Amicus Curiae Brief — Facebook, Inc., Petitioner v. Noah Duguid, et al.
Supreme Court briefSep 11, 2020
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No. 19-511
IN THE
Supreme Court of the United States
FACEBOOK, INC.,
Petitioner,
v.
NOAH DUGUID, ET AL.,
Respondents.
On Writ of Certiorari
to the United States Court of Appeals
for the Ninth Circuit
BRIEF OF QUICKEN LOANS, LLC
AS AMICUS CURIAE
SUPPORTING REVERSAL
WILLIAM M. JAY
Counsel of Record
BROOKS R. BROWN
W. KYLE TAYMAN
ANDREW KIM
GOODWIN PROCTER LLP
1900 N Street, N.W.
Washington, DC 20036
WJay@goodwinlaw.com
(202) 346-4000
September 11, 2020
TABLE OF CONTENTS
PAGE
INTEREST OF THE AMICUS CURIAE.................... 1
SUMMARY OF ARGUMENT ..................................... 3
ARGUMENT ............................................................... 5
I.
An overly broad definition of “automatic
telephone dialing system” will block
legitimate outreach to consumers, while
doing little to block truly pernicious
robocalls. ........................................................... 5
A.
Congress enacted the TCPA to
combat true robocalls. ............................ 6
B.
Live calls, to a specific recipient
who was not randomly chosen,
are not robocalls. .................................... 8
C.
The TCPA is not effective in
stopping unwanted calls and is
instead being used to punish
legitimate callers.................................. 10
i
ii
II.
Even if the meaning of ATDS is limited
to its original scope, such an
interpretation will not open the
floodgates to robocalls, as other effective
measures are in place to combat them. ......... 16
III.
An overbroad construction of ATDS
risks ensnaring calls that are not just
legitimate but important, such as
Quicken Loans’ efforts to conduct
legally required outreach to individuals
in financial distress. ....................................... 23
A.
Quicken Loans uses calls and
texts to communicate with both
prospective and current clients—
but only when they have asked
Quicken Loans to do so. ....................... 23
B.
Phone communication is often the
most efficient way for Quicken
Loans to engage in outreach
required by federal law, and to
provide clients in financial
distress with immediate relief. ............ 25
D.
An overbroad ATDS definition
could allow plaintiffs to
weaponize the TCPA to hold
Quicken Loans liable for
engaging in outreach that is
beneficial to its clients. ........................ 26
CONCLUSION .......................................................... 30
iii
TABLE OF AUTHORITIES
PAGE(S)
CASES
Barr v. Am. Ass’n of Pol.
Consultants, Inc.,
140 S. Ct. 2335 (2020)
(plurality opinion) .............................................. 6, 8
Blow v. Bijora, Inc.,
855 F.3d 793 (7th Cir. 2017) .................................. 9
Connelly v. Hilton Grant
Vacations Co., LLC,
No. 12-cv-599, 2012 WL 2129364
(S.D. Cal. June 11, 2012) ..................................... 15
Newhart v. Quicken Loans Inc.,
No. 15-cv-81250, 2016 WL 7118998
(S.D. Fla. Oct. 12, 2016) ....................................... 28
Orsatti v. Quicken Loans, Inc.,
No. 15-cv-9380, 2016 WL 7650574
(C.D. Cal. Sept. 12, 2016) .................................... 27
Reese v. Marketron Broad. Sols., Inc.,
No. 18-1982, 2018 WL 2117241
(E.D. La. May 8, 2018) ......................................... 15
STATUTES
15 U.S.C. § 9056 ........................................................ 25
47 U.S.C. § 227(a)(1) ................................................... 7
iv
47 U.S.C. § 227(b)(1)(A) .......................................... 6, 7
47 U.S.C. § 227(b)(1)(A)(i) ........................................... 8
47 U.S.C. § 227(b)(1)(A)(ii) .......................................... 8
47 U.S.C. § 227(b)(1)(A)(iii) ..................................... 7, 8
47 U.S.C. § 227(b)(1)(B) .............................................. 6
47 U.S.C. § 227(b)(2)(B) ............................................ 11
47 U.S.C. § 227(b)(2)(C) ............................................ 11
47 U.S.C. § 227(c)(5) .................................................. 17
47 U.S.C. § 227(e)(5)(A)(i) ......................................... 17
Pallone-Thune Telephone Robocall
Abuse Criminal Enforcement and
Deterrence (TRACED) Act,
Pub. L. No. 116-105,
133 Stat. 3274 (2019) ........................................... 20
S.B. 514, 92nd Assemb. (Ark. 2019) ......................... 22
Consumer Call Protection Act of 2019,
Cal. Pub. Util. Code § 2893.5............................... 22
LD 277, SP 89, 129th Leg. (Me. 2019) ...................... 22
N.Y. Gen. Bus. Law § 399-z(5-a) ............................... 23
N.Y. Gen. Bus. Law § 399-z(14)(a)............................ 23
Nuisance Call Act of 2019, S.B. S4777,
2019-2020 Leg. Sess. (N.Y. 2019). ....................... 22
v
REGULATIONS AND REGULATORY MATERIALS
12 C.F.R. § 1024.39(a) ............................................... 25
16 C.F.R. § 310.4(b)(1)(iii)(B) .................................... 17
16 C.F.R. § 310.4(b)(1)(iii)(B)(ii) ............................... 23
16 C.F.R. § 310.4(b)(1)(v)(A) ..................................... 21
16 C.F.R. § 310.4(b)(1)(v)(B)(ii)(A) ............................ 21
16 C.F.R. § 310.4(b)(1)(v)(B)(ii)(B) ............................ 22
16 C.F.R. § 310.4(c) ................................................... 21
16 C.F.R. § 310.4(d) ................................................... 21
16 C.F.R. § 310.4(e) ................................................... 21
16 C.F.R. § 310.8(c) ................................................... 17
47 C.F.R. § 64.1200(a)(2) ........................................... 22
47 C.F.R. § 64.1200(a)(3)(ii) ................................ 11, 26
47 C.F.R. § 64.1200(a)(3)(iii) ..................................... 12
47 C.F.R. § 64.1200(a)(3)(iv) ..................................... 12
47 C.F.R. § 64.1200(a)(3)(v) ...................................... 12
47 C.F.R. § 64.1200(a)(7)(i)(A) .................................. 22
47 C.F.R. § 64.1200(a)(7)(i)(B) .................................. 22
47 C.F.R. § 64.1200(b)(3) ........................................... 22
vi
47 C.F.R. § 64.1200(c)(2) ........................................... 17
47 C.F.R. § 64.1200(c)(2)(i)(A) ................................... 17
47 C.F.R. § 64.1200(c)(2)(i)(B) ................................... 17
47 C.F.R. § 64.1200(c)(2)(i)(C) ................................... 17
47 C.F.R. § 64.1200(c)(2)(i)(D) .................................. 17
47 C.F.R. § 64.1200(d) ............................................... 21
Telemarketing Sales Rule,
60 Fed. Reg. 43,842 (Aug. 23, 1995) .................... 21
Telemarketing Sales Rule,
68 Fed. Reg. 4,580 (Jan. 29, 2003) ...................... 16
77 Fed. Reg. 34,233 (June 11, 2012) ......................... 21
Call Authentication Trust Anchor;
Implementation of TRACED Act—
Knowledge of Customers by Entities
With Access to Numbering Resources,
85 Fed. Reg. 22,029
(Apr. 21, 2020) ...................................................... 20
In re Advanced Methods to Target and
Eliminate Unlawful Robocalls,
No. 19-51, 2019 WL 2461905
(FCC June 7, 2019) .............................................. 20
vii
In re Call Authentication Trust Anchor
Implementation of TRACED Act
Section 6(a),
No. 20-42, 2020 WL 1634553
(FCC Mar. 31, 2020) ...................................... 19, 25
In re Rules & Regulations Implementing
the Telephone Consumer Protection
Act of 1991,
18 FCC Rcd. 14,014 (July 3, 2003) ...................... 24
In re Rules & Regulations Implementing
the Telephone Consumer Protection
Act of 1991,
30 FCC Rcd. 7961 (July 10, 2015) ................. 12, 29
In re Rules & Regulations Implementing
the Telephone Consumer Protection
Act of 1991,
7 FCC Rcd. 8752 (Oct. 16, 1992).................... 11, 13
In re Rules and Regulations
Implementing the Telephone
Consumer Protection Act of 1991
(P2P Alliance Petition for
Clarification),
DA No. 20-670, 2020 WL 3511100
(FCC June 25, 2020) ............................................ 14
LEGISLATIVE HISTORY
H.R. Rep. No. 102-317 (1991)...................................... 7
S. Rep. No. 102-178 (1991),
as reprinted in
1991 U.S.C.C.A.N. 1969........................... 6, 7, 9, 27
viii
S. Rep. No. 116-41 (2019) .......................................... 20
Stopping Fraudulent Robocall Scams:
Can More Be Done? Hrg. Before the
Subcomm. on Consumer Protection,
Product Safety, and Ins. of the
Comm. on Commerce, Science, and
Transportation, 113th Cong. (2013) .................... 18
OTHER AUTHORITIES
James F. DeRose,
The Wireless Data Handbook
(4th ed. 1999).......................................................... 8
FCC, Caller ID Spoofing,
https://www.fcc.gov/consumers/guide
s/spoofing-and-caller-id ........................................ 13
FCC, CGB –
Consumer Complaints Data,
https://opendata.fcc.gov/Consumer/
CGB-Consumer-ComplaintsData/3xyp-aqkj/data ............................................ 11
FCC, FCC – Open Data: CGB Unwanted Calls 2019YTD,
https://opendata.fcc.gov/
Consumer/CGB-Unwanted-Calls2019YTD/vzkh-ddru ............................................ 18
ix
FCC, FCC Mandates That Phone
Companies Implement Caller ID
Authentication to Combat Spoofed
Robocalls (Mar. 31, 2020),
https://docs.fcc.gov/public/attachmen
ts/DOC-363399A1.pdf .......................................... 20
FCC, Report on Robocalls: A Report of
the Consumer and Governmental
Affairs Bureau, CG Dkt. No. 17-59,
2019 WL 945132 (Feb. 1, 2019) ..................... 13, 19
FTC, Biennial Report to Congress Under
the Do-Not-Call Registry Fee
Extension Act of 2007 (Dec. 2019) ....................... 18
FTC, National Do Not Call Registry
Data Book for Fiscal Year 2019
(Oct. 2019), https://www
.ftc.gov/reports/national-do-not-callregistry-data-book-fiscal-year-2019 .................... 18
Adam Ismail, Best Basic Phone Plans:
From Low Data to Talk and Text
Only, Tom’s Guide (Apr. 9, 2020),
https://www.tomsguide.com/bestpicks/best-basic-phone-plans-lowdata-talk-text ......................................................... 8
Lily Hay Newman, The Robocall Crisis
Will Never Be Totally Fixed, Wired
Magazine (Apr. 7, 2019, 7:00 AM),
https://www.wired.com/story/robocall
s-spam-fix-stir-shaken/ ........................................ 14
x
Yuki Noguchi, ‘Do I Know You?’ And
Other Spam Phone Calls We Can’t
Get Rid Of, NPR
(June 6, 2019, 5:00 AM),
https://www.npr.org/2019/06/06//iknow-you-and-other-spam-phonecalls-we-can-t-get-rid-of ....................................... 10
Pew Research Ctr., Mobile Fact Sheet
(June 12, 2019),
https://www.pewresearch.org/
internet/fact-sheet/mobile/ ..................................... 8
Quicken Loans, Let’s Stay In Touch,
https://www.quickenloans.com/
subscribe ............................................................... 24
Quicken Loans Mortgage Assistance and
Client Resources for COVID-19,
Rocket Mortgage (May 24, 2020),
https://www.rocketmortgage.com/
learn/mortgaassistance-covid19 .......................... 26
Anthony Ramirez, Mapping the
Wireless-Phone Future, N.Y. Times
(Nov. 12, 1992),
https://www.nytimes.com/
1992/11/12/us/mapping-out-thewireless-phone-future.html ................................... 7
xi
Stuart L. Pardau, Good Intentions and
the Road to Regulatory Hell: How the
TCPA Went from Consumer
Protection Statute to Litigation
Nightmare,
2018 U. Ill. J.L. Tech. & Pol’y 313
(2018) .................................................................... 14
U.S. Chamber Institute for Legal
Reform, TCPA Litigation
Continues to Skyrocket
(Jan. 26, 2017),
https://www.instituteforlegalreform.c
om//litigation-continues-toskyrocket-1272-percent-increasesince-2010 ............................................................. 29
U.S. Chamber Institute for Legal
Reform, TCPA Litigation Sprawl: A
Study of the Sources and Targets of
Recent TCPA Lawsuits (Aug. 2017) .................... 14
INTEREST OF THE AMICUS CURIAE1
Quicken Loans is a Detroit-based mortgage
company that helps its clients achieve the American
dream of home ownership and financial freedom. It is
the nation’s largest mortgage lender and one of the
nation’s top ten mortgage servicers. Quicken Loans’
“client-first” philosophy of customer service, driven
largely by easy and efficient client engagement and
communication, is the reason why Quicken Loans is
the industry leader in client satisfaction. J.D. Power
and Associates has named Quicken Loans the top
mortgage originator for customer service for the last
ten years, and the top mortgage servicer for the last
seven.
Much of Quicken Loans’ award-winning client
engagement is done over the telephone—either with a
call or a text. Quicken Loans does not blindly “cold
call”; it communicates with prospective clients only
when they have asked for information about Quicken
Loans’ products, and it proactively contacts current
clients to offer services that might benefit them, such
as forbearance, payment deferrals, and other options to
help clients stay in their homes in the wake of the
COVID-19 crisis.
That outreach has come at an unanticipated cost.
In the last two years alone, Quicken Loans has been
forced to defend against numerous putative class
action lawsuits alleging that its telephone
1 All parties have consented to the filing of this brief. No counsel
for a party authored any part of this brief, and no such counsel or
party made a monetary contribution intended to fund the
preparation or submission of this brief. No person other than
amicus curiae or its counsel made a monetary contribution to the
brief’s preparation or submission.
1
2
communications (both calls and text messages) violate
the so-called “autodialer provision” of the Telephone
Consumer Protection Act of 1991 (“TCPA”), 47 U.S.C.
§ 227. These lawsuits (and numerous other individual
TCPA lawsuits) have been brought by plaintiffs looking
to turn Quicken Loans’ beneficial, client-focused
outreach into a personal windfall in the form of
statutory damages.
These lawsuits have been made possible by an
overreaching and untenable interpretation of the
TCPA’s definition of the term “automatic telephone
dialing system” (“ATDS”). Instead of limiting the term
to equipment that randomly or sequentially dials
phone numbers—as the statute plainly requires—
several courts, including the Ninth Circuit, have
concluded that the TCPA applies when calls are made
using equipment that stores numbers and dials those
stored numbers automatically—i.e., that can
automatically dial numbers from a list. This farreaching
interpretation,
which
would
treat
smartphones used by Americans everyday as an ATDS,
see Br. for Pet’r 44, allows plaintiffs to weaponize the
TCPA and sue companies like Quicken Loans over calls
requested by consumers and legitimate calls to specific
groups of individuals made for valid business purposes.
This runs contrary to Congress’s intent to have the
TCPA serve as a shield against true, unsolicited
nuisance calls—i.e., automated robocalls and
telemarketing calls that are blindly made and
indiscriminately blanketed across the country.
As a frequent target of these abusive TCPA
lawsuits, Quicken Loans has an interest in the
question presented and in ensuring that the ATDS
definition in the TCPA is given its original scope.
Expanding the ATDS definition beyond what Congress
3
wrote has done little to stop the explosive growth of the
calls that Congress intended to prohibit in enacting the
TCPA in 1991. Indeed, other regulatory frameworks
have proven to be far more effective in stopping
unwanted calls. In Quicken Loans’ experience, the
contorted interpretation of the ATDS definition
adopted by the court of appeals here has only harmed
companies and the clients that they serve.
SUMMARY OF ARGUMENT
I. Everyone agrees that true robocalls are a
nuisance. Most people with a phone are tired of
receiving unsolicited marketing calls from a
prerecorded or artificial voice, or randomly dialed calls,
even if made by a live operator. But the fact that these
calls are still a nuisance demonstrates that the TCPA
is not particularly effective in stopping them, despite
being designed for that very purpose. Even with an
overly expansive ATDS definition, truly pernicious
robocalls continue to bother owners of residential
landlines and mobile phones alike. The people who
make them are not afraid of the TCPA’s penalties,
because they are not afraid of being identified and sued
in a U.S. court. The calls they make are “spoofed”—
disguised to hide their origin and caller—so a weary
recipient will not know whom to sue.
Instead of stopping unsolicited robocalls and
uninvited telemarketing calls to random consumers,
the widening of the TCPA’s net has improperly
snagged more and more legitimate calls and messages.
Companies like Quicken Loans are being subjected to
class actions, and the attendant pressure to settle or
face uncertain liability for engaging in legitimate
consumer outreach, even though the outreach is often
done at the consumer’s behest or to the consumer’s
4
benefit. According to respondents and the court of
appeals here, a caller cannot store numbers on a list
and dial from the list “automatically” unless the caller
has prior express consent for the call from each
recipient. That interpretation punishes companies for
using technology to efficiently place their legitimate,
personalized calls, without random or sequential
dialing—instead of dialing the phone manually. And
while legitimate calls are being ensnared in the
TCPA’s widened web, the number of true robocalls is
growing unabated—either because such calls are
expressly allowed by the FCC, or because technology
has made it possible for robocallers to evade detection.
II. Limiting the meaning of ATDS to the types of
calls that Congress intended—calls that are randomly
or sequentially made—will not open the proverbial
floodgates and expose Americans to even more
nuisance calls. To the contrary, there are a number of
effective tools already in place to fight unwanted calls,
including the Federal Do-Not-Call Registry, the
Federal Trade Commission (FTC)’s Telemarketing
Sales Rule, and SHAKEN/STIR, the FCC’s new
preferred framework for stopping robocalls at the
carrier level, before they reach their intended
recipients.
III.The court of appeals’ sweeping ATDS
interpretation will only discourage companies like
Quicken Loans from maintaining contact with their
clients and offering them assistance when appropriate.
That discouragement is especially problematic when
the contact and engagement is required by federal law.
For example, as a mortgage servicer, Quicken Loans is
required to establish “live contact” after learning that a
client is unable to make his or her payments, and to
“promptly” provide the client with information about
5
the client’s options for avoiding foreclosure and saving
his or her home. The court of appeals’ ATDS
interpretation would allow plaintiffs to use one
consumer-protection statute (the TCPA) to hold
Quicken Loans liable for complying with another
consumer-protection statute, and for delivering relief to
clients in financial distress.
ARGUMENT
I. An overly broad definition of “automatic
telephone dialing system” will block legitimate outreach to consumers, while doing
little to block truly pernicious robocalls.
A cordless landline and a cellphone both ring. The
first is a randomly dialed call, using a prerecorded
voice, with an unwanted political message. The second
is a personal communication to let the recipient know
that she has missed a mortgage payment. It should be
obvious which of these two calls falls under a statute
written to restrict automatic telephone dialing—i.e.,
robocalls. But the first call is exempt. And the court
below would find the second call in violation of the
statute, and subject to civil penalties of $500 to $1,500,
if the caller from the mortgage company automatically
dials the number from a stored list of phone numbers
without the borrower’s consent—say, all clients who
have missed a payment that month and need follow-up.
In other words, under the Ninth Circuit’s interpretation, many personal communications are punished as
robocalls—whereas many actual robocalls are exempt.
That topsy-turvy result helps illustrate why the Ninth
Circuit’s interpretation is simply wrong.
Under that interpretation, the TCPA no longer
combats robocalls: it extends to calls and texts that are
6
not made through either “random” or “sequential” dialing (and that do not involve any artificial or prerecorded voice). That misreading of the statutory term “automatic telephone dialing system” ensnares calls made
by live humans, to particular consumers, for legitimate
business purposes. And all the while, true “robocalls”
either evade detection or, in some cases, have even
been legitimized by the FCC through the use of its exemption authority.
A. Congress enacted the TCPA to combat
true robocalls.
Congress enacted the TCPA in 1991 to respond to “a
torrent of vociferous consumer complaints about robocalls,” Barr v. Am. Ass’n of Pol. Consultants, Inc.
(AAPC), 140 S. Ct. 2335, 2344 (2020) (plurality opinion). The problems with robocalls, as opposed to telephone solicitation more generally, fell mainly into two
categories.
First, robocalls containing prerecorded messages
were tying up phone lines of all kinds—phones used by
emergency personnel, business lines, and residential
lines. These messages were filling up answering machines and sometimes preventing callers from placing
calls, as the calls delivering the prerecorded messages
would not properly disconnect. See S. Rep. No. 102178, at 2, 4-5 n.5 (1991), as reprinted in 1991
U.S.C.C.A.N. 1969, 1971-72. The TCPA accordingly
restricts the use of “an artificial or prerecorded voice”
to call certain residential or cell phones, among other
recipients. 47 U.S.C. § 227(b)(1)(A), (B).
Second, some indiscriminate calls cost the unwilling
recipient money or tied up resources. Calls made to
“cellular or paging telephone numbers” “impose[d] a
7
cost on the called party.” S. Rep. No. 102-178, at 2, as
reprinted in 1991 U.S.C.C.A.N. 1969. In the early
1990s, cell phone calls could cost up to 90 cents per minute (regardless of whether the cell phone user was the
caller or the recipient)—up to 80 times the cost of a local call. See Anthony Ramirez, Mapping the WirelessPhone Future, N.Y. Times (Nov. 12, 1992),
https://www.nytimes.com/1992/11/12/us/mapping-outthe-wireless-phone-future.html. Auto-dialing randomly or sequentially, especially in large numbers, thus
could result in calls—and charges—to many of these
unsuspecting consumers, even if the caller used a live
person rather than a recorded message. In addition,
auto-dialing randomly or sequentially often resulted in
calls to “emergency and public service organizations,”
which had to commit their limited resources to answering them. H.R. Rep. No. 102-317, at 10, 24 (1991).
These autodialed calls are robocalls not because they
use a robotic voice, but because they use robotic random or sequential number dialing to make indiscriminate “cold calls.”
To combat that problem, Congress adopted the
ATDS provision at issue in this case. The ATDS provision of the TCPA prohibits calls from being made “using any automatic telephone dialing system” to certain
recipients. 47 U.S.C. § 227(b)(1)(A)(iii).2 An “automatic telephone dialing system” (ATDS) is “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). The list of prohibited recipients in2 There are exceptions for emergencies and calls made with prior
express consent. 47 U.S.C. § 227(b)(1)(A).
8
cludes cell phones, as well as hospital rooms, police
emergency numbers, and others that a telemarketer,
for example, would be unlikely to call on purpose but
might call through random or sequential dialing. See
id. § 227(b)(1)(A)(i)-(iii).
Thus, “[i]n plain English, the TCPA prohibited almost all robocalls to cell phones.” AAPC, 140 S. Ct. at
2344. At the time, that was a much smaller-scale prohibition than the restriction on calls using pre-recorded
messages and artificial voices: unlike today, cell
phones in the early 1990s were a rarity. As of June
1992, there were only 8,892,535 cell phone subscribers
in the United States, roughly 3% of the American population. James F. DeRose, The Wireless Data Handbook
132 (4th ed. 1999). Now, 96% of Americans have a cell
phone of some kind. Pew Research Ctr., Mobile Fact
Sheet, (June 12, 2019), https://www.pewresearch.org/
internet/fact-sheet/mobile/. And under most calling
plans, an incoming call will rarely or never increase the
recipient’s bill, as these plans allow for unlimited calls
and texts at a flat rate. See Adam Ismail, Best Basic
Phone Plans: From Low Data to Talk and Text Only,
Tom’s Guide (Apr. 9, 2020), https://www.tomsguide
.com/best-picks/best-basic-phone-plans-low-data-talktext (identifying a number of low-cost cell phone plans
with unlimited talk and text options).
B. Live calls, to a specific recipient who was
not randomly chosen, are not robocalls.
There is a marked difference between a robocall and
a live call directed at a consumer that is made from a
list. Legitimate calls are targeted, whereas the robocalls addressed by the TCPA are often indiscriminately made. A telemarketer looking to blanket the
9
country with its product or service, or a fraudster trying to obtain iCloud passwords through a fake security
message, are perfectly happy to make calls at random,
or by sequentially dialing a series of numbers (e.g.,
202-555-1000, 202-555-1001, and so on). Indeed, as the
Senate Report on the TCPA recognized, random or sequential dialing is attractive to telemarketers precisely
because it allows the caller to reach even unlisted
numbers. S. Rep. No. 102-178, at 2.
But TCPA plaintiffs, not content to pursue true robocallers, have attempted to portray the TCPA as if it
penalized any call that the recipient might find unwelcome. That attempt to reinterpret the statute depends
on reading the definition of ATDS as broadly as possible. They contend that any technology that makes
phone calls from a stored list somehow automatically
transforms the calls into robocalls prohibited by the
TCPA.
But a list of phone numbers is not something only
telemarketers use; it is an age-old technique used by
everyone from neighborhood phone trees to charities
that thank their donors—anyone, in short, who needs
to contact two or more specific people (unlike an indiscriminate robocaller). Legitimate companies often use
lists to reach out to a particular group of individuals
for a specific purpose. See pp. 23-26, infra. These
numbers are not generated at random or in sequential
order and dialed; rather, they are gathered deliberately, often because the call recipients themselves have
provided their numbers in order to receive communications from that caller. See, e.g., Blow v. Bijora, Inc.,
855 F.3d 793, 803 (7th Cir. 2017) (TCPA plaintiff “gave
her cell phone number to [the caller] on several differ-
10
ent occasions,” which was then added to a text messaging list).
In short, dialing from a list is not robocalling—it is
a common practice that virtually anyone can use for
efficient outreach. There is nothing “robo” about it.
C. The TCPA is not effective in stopping
unwanted calls and is instead being used
to punish legitimate callers.
Even as plaintiffs have been pushing to expand the
ATDS definition to treat more calls as robocalls and,
supposedly, deter more robocalling, the end result has
been exactly the opposite: there has only been a dramatic increase in unwanted calls. That, in turn, has
caused most Americans to avoid answering the phone.
See Yuki Noguchi, ‘Do I Know You?’ And Other Spam
Phone Calls We Can’t Get Rid Of, NPR (June 6, 2019,
5:00 AM), https://www.npr.org/2019/06/06/727711432/
do-i-know-you-and-other-spam-phone-calls-we-can-tget-rid-of (noting that “70% of [Americans] no longer
answer calls they don’t recognize,” and that, while
“[r]egulators and industry are combating junk calls
. . . . so far, they haven’t succeeded”).
There are two reasons for the explosive uptick in
unwanted calls (despite the fact that in parts of the
country the ATDS net has been cast more widely than
the statute should allow). First, many types of calls
that most Americans would consider “unwanted” are
expressly permitted by the FCC. So even the broadest
possible interpretation of ATDS would not stop those
calls. Second, robocallers have become far cleverer and
harder to detect than in 1991, when Congress enacted
the TCPA.
11
1. Congress left it to the FCC to decide which unwanted calls subject to the TCPA should nevertheless
be permitted even without prior express consent and
even if made with an ATDS. 47 U.S.C. § 227(b)(2)(B),
(C). And the FCC has used that power to carve out
sweeping categories of “unwanted” calls.
The FCC expressly allows a number of “robocalls”—
specifically, calls made “using an artificial or prerecorded voice to deliver a message”—to residential landlines. These are the robocalls that most Americans
find to be a nuisance.3 Any such robocall “not made for
a commercial purpose,” for example, is allowed. 47
C.F.R. § 64.1200(a)(3)(ii). So if a resident receives a
prerecorded call on her home phone line asking her to
participate in a market survey or a presidential poll,
that is not considered a prohibited “robocall” under the
TCPA, even if a sophisticated computer interface is
asking questions on the other end of the line. See In re
Rules & Regulations Implementing the Telephone Consumer Protection Act of 1991, 7 FCC Rcd. 8752, 8774
(Oct. 16, 1992) (“1992 Order”) (explaining that the exemption for non-commercial calls extends to “calls conducting research, market surveys, political polling or
similar activities”). Robocalls “made by or on behalf of
a tax-exempt nonprofit organization,” as well as certain
3 Of the 726,306 unwanted-call complaints that the FCC received
since October 31, 2014, 265,238 (36.5%) were about prerecorded
messages. By contrast, only 172,844 (23.8%) were about live calls.
The remainder of the complaints were either about abandoned
calls (135,504, or 18.7%), or text messages (31,031, or 4.3%), or did
not identify a reason for the complaint (121,689, or 16.7%). See
FCC, CGB – Consumer Complaints Data (accessed on Aug. 30,
2020), https://opendata.fcc.gov/Consumer/CGB-Consumer-Compla
ints-Data/3xyp-aqkj/data.
12
healthcare-related robocalls, are also exempt. 47
C.F.R. § 64.1200(a)(3)(iv), (v). Even commercial robocalls (such as a market survey on a homeowner’s future interest in solar panels) are allowed, so long as
they do not “include or introduce an advertisement or
constitute telemarketing.” Id. § 64.1200(a)(3)(iii).
Certain types of unsolicited calls to cell phones are
also allowed. The 2015 Order, for example, exempts
certain time-sensitive calls from financial institutions—e.g., to notify a customer of a potentially fraudulent transaction, to alert a customer of identity theft or
a data breach, or to confirm a money transfer. In re
Rules & Regulations Implementing the Telephone Consumer Protection Act of 1991, 30 FCC Rcd. 7961, 802426 (July 10, 2015) (“2015 Order”). Some healthcare
calls are also exempted, so long as they are not made
for marketing purposes—for example, calls about payment options, insurance coverage, and eligibility for
government benefits. Id. at 8030.
Because of these exceptions, the TCPA is a sieve
for unwanted calls, not a shield: even with the ATDS
definition at its broadest and most untenable, there are
still a host of potentially unwanted or unsolicited calls
that the TCPA will not block. A person could start his
day by getting a call on his home number asking if he’d
like to participate in a poll on the local congressional
race. Later in the day, he could get an automated call
from his doctor’s office on his cell phone, reminding
him of dietary restrictions in advance of his upcoming
elective procedure. And in the evening, the individual’s bank may call him on his cell phone to let him
know that, due to a recent data breach, he is eligible to
sign up for a credit monitoring service. The TCPA
would not stop any of these calls. See 2015 Order, 30
13
FCC Rcd. at 8025, 8030; 1992 Order, 7 FCC Rcd. at
8774. But if the person’s mortgage servicer uses certain calling technology to place a live call to the person’s cell phone so as to alert him about his eligibility
for COVID-19 relief options, the Ninth Circuit’s ATDS
interpretation would make that call unlawful unless
the servicer can show that it had prior express consent
to place the call.
2. Expanding the definition of the type of equipment used to make phone calls will do little to address
the reason why pernicious robocalls have become increasingly pervasive and increasingly difficult to stop:
technology. The data proves this—the number of robocalls made in the United States has grown exponentially in the last five years, despite efforts by plaintiffs
to persuade courts to broaden the ATDS definition. In
2016, approximately 29 billion robocalls were made in
the United States; in 2018, that number skyrocketed to
47.8 billion. See FCC, Report on Robocalls: A Report of
the Consumer and Governmental Affairs Bureau, CG
Dkt. No. 17-59, 2019 WL 945132, at *4 (Feb. 1, 2019)
(“Report on Robocalls”).
The worst kinds of robocallers—such as those looking to scam individuals out of money or personal identifying information—manage to evade detection because their calls are “spoofed,” i.e., the name and number listed on the Caller ID display are falsified to make
the recipient think that the call is coming from a legitimate source, and because they do not reveal their true
identity during the call. The spoofing makes it difficult
to track the original caller. FCC, Caller ID Spoofing,
https://www.fcc.gov/consumers/guides/spoofing-andcaller-id. The same is true of Voice over Internet Protocol (VoIP) technology, which allows calls to be inex-
14
pensively made using the Internet. VoIP allows robocallers to hide the point of origin of a call by bouncing calls “around the telephony network a few times
before connecting,” which makes robocalls difficult to
trace. See Lily Hay Newman, The Robocall Crisis Will
Never Be Totally Fixed, Wired Magazine (Apr. 7, 2019,
7:00 AM), https://www.wired.com/story/robocalls-spamfix-stir-shaken/.
Both Congress and the FCC have recently recognized that the only way to stop these robocalls is to use
technology to thwart them before they make it to their
recipients. See pp. 18-21, infra. And as the agency itself has acknowledged, the blunt, outdated instrument
of the TCPA cannot be continually reimagined to
thwart new, smarter approaches to old nuisances. See
In re Rules and Regulations Implementing the Telephone Consumer Protection Act of 1991 (P2P Alliance
Petition for Clarification), DA No. 20-670, 2020 WL
3511100, at *4 (FCC June 25, 2020) (“The TCPA does
not and was not intended to stop every type of call.”).
3. Rather than stopping robocall-induced “telephone terrorism,” as Congress intended, the TCPA has
instead been used as a tool for class-action plaintiffs to
“hold legitimate, well-intentioned businesses hostage
with the ever-present threat of litigation.” Stuart L.
Pardau, Good Intentions and the Road to Regulatory
Hell: How the TCPA Went from Consumer Protection
Statute to Litigation Nightmare, 2018 U. Ill. J.L. Tech.
& Pol’y 313, 323 (2018). As Quicken Loans has experienced firsthand, see pp. 27-29, infra, legitimate, targeted attempts at personal consumer outreach can become
the subject of a multimillion-dollar class action. U.S.
Chamber Institute for Legal Reform, TCPA Litigation
Sprawl: A Study of the Sources and Targets of Recent
15
TCPA Lawsuits 10 (Aug. 2017) (listing TCPA class action settlements by companies between 2014 and 2017,
and identifying 21 settlements of $10 million or more).
A company that does everything the right way—for
example, by obtaining and documenting prior express
consent before making a call—is still exposed to abusive TCPA lawsuits. Plaintiffs often are not deterred
from suing even though the evidence will show that
they consented to a call. Because consent is a factintensive affirmative defense, it is rarely resolved at
the motion-to-dismiss stage. See Reese v. Marketron
Broad. Sols., Inc., No. 18-1982, 2018 WL 2117241, at
*2 (E.D. La. May 8, 2018) (“In a TCPA case, consent is
an affirmative defense.”); Connelly v. Hilton Grant Vacations Co., LLC, No. 12-cv-599, 2012 WL 2129364, at
*3 (S.D. Cal. June 11, 2012) (“Plaintiffs’ complaint need
not allege the absence of consent, and accordingly, a
motion for summary judgment—rather than a motion
to dismiss—is the proper place for the defendant to establish that the Plaintiff’s claim fails due to the presence of prior express consent.” (citation, internal quotation marks, and modifications omitted)). Plaintiffs can
drag out a TCPA lawsuit through burdensome discovery, class certification, and summary judgment—and
use the threat of lengthy litigation as leverage to extract an undeserved settlement.
As a result, not only has the TCPA been ineffective
as a shield against abusive robocalls, it is being used as
a weapon by class-action lawyers pursuing statutory
damages. And an overly expansive interpretation of
ATDS like the Ninth Circuit’s only enables such abusive litigation.
16
II. Even if the meaning of ATDS is limited to its
original scope, such an interpretation will
not open the floodgates to robocalls, as other effective measures are in place to combat
them.
Even if the ATDS provision were construed to cover
only equipment that dials calls randomly and sequentially, that construction would not mean robocalls and
unwanted solicitations would freely flow across the
country. The TCPA is far from the only tool available
to stop the scourge of unwanted calls. Regulators and
members of the public alike can turn to other existing
frameworks governing robocalls and telephone solicitations to stop unwanted calls. In many cases, these
frameworks are more effective than the TCPA.
The Federal Do-Not-Call Registry. One of the
most formidable defenses to unwanted calls is the Federal Do-Not-Call Registry maintained by the FTC. Before the Registry’s creation in 2003, the FTC required
companies to maintain their own do-not-call lists, and
several states had their own lists as well. That patchwork proved to be ineffective, as it placed the burden
on consumers to opt out of multiple companies’ lists,
and, as the calls were unsolicited, it was difficult to
know which companies would be doing the calling. See
Telemarketing Sales Rule, 68 Fed. Reg. 4,580, 4,638
(Jan. 29, 2003).
The Federal Do-Not-Call Registry supplemented
company-specific do-not-call lists with a universal one.
Consumers register their residential or personal cellular phone numbers onto the master federal list, and no
uninvited solicitation calls may be made to the listed
numbers unless there is an “established business rela-
17
tionship” between the caller and the recipient, or if the
call recipient has given consent for the call. See 16
C.F.R. § 310.4(b)(1)(iii)(B); 47 C.F.R. § 64.1200(c)(2).
Those who make solicitation calls have a number of
responsibilities under the Do-Not-Call Registry’s regulatory scheme. First, solicitors must “scrub” their
marketing lists every 31 days to ensure that all numbers on the Do-Not-Call Registry have been removed.
47 C.F.R. § 64.1200(c)(2)(i)(D). Second, in order to
know which numbers to scrub, solicitors must pay for
access to the list, at a cost of $65 per area code (and a
maximum of $17,765). 16 C.F.R. § 310.8(c). Those fees
pay for the upkeep of the Registry.
Calling a number properly registered on the DoNot-Call Registry without express consent or an established business relationship results in steep penalties
for a caller—up to $40,000 per call in a government enforcement action and $500 to $1,500 per call in a private lawsuit. See 47 U.S.C. §§ 227(c)(5), (e)(5)(A)(i).
But the Do-Not-Call regulations also encourage companies to comply by providing a safe harbor for callers
who take certain precautions to avoid calling numbers
on the list. A caller “will not be liable” for a call made
to a listed number if it:
(A) implements procedures for carrying
out the Do-Not-Call requirements;
(B) trains its staff on how to comply with
the Do-Not-Call regulations; and
(C) keeps a list of customers who asked
not to be contacted in the future.
47 C.F.R. § 64.1200(c)(2)(i)(A)-(C).
18
The Do-Not-Call Registry has been “highly effective
in reducing unwanted calls.” Stopping Fraudulent Robocall Scams: Can More Be Done? Hrg. Before the
Subcomm. on Consumer Protection, Product Safety,
and Ins. of the Comm. on Commerce, Science, and
Transportation, 113th Cong. 5 (2013) (statement of
Lois Greisman, Assoc. Dir., Bureau of Consumer Prot.,
FTC). If a cellphone user wants to avoid unwanted telemarketing solicitations, an overbroad ATDS definition
is unlikely to provide her with the deterrence she
seeks, but nor will a narrow interpretation leave her
unprotected; rather, the TCPA (intentionally) offers
her protection through the Do-Not-Call Registry.
Many Americans have availed themselves of this protection: there are 239 million numbers on the list as of
2019. FTC, Biennial Report to Congress Under the DoNot-Call Registry Fee Extension Act of 2007, at 1 (Dec.
2019). Millions of numbers are added to the list every
year. Id. And the public has been vigilant about reporting violations of the Do-Not-Call Registry—in
2019, the FTC received 5,422,298 complaints about
calls made to listed numbers, more than 25 times as
many as the 193,170 complaints that the FCC received
in the same time period about unwanted calls. Compare FTC, National Do Not Call Registry Data Book for
Fiscal Year 2019 (Oct. 2019), https://www
.ftc.gov/reports/national-do-not-call-registry-data-bookfiscal-year-2019, with FCC, FCC – Open Data: CGB Unwanted Calls 2019YTD, https://opendata.fcc.gov/
Consumer/CGB-Unwanted-Calls-2019YTD/vzkh-ddru
(last visited Sept. 4, 2020).
SHAKEN/STIR. In recent years, Congress and the
FCC have recognized that the best way to fight robocalls is not to continue adjusting the antiquated net
19
of the TCPA, but rather by new technological means
adopted for 2020 (as opposed to 1991) technology. See
Report on Robocalls, 2019 WL 945132, at *3 (noting
that robocallers are “[u]nlike legitimate callers that
wish to adhere to the TCPA” and “may not be deterred
by the prospect of enforcement,” and thus, “part of the
[FCC’s] recent work has focused on stopping robocalls
before they reach consumers’ phones”).
SHAKEN/STIR is the ambitious acronym4 for a
technological solution licensed to kill spoofed calls, i.e.,
those calls that display a false name or number to appear legitimate to the call recipient. SHAKEN/STIR is
an authentication framework, relying on an exchange
of encrypted information. In re Call Authentication
Trust Anchor Implementation of TRACED Act Section
6(a), No. 20-42, 2020 WL 1634553, at *3 (FCC Mar. 31,
2020). The originating carrier (the service provider for
the caller) provides information about the identity of
the caller, the phone number from which they are calling, or both. Id. at *4. The call and corresponding information pass through intermediate service providers,
which authenticate the identity of the caller, and confirm the authentication to the service provider for the
call recipient. Id. at *12. The originating carrier also
provides a statement of attestation, i.e., a statement
about how confident the carrier is about the identity of
the caller. Full attestation means that the call is coming from the person listed in the identifying headers,
and the person is authorized to use that number. Partial attestation means that the network can confirm
who is making the call, but not whether the caller is
44 The full name is Signature-based Handling of Asserted information using toKENS/Secure Telephony Identity Revisited.
20
authorized to use the number. And gateway attestation, the lowest form of attestation, is merely confirmation that a call has been placed on the network, but the
carrier cannot confirm anything else about the caller.
See Call Authentication Trust Anchor; Implementation
of TRACED Act—Knowledge of Customers by Entities
With Access to Numbering Resources, 85 Fed. Reg.
22,029, 22,030-31 (Apr. 21, 2020) (describing the various levels of attestation). If the originating carrier
does not provide the right level of attestation, the receiving carrier may drop the call.
Congress believed that SHAKEN/STIR would
“help[] to reduce illegal and unwanted robocalls,” S.
Rep. No. 116-41, at 1 (2019), so it recently enacted the
Pallone-Thune Telephone Robocall Abuse Criminal Enforcement and Deterrence (TRACED) Act, Pub. L. No.
116-105, 133 Stat. 3274 (2019). Under the TRACED
Act, FCC is required to implement SHAKEN/STIR
frameworks for all carriers capable of implementing it,
i.e., all VoIP networks, and create an analogous
framework for older networks that do not use VoIP.
The FCC believes SHAKEN/STIR will be an effective tool for combatting robocalls. In re Advanced
Methods to Target and Eliminate Unlawful Robocalls,
No. 19-51, 2019 WL 2461905, at *19 (FCC June 7,
2019) (“Implementation of the SHAKEN/STIR framework across voice networks is important in the fight
against unwanted, including illegal, robocalls.”). The
FCC estimates SHAKEN/STIR will play an important
role in helping consumers achieve a cost savings of up
to $3 billion per year. See FCC, FCC Mandates That
Phone Companies Implement Caller ID Authentication
to Combat Spoofed Robocalls (Mar. 31, 2020),
https://docs.fcc.gov/public/attachments/DOC-363399A1
21
.pdf (“[T]he benefits of eliminating the wasted time and
nuisance caused by illegal scam robocalls will exceed
$3 billion annually, and STIR/SHAKEN is an important part of realizing those cost savings”).
The FTC Telemarketing Sales Rule. In addition
to the Do-Not-Call Registry, the FTC also has in its robocall-fighting arsenal the Telemarketing Sales Rule
(“TSR”). Promulgated in 1995 to implement the Telemarketing Act of 1994, the TSR in its original form set
forth certain ground rules for businesses to follow in
making unsolicited marketing calls to consumers. In
particular, the TSR originally required: (1) mandatory
disclosures made at the outset of a call, including the
identity of the caller and the purpose of the call; (2)
company-specific opt-out lists; and (3) time-of-day restrictions for the placement of calls. See 16 C.F.R.
§§ 310.4(b)(v)(B)(ii)(A), (c)-(e); see also Telemarketing
Sales Rule, 60 Fed. Reg. 43,842, 43,855-56 (Aug. 23,
1995). While the TSR initially applied to only those
entities regulated by the FTC, the FCC has adopted
regulations in parallel that extend many of the TSR’s
provisions to callers outside the FTC’s reach. See 47
C.F.R. § 64.1200(d); 77 Fed. Reg. 34,233, 34,242 (June
11, 2012) (harmonizing the FCC’s rules with the FTC’s
TSR).
The FTC expanded the TSR in 2008 to cover certain
robocalls containing prerecorded messages or using an
automated-voice. Among other things, the call recipient must provide express written consent to receiving
such calls. 16 C.F.R. § 310.4(b)(1)(v)(A). The caller
must also provide recipients with the ability to use an
automated function to be removed from the caller’s list.
Id. § 310.4(b)(1)(v)(B)(ii)(A). If the call reaches an answering machine or voicemail, the message must pro-
22
vide the call recipient with a telephone number to call
to opt out of future calls. Id. § 310.4(b)(1)(v)(B)(ii)(B).
These provisions mirror those in the TCPA’s implementing regulations. 47 C.F.R. § 64.1200(a)(2) (exempting calls “made with the prior express written
consent of the called party”); id. §§ 64.1200(a)(7)(i)(A)(B), 64.1200(b)(3) (providing opt-out provisions similar
to those found in the TSR).
State-Level Safeguards. State governments have
taken additional measures to combat robocalls and
unwanted solicitations. Some states, recognizing that
spoofing is the “gateway for illegal robocalls,” have enacted anti-spoofing laws, which either criminalize
spoofing or treat it as an unfair trade practice. See,
e.g., S.B. 514, 92nd Assemb. (Ark. 2019) (making it unlawful to “display[] or caus[e] to be displayed a fictitious or misleading name or telephone number on an
Arkansas resident’s telephone caller identification service); LD 277, SP 89, 129th Leg. (Me. 2019) (making it
an “unfair trade practice” to “to transmit misleading or
inaccurate caller identification information with the
intent to defraud or cause harm to another person or to
wrongfully obtain anything of value”). Others, like
California, have implemented their own SHAKEN/STIR requirements to combat spoofing. Consumer
Call Protection Act of 2019, Cal. Pub. Util. Code
§ 2893.5.
New York recently took a different tack—instead of
targeting spoofing, it made its telemarketing provisions more robust. The Nuisance Call Act of 2019 provides an array of added protections for New York residents. S.B. S4777, 2019-2020 Leg. Sess. (N.Y. 2019).
A caller making a live telemarketing call must inform
the call recipient that the recipient may ask to be add-
23
ed to the caller’s do-not-call list.5 If the recipient asks
to be added to the list, the call must end immediately.
New York also banned any telemarketing calls (live,
prerecorded, manually dialed, or ATDS-initiated) made
without consent or an existing business relationship
during a state of emergency, such as the current
COVID-19 crisis. N.Y. Gen. Bus. Law § 399-z(5-a). Violating these new restrictions comes at a heavy cost—
state law allows for an administrative penalty of up to
$11,000 per violation. Id. § 399-z(14)(a).
III. An overbroad construction of ATDS risks
ensnaring calls that are not just legitimate
but important, such as Quicken Loans’ efforts to conduct legally required outreach to
individuals in financial distress.
A. Quicken Loans uses calls and texts to
communicate with both prospective and
current clients—but only when they have
asked Quicken Loans to do so.
Quicken Loans prides itself on being able to serve
clients seamlessly, and to communicate with them
quickly and efficiently when a need to do so arises. For
example, every client that contacts Quicken Loans
usually will receive a call back within 24 hours. While
Quicken Loans interacts with many clients through its
digital Rocket Mortgage platform, there are instances
where a call or a text is the most effective way of communicating with a client.
Quicken Loans does not engage in cold-calling or
random telephone solicitation to potential clients. Cli5 The FTC’s TSR only requires an opt-out disclosure for robocalls.
See 16 C.F.R. § 310.4(b)(1)(iii)(B)(ii).
24
ents are only contacted if they have expressed an interest in Quicken Loans’ products or services. That, of
course, makes sense because mortgages are simply unsuitable for cold telemarketing because individuals do
not shop for them on a regular basis or obtain them on
a whim. See In re Rules & Regulations Implementing
the Telephone Consumer Protection Act of 1991, 18 FCC
Rcd. 14,014, 14,155 (July 3, 2003) (statement from the
Mortgage Bankers Association that “many small lenders use referrals from existing customers, not large
lists, to attract new business”).
A prospective client may receive a call or text from
Quicken Loans after providing his or her information—
for example, by signing up for daily rate updates or information about special promotions.6 Once the prospective client begins the process of applying for a
mortgage loan, Quicken Loans may call or text the client to obtain a missing document, additional financial
information, or anything else that may be necessary to
complete the mortgage loan (or refinance) application
and close on a home. Telephone communication is the
most speedy and effective means of communicating
with a client to ensure that the application process
does not stall.
After a client obtains a loan, Quicken Loans remains in consistent communication with the client for
the life of the loan. Most communication may take
place online or by mail. But sometimes a call or a text
may be the most appropriate way to contact a client, so
that a problem can be addressed immediately before it
snowballs. If there is a snag in paying property taxes
6
See
Quicken
Loans,
Let’s
Stay
https://www.quickenloans.com/subscribe.
In
Touch,
25
or mortgage insurance, for example, it is in the interest
of both Quicken Loans and the client to ensure that the
problem is quickly addressed. A call or text is often the
fastest way to achieve that.
B. Phone communication is often the most
efficient way for Quicken Loans to
engage in outreach required by federal
law, and to provide clients in financial
distress with immediate relief.
Quicken Loans also reaches out to clients if they fall
behind on payments—and in many instances, that outreach is required by law. For example, the Consumer
Financial Protection Bureau’s (CFPB) mortgage servicing rules require a servicer to make “live contact” with
a borrower no later than 36 days after the borrower becomes delinquent on his payments.
12 C.F.R.
§ 1024.39(a). Once a servicer makes “live contact,” it
must “[p]romptly . . . inform the borrower about the
availability of loss mitigation options, if appropriate.”
Id. (emphasis added). In Quicken Loans’ experience,
one of the best ways to establish “live contact” to
“promptly” provide information about relief options is
to simply call a client.
Even if federal law does not require it, Quicken
Loans will proactively reach out to clients to provide
immediate relief should they need it. The COVID-19
crisis has left many homeowners unable to timely pay
their mortgages, Quicken Loans’ clients included.
While the CARES Act requires servicers to provide forbearance relief to borrowers who ask for it, it does not
require servicers to broadcast the availability of that
relief to their borrowers. See 15 U.S.C. § 9056. But
Quicken Loans has called and texted clients in tempo-
26
rary financial distress to alert them to the availability
of forbearance options. And after a client enters an initial three-month forbearance period, Quicken Loans
checks in with the client periodically to determine
whether he needs additional time on forbearance, or
whether he is ready to resume making payments. See
Quicken Loans Mortgage Assistance and Client Resources for COVID-19, Rocket Mortgage (May 24,
2020), https://www.rocketmortgage.com/learn/mortga
ge-assistance-covid19. When the client’s forbearance
period is over, Quicken Loans works with the client to
figure out whether additional relief—such as a structured repayment plan for forborne payments, a deferral, or a loan modification—is appropriate and necessary. Id. For many clients, the most effective way to
communicate this information is with a call or a text.
D. An overbroad ATDS definition could
allow plaintiffs to weaponize the TCPA to
hold Quicken Loans liable for engaging
in outreach that is beneficial to its
clients.
The court of appeals’ interpretation of ATDS would
allow plaintiffs to use a warped interpretation of one
consumer-protection statute, the TCPA, to punish
businesses for complying with other consumerprotection obligations or otherwise delivering relief to
consumers in the most timely and effective manner.
Phone calls and text messages are the only effective
ways of timely informing Quicken Loans’ clients about
loss mitigation that must be done “promptly” under
mortgage-servicing regulations. And unlike the prohibition on robocalls to residential lines, the restrictions
on calls to cell phones do not carve out non-solicitation
calls. See 47 C.F.R. § 64.1200(a)(3)(ii). If Quicken
27
Loans made the exact same live call about forbearance
options—one to a residential landline, and one to a cell
phone—only the latter would subject Quicken Loans to
potential TCPA liability. That arbitrary line-drawing
is made possible only by stretching the definition of
ATDS so broadly that it no longer reflects Congress’s
more narrow intent: to stop random and sequentially
dialed calls from taking up precious time on cell
phones. See S. Rep. No. 102-178, at 2.
An overly broad interpretation of ATDS leaves
companies like Quicken Loans with a difficult choice:
proactively reach out to consumers to fulfill disclosure
obligations and face the threat of a TCPA class action
and a statutory penalty of $500 or more for every call
made without express, prior consent, or fail to follow a
federal disclosure mandate and good customer-service
principles by timely communicating with clients to offer much-needed relief. Even if Quicken Loans has
consent from the individuals that it calls, that consent
will not necessarily deter an ATDS lawsuit. Because
consent is a fact-bound affirmative defense, it is typically resolved at the summary-judgment stage, i.e., after burdensome discovery and other proceedings. E.g.,
Orsatti v. Quicken Loans, Inc., No. 15-cv-9380, 2016
WL 7650574, at *6 (C.D. Cal. Sept. 12, 2016) (holding
that evidence of consent “is not properly before the
Court” at the motion-to-dismiss stage, and that “Defendant’s attempts to refute [Plaintiff’s] claim [of lack
of consent] are properly addressed in a motion for
summary judgment”).
This risk of litigation is not a hypothetical one—
Quicken Loans has faced the consequences of its prodisclosure, pro-client approach over the last few years,
thanks to plaintiffs looking to push the ATDS defini-
28
tion to its extreme. In one such case, Fannie Mae engaged Quicken Loans to contact a select group of borrowers eligible for relief under the Home Affordable
Refinance Program (HARP) to assist them with foreclosure avoidance and to help them save money on
their mortgage payments. Newhart v. Quicken Loans
Inc., No. 15-cv-81250, 2016 WL 7118998, at *1 (S.D.
Fla. Oct. 12, 2016). Quicken Loans first tried reaching
out to these clients by mail, and only contacted clients
by telephone several days after sending out its mailers.
Id.
Quicken Loans had difficulty reaching one particular client—the plaintiff’s mother. Id. at *5. After failing to connect several times and leaving several
voicemails, a Quicken Loans representative finally
connected with the plaintiff, who explained that his
mother was not available at that time. When Quicken
Loans tried the number again, the plaintiff attempted
to obtain facts necessary for filing a TCPA suit, such as
the type of dialer used to make the call, how Quicken
Loans obtained the mother’s phone number, and the
questions that Quicken Loans was asking to determine
HARP eligibility. See First Am. Compl. ¶ 43, Newhart
v. Quicken Loans Inc., No. 15-cv-81250 (S.D. Fla. filed
Dec. 11, 2015) (ECF No. 30). The plaintiff filed a nationwide class action soon thereafter.
Even when outreach is not legally required, clients
in financial distress still benefit from quick and efficient communication about options to avoid foreclosure
and stay in their homes. But cases like Newhart
demonstrate that opportunistic plaintiffs armed with
an expansive ATDS definition are willing to use the
TCPA to ensure that “no good deed goes unpunished.”
This has led to an explosive growth in litigation over
29
legitimate business practices that almost mirrors the
explosive growth in robocalls. See U.S. Chamber Institute for Legal Reform, TCPA Litigation Continues to
Skyrocket (Jan. 26, 2017), https://www.institutefor
legalreform.com/resource/tcpa-litigation-continues-toskyrocket-1272-percent-increase-since-2010 (noting a
1,272% increase in TCPA suits between 2010 and the
end of 2016). While the threat of abusive litigation will
not deter Quicken Loans from doing the right thing
and connecting with its clients to ensure that they
have the relief they need in times of financial difficulty,
companies like Quicken Loans should not have to face
the risk of a TCPA class action—and the substantial
costs necessary to defeat such actions—every time they
communicate with their clients over the phone or by
text to offer beneficial services. This is exactly the anti-consumer result that current FCC Chairman Ajit Pai
predicted in protesting an expansive reading of the
TCPA—that such a reading would “leave the American
consumer, not to mention American enterprise, worse
off.” 2015 Order, 30 FCC Rcd. at 8083 (dissenting
statement of Commissioner Pai).
30
CONCLUSION
The judgment of the court of appeals should be reversed.
Respectfully submitted.
WILLIAM M. JAY
Counsel of Record
BROOKS R. BROWN
W. KYLE TAYMAN
ANDREW KIM
GOODWIN PROCTER LLP
1900 N Street, N.W.
Washington, DC 20036
WJay@goodwinlaw.com
(202) 346-4000
September 11, 2020
This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.