A creditor that received a consumer's cell phone number through an intermediary had the consumer's ''prior express consent'' under the Telephone Consumer Protection Act (TCPA) to receive calls from a debt collector, the U.S. Court of Appeals for the Sixth Circuit has ruled.

In Baisden, et al. v. Credit Adjustments, Inc., the plaintiffs, who had received services at a hospital from an anesthesiology group (Group), filed a putative class action alleging that a debt collector attempting to collect bills owed by the plaintiffs to the Group violated the TCPA by placing autodialed and prerecorded collection calls to their cell phone numbers. The TCPA prohibits autodialed or prerecorded non-emergency collection calls to cell phone numbers unless the call is made with ''the prior express consent of the called party.''  The debt collector argued that the plaintiffs had consented to its calls by virtue of providing their cell phone numbers to the hospital on admission forms.

In affirming the district court's grant of summary judgment in favor of the debt collector, the Sixth Circuit relied on several Federal Communications Commission (FCC) rulings and orders. This includes the FCC's 2008 ruling that autodialed or prerecorded collection calls made to a wireless number given by the called party to a creditor in connection with an existing debt are made with the called party's "prior express consent." The Sixth Circuit rejected the plaintiffs' attempt to limit the ruling's application to situations where the called party provides a wireless number directly to the creditor. According to the Court, the FCC's rulings and order "make no distinction between directly providing one's cell phone number to a creditor and taking steps to make that number available through other methods, like consenting to disclose that number to other entities for certain purposes" and "make clear that there is no one way for a caller to obtain consent, and that such consent can be conveyed by another party." (emphasis included).

The Court concluded that "the provision of a cell phone number to a hospital that then provides that cell phone number to an affiliated physicians' group that provided medical services to a consumer arising out of the same occurrence can constitute 'prior express consent' under the TCPA." In reaching this conclusion, the Court relied on the 11th Circuit's decision in Mais v. Gulf Coast Collection Bureau, Inc. which, in a similar patient scenario, held that provision of a cell phone number to a hospital intermediary can supply "prior express consent."

Having concluded that the TCPA allowed the plaintiffs to give "prior express consent" to the Group by providing their cell phone numbers to the hospital, the Court examined the language of the admission forms to determine whether the plaintiffs had in fact given their consent. The Court found that language in the admissions forms authorizing the hospital's use of their "health care information" for purposes that included billing, payment, and collection and its release of such information to third parties permitted the hospital to disclose their cell phone numbers to the Group. The Court determined that the case "fits comfortably" within the FCC's limits on "prior express consent" because of the context in which the plaintiffs provided their cell phone numbers. According to the Court, they had provided their numbers to the hospital in the course of seeking medical treatment and authorized the hospital to disclose the numbers to others. In addition, the Group to whom the numbers were disclosed had a "significant relationship" to the plaintiffs and hospital "and most critically, the debts owed by plaintiffs…arose from the transactions in which plaintiffs provided their cell phone numbers."

Relying on its prior decision in Hill v. Homeward Residential, Inc., the Sixth Circuit rejected the plaintiffs' argument that language in the FCC's 2008 ruling required the cell phone numbers to have been provided "during the transaction that resulted in the debt owed," namely, during the anesthesiology services. In Hill, the Sixth Circuit concluded that such language 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,'' and ruled that "prior express consent" only requires the wireless number to be provided by the called party in connection with an existing debt.

While Baisden holds that a consumer can give "prior express consent" under the TCPA for collection calls by providing his or her cell phone number to an intermediary, creditors and debt collectors should confirm that there are no other applicable laws that might limit their use of cell phone numbers to contact consumers.  

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).


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