The U.S. Courts of Appeals for the 11th and Sixth Circuits recently issued two rulings regarding when a consumer has given “prior express consent” under the Telephone Consumer Protection Act (TCPA) to receive text messages or cell phone calls from the entity to which the number was given. The TCPA provides that it is unlawful to make autodialed or pre-recorded non-emergency calls to a cell phone number unless the call is made with “the prior express consent of the called party.” This issue is generating numerous TCPA lawsuits.

In the 11th Circuit case, Murphy v. DCI Biologicals Orlando, LLC, et al., the plaintiff had provided his cell phone number to a blood collection center on a donor information sheet in connection with making a paid blood donation. He later received an initial text message from the defendant, a company with a controlling ownership interest in the center, notifying him that unless he replied to stop them, he would receive further text messages. After the plaintiff allegedly failed to reply, he received a second text message offering him a payment for another blood donation.

At issue in Murphy was the effect of a 1992 Federal Communications Commission (FCC) order in which the FCC ruled that “persons who knowingly release their phone numbers have in effect given their invitation or permission to be called at the number which they have given, absent instructions to the contrary.” The plaintiff had argued that the FCC’s interpretation of “express consent,” because it allowed implied consent to suffice, was inconsistent with the TCPA’s plain meaning and that provision of his cell phone number only constituted implied consent. In dismissing the plaintiff’s TCPA claim, the Florida District Court had determined that the FCC’s ruling was binding under the Hobbs Act, which gives exclusive jurisdiction to the federal courts of appeals to review the validity of FCC rulings.

After first determining that the District Court had correctly refused to entertain the plaintiff’s arguments regarding the 1992 ruling’s validity, the 11th Circuit concluded that it was bound to follow the ruling in the absence of direct appeal to review the FCC’s interpretation of “prior express consent.” The 11th Circuit found that by providing his cell phone number on the donor information sheet, which did not specifically request a cell phone number or indicate that providing a cell phone number was a prerequisite for blood donations, the plaintiff had given prior express consent to receive autodialed calls. The Court also noted that federal law did not require provision of a cell phone number for blood donations. (One of the Murphy text messages could be considered a telemarketing call. However, because it was sent in 2012, it was not subject to the current FCC rule requiring prior express written consent for autodialed or prerecorded telemarketing calls to cell phone numbers in the form of an agreement that meets specified requirements.)

In the Sixth Circuit case, Hill v. Homeward Residential, Inc., the plaintiff had provided his cell phone number to the assignee of his mortgage loan before and after falling behind on his mortgage payments. He first gave his cell phone number to the assignee after it acquired his loan to replace his home phone number on its records. He then provided his cell phone number on a loan modification agreement after falling behind on his loan payments and on other forms in connection with attempts to mitigate his losses after the modification failed. The assignee allegedly made numerous collection calls to the plaintiff’s cell phone number.

At issue in Hill was a 2005 FCC ruling which stated that a person provides express consent to receive autodialed debt collection calls by providing his or her cellular telephone number “to a creditor in connection with an existing debt” and that “prior express consent [to receive such calls] is deemed to be granted only if the wireless number was provided by the consumer to the creditor, and that such number was provided during the transaction that resulted in the debt owed.” The District Court had instructed the jury that autodialed calls are made with the called party’s prior express consent if they are made to a wireless number “provided by the called party to a creditor in connection with an existing debt.” The jury ruled against plaintiff.

On appeal, the plaintiff argued that the jury instruction was inadequate because it did not inform jurors that prior express consent requires the wireless number to be provided during the “initial transaction” that resulted in the debt owed. Observing that the FCC never used the word “initial” before “transaction” in its 2005 ruling, the Sixth Circuit concluded that the FCC’s use of the phrase “during the transaction” was intended to ensure “that a debtor who gives his number outside the context of the debt has not given his consent to be called regarding the debt.”

The Sixth Circuit ruled that since prior express consent for autodialed collection calls only requires the wireless number to be provided by the called party in connection with an existing debt, the jury instruction adequately informed the jury of the law. According to the Sixth Circuit, a debtor does not have to provide his cell phone number at the beginning of a debtor–creditor relationship (such as in a credit application) for the number to be given “in connection with an existing debt” and that “a person gives his ‘prior express consent’ under the statute if he gives a company his number before it calls him.” The Sixth Circuit also stated that a debtor’s general consent for cell phone calls is sufficient to provide prior express consent for autodialed collection calls without the need for specific consent to autodialed calls.

Ballard Spahr’s TCPA Task Force assists clients in navigating the complex and challenging issues that arise under the TCPA. The Task Force, which comprises regulatory attorneys and litigators, provides counsel on TCPA compliance and avoiding TCPA liability, including reviewing policies and practices and helping to design mobile text message and prerecorded and autodialed call campaigns. It also assists clients in handling scrutiny from regulators, including preparing for examinations, responding to investigations, and defending against enforcement actions. Task Force members also defend clients against TCPA class or individual actions.

Ballard Spahr’s Consumer Financial Services Group is nationally recognized for its guidance in structuring and documenting new consumer financial services products, its experience with the full range of federal and state consumer credit laws, and its skill in litigation defense and avoidance (including pioneering work in pre-dispute arbitration programs).

If you have questions, please contact Consumer Financial Services Group Practice Leader Alan S. Kaplinsky, TCPA Task Force Chair Mark J. Furletti, John L. Culhane, Jr., or Daniel JT McKenna.

Copyright © 2015 by Ballard Spahr LLP.
(No claim to original U.S. government material.)

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This alert is a periodic publication of Ballard Spahr LLP and is intended to notify recipients of new developments in the law. It should not be construed as legal advice or legal opinion on any specific facts or circumstances. The contents are intended for general informational purposes only, and you are urged to consult your own attorney concerning your situation and specific legal questions you have.

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