Ninth Circuit Doubles Down on Duguid

TCPA Connect

Doubling down on its recent decision in Duguid v. Facebook, the U.S. Court of Appeals for the Ninth Circuit reiterated in an unpublished memorandum that the exception for government debt to the Telephone Consumer Protection Act (TCPA) is unconstitutional.

California consumer Steve Gallion filed a putative class action against Charter Communications and Spectrum Management Holding Company, alleging that the defendants made calls in violation of the TCPA. The defendants responded with a challenge to the constitutionality of the statute.

The panel looked to its recent decision in Duguid, where it became the second federal appellate court to rule that the “debt-collection exception” of the TCPA, which exempts calls made solely to collect a debt owed to or guaranteed by the United States, was an unconstitutional restriction on speech under the First Amendment.

However, the Ninth Circuit stopped short of striking down the entire statute.

When Charter and Spectrum raised similar constitutional issues, the panel looked no further than Duguid to affirm denial of their motion for judgment on the pleadings.

“Consistent with [Duguid], we hold that the 2015 amendment to the TCPA, which excepts calls ‘made solely to collect a debt owed to or guaranteed by the United States,’ is a content-based speech regulation that fails strict scrutiny, and thus is incompatible with the First Amendment,” the court wrote, leaving intact the remainder of the statute.

The defendants’ arguments that other provisions of the TCPA—such as the delegation to the Federal Communications Commission (FCC) and the claimed government speakers’ preference—are unconstitutional also failed, the panel said. “These provisions were part of the pre-2015 TCPA challenged and upheld as constitutional in [Moser v. FCC],” a 1995 Ninth Circuit decision, the court explained.

“Because we conclude in Duguid that the unconstitutional debt-collected exception is severable, the TCPA is restored to its pre-2015 status and is constitutional under our precedents,” the panel wrote.

The defendants also challenged several FCC orders promulgating exceptions to the TCPA, but the panel found that those issues were not properly before the court. “The proper venue to challenge an FCC order is directly in a court of appeals, not in the district court,” the panel wrote.

To read the opinion in Gallion v. United States, click here.

Why it matters: The Ninth Circuit reiterated its position initially expressed in Duguid, ruling that the government-backed debt-collection exception is unconstitutional and should be severed from the TCPA. While the court returned the statute to its pre-2015 amendment days, the parties in Duguid continue to fight. Defendant Facebook signaled its intent to appeal the decision to the U.S. Supreme Court, while the government asked the Ninth Circuit to reconsider its holding that the debt-collection exception is unconstitutional.