69

F.3d 583, 588 (D.C. Cir. 1995)—at least insofar as the issues

appealed were also taken up by the petitioner below (as they

were here). Rite Aid afforded the Commission an opportunity

to consider its position on the Association’s exemption

request. We therefore proceed to the substance of Rite Aid’s

challenge.

2.

Rite Aid contends that, “[b]y restricting otherwise

permissible HIPAA communications,” the Declaratory Ruling

“conflicts with another federal law.” Rite Aid Br. 12 (quoting

NextWave Pers. Commc’ns, Inc. v. FCC, 254 F.3d 130, 149

(D.C. Cir. 2001)). It essentially argues that any partial

exemption of healthcare-related communications would have

been unlawful, because HIPAA—the exclusive source of

federal law on the disclosure of protected health

information—operates of its own force to supersede any

TCPA prohibition on healthcare calls. Rite-Aid is incorrect.

There is no obstacle to complying with both the TCPA and

HIPAA; “[t]he two statutes provide separate protections.”

Mais v. Gulf Coast Collection Bureau, Inc., 768 F.3d 1110,

1125 (11th Cir. 2014).

Under HIPAA regulations, covered entities and their

business associates presumptively “may not use or disclose

protected health information.” 45 C.F.R. § 164.502(a). But

they are generally permitted to use or disclose that

information “for treatment, payment, or health care

operations.” Id. § 164.506(a). Rite Aid complains that the

partial exemption granted in the Declaratory Ruling conflicts

47

with HIPAA because it stops short of exempting billing- and

account-related communications—i.e., ones “for . . .

payment.” Id. But all that § 164.506(a)’s exclusion does is to

carve out an exception to civil and criminal liability for using

or disclosing protected health information. See 42 U.S.C.

§§ 1320d-5, 1320d-6. It says nothing about the

Commission’s authority to exempt (or refrain from

exempting) certain kinds of calls from the TCPA’s consent

requirement.

In confining the use of its exemption authority, the

Commission did not restrict communications that HIPAA

requires be permitted to flow freely. It simply declined to

make certain exchanges even less burdensome than they

would have been by default. If Rite Aid were correct,

healthcare providers could use ATDS equipment to bombard

nonconsenting wireless users with calls and texts concerning

outstanding charges without incurring TCPA liability.

Nothing in HIPAA commands such a result, and we see no

basis to interpret it to frustrate the TCPA in that way.

3.

Finally, Rite Aid contends that the Declaratory Ruling’s

exemption for certain healthcare calls is arbitrary and

capricious. Neither of its suggested grounds is persuasive.

a. Rite Aid first argues that the Commission failed to

explain its purported departure from its earlier practice of

exempting HIPAA-protected communications. In addition to

its restrictions on calls to wireless numbers, the TCPA also

forbids the use of an ATDS “to initiate any telephone call to

any residential telephone line using an artificial or

prerecorded voice to deliver a message without the prior

express consent of the called party,” unless one of three

48

exceptions applies. 47 U.S.C. § 227(b)(1)(B) (emphasis

added).

In a 2012 Order, the Commission exempted from that

consent requirement “prerecorded health care-related calls to

residential lines, which are already regulated by” HIPAA. In

re Rules and Regulations Implementing the Telephone

Consumer Protection Act of 1991 (2012 Order), 27 FCC Rcd.

1830, 1837 ¶ 18 (2012). Some parts of the Order suggested

that its exemption reached no further than the one granted in

2015’s Declaratory Ruling for calls to wireless numbers.

Exempted calls were described as “promot[ing] important

communications . . . such as prescription refills and

immunization reminders,” id. at 1855 ¶ 63 n.192, and

“concern[ing] consumers’ health, not the purchase of a good

or service,” id. at 1856 ¶ 63 n.195. But the Order elsewhere

characterized its exemption as covering “all prerecorded

health care-related calls to residential lines that are subject to

HIPAA.” Id. at 1852 ¶ 57 (emphases added).

The 2012 Order’s exemption was codified in 47 C.F.R.

§ 64.1200(a)(3)(v). That regulation did not use the phrase

“health care-related call[],” but instead referred to “‘health

care’ message . . . [as] defined in the HIPAA Privacy Rule, 45

C.F.R. § 160.103.” 47 C.F.R. § 64.1200(a)(3)(v). Likewise,

§ 160.103 does not mention the term “health care message.”

But it does define “health care” as “care, services, or supplies

related to the health of an individual.” 45 C.F.R. § 160.103.

That term includes, among many other things, “[s]ale or

dispensing of a drug, device, equipment, or other item in

accordance with a prescription.” Id. A “‘health care’

message” is presumably a message pertaining to any of the

topics that “health care” is defined to include. We assume for

present purposes that some calls concerning the “[s]ale . . . of

a drug . . . in accordance with a prescription” would relate to

49

“billing,” which the 2015 Declaratory Ruling did not exempt

from the consent requirement.

Rite Aid is therefore correct that, in one sense, the 2012

exemption swept more broadly than the 2015 version. We

also accept that the 2012 Order cited a number of

“technology-agnostic justifications” for exempting all

prerecorded healthcare-related calls subject to HIPAA and

made to residential lines. Rite Aid Br. 5. For example, the

Commission believed that such calls “ensure continued

customer access to health care-related information” and

would not lead to “coercive or abusive” interactions. 2012

Order, 27 FCC Rcd. at 1853-54 ¶¶ 59-60.

The relevant question is whether the Commission acted

arbitrarily and capriciously in affording a narrower exemption

for healthcare-related calls made to wireless numbers. We

find that it did not. Even if one might hypothesize “important

reasons for treating residential and wireless telephone lines

the same,” Rite Aid Br. 9, the TCPA itself presupposes the

contrary—that calls to residential and wireless numbers

warrant differential treatment.

Unlike with the autodialer restrictions on calls to wireless

numbers, callers are free to use ATDS equipment to dial

residential lines as long as no “artificial or prerecorded voice”

is used. 47 U.S.C. § 227(b)(1)(B). The statute itself

contemplates that calls to wireless numbers “tread [more]

heavily upon . . . consumer privacy interests.” 2012 Order, 27

FCC Rcd. at 1855 ¶ 63. That concern directly informed the

2015 exemption’s scope: the Commission concluded that

messages “not critical to a called party’s healthcare . . . do not

justify setting aside a consumer’s privacy interests.” 2015

Declaratory Ruling, 30 FCC Rcd. at 8031 ¶ 146.

50

In short, there is nothing inherently contradictory about

easing restrictions on certain kinds of calls to landlines, but

not to cellular phones. And Rite Aid fails to mention another

variable that confounds direct comparisons between the two

exemptions. As codified, the 2012 exemption applies only to

calls that “us[e] an artificial or prerecorded voice to deliver a

message,” 47 C.F.R. § 64.1200(a)(3); the Declaratory

Ruling’s exemption is not so limited. We therefore reject Rite

Aid’s first arbitrary-and-capricious challenge.

b. Lastly, Rite Aid argues that the Commission acted

arbitrarily by failing to recognize that all healthcare-related

calls satisfy the TCPA’s “emergency purposes” exception to

the consent requirement. As used in the Act, “[t]he term

emergency purposes means calls made necessary in any

situation affecting the health and safety of consumers.” 47

C.F.R. § 64.1200(f)(4). But Rite Aid identifies no calls

satisfying that exception that were not already subject to the

2015 exemption. It would be implausible to conclude that

calls concerning “telemarking, solicitation, or advertising

content, or which include accounting, billing, debt-collection,

or other financial content” are made for “emergency

purposes.” 2015 Declaratory Ruling, 30 FCC Rcd. at 8031

¶ 146. Even if accounting systems are in some sense

“necessary” to the continued provision of healthcare,

“[t]imely delivery of these types of messages is not critical”

to that goal. Id. (emphasis added).

In marked contrast, the Commission recently exempted

calls concerning certain time-sensitive risks to students’

health and safety in the school setting. That list of scenarios

included “weather closures, fire, . . . threats,” “dangerous

persons, health risks (e.g., toxic spills), and unexcused

absences.” In re Rules and Regulations Implementing the

Telephone Consumer Protection Act of 1991, 31 FCC Rcd.

51

9054, 9061 ¶ 17, 9063 ¶ 21 (2016). In declining a request to

interpret the emergency-purposes exception far more

expansively, we are guided by its role in the statutory scheme.

Consumers may find themselves wholly unable to stave off

calls satisfying the exception. That is because, by definition,

such calls fall outside the TCPA’s consent framework; callers

can make them even if recipients are known to object.

Advertisements, solicitations, and post-treatment financial

communications do not arise from the sorts of “emergencies”

that would justify suspending the TCPA’s consent regime.

The Commission was empowered to draw the distinction

it did, and it adequately explained its reasons for doing so.

We therefore reject Rite Aid’s arbitrary-and-capricious

challenge.

* * * * *

For the foregoing reasons, we grant in part and deny in

part the petitions for review.

So ordered.