NC Federal Court Permits Suit Based on FCC Internal DNC Registry Violation

TCPA Connect

Widening a split among courts that have considered the issue, a North Carolina district court held that a violation of the Do Not Call (DNC) regulations of the Federal Communications Commission (FCC) triggered liability under the Telephone Consumer Protection Act (TCPA).

The plaintiff, Jonathan Fischman, allegedly registered his cellphone number on the FCC’s DNC Registry on December 19, 2004. Beginning in late 2018, Fischman claimed that he began receiving unsolicited calls to his cellphone about purchasing extended vehicle warranties.

When he returned one of the calls on January 10, 2019, he somehow determined that the number was associated with an affiliate of MediaStratX. Fischman asked the agent to stop calling him, but he received at least nine more calls between January 10 and January 30, 2019.

Fischman filed suit against MediaStratX in 2020, alleging violations of the TCPA and related FCC implementing regulations, including the requirement under 47 C.F.R. § 64.1200(d) for telemarketers to maintain internal DNC lists. MediaStratX moved for judgment on the pleadings. It argued that the court lacked subject matter jurisdiction due to a lack of constitutional standing and that no private right of action exists for alleged violations of the internal DNC regulations in 47 C.F.R. § 64.1200(d).

U.S. District Judge James C. Dever III of the Eastern District of North Carolina disagreed, denying the motion.

As to subject matter jurisdiction/standing, the TCPA recognizes a cognizable constitutional injury due to an intrusion on a plaintiff’s privacy rights by unsolicited telemarketer calls, Judge Dever said, an injury that is not “ethereal or abstract.”

“Fischman has alleged a concrete injury,” the court wrote. According to the plaintiff, he registered his cellphone number with the DNC registry and received over 25 unsolicited telemarketing calls from multiple numbers. He told the callers that he did not wish to receive any more unsolicited calls, but he continued to receive them. “Thus, Fischman has plausibly alleged a cognizable constitutional injury sufficient to support Article III standing,” the court said.

Turning to the question of Fischman’s claims under the FCC regulations, Judge Dever explained that the FCC did not state under which subsection of 47 U.S.C. § 227 it promulgated 47 C.F.R. § 64.1200(d). Congress explicitly created a private right of action for regulations promulgated under Section 227(c) of the TCPA, the court said, but did not explicitly or implicitly create a private right of action for violations of what some have called the “technical” or “procedural” regulations promulgated under Section 227(d) of the TCPA, which encompass the internal DNC requirements (e.g., that companies have an internal policy in place, maintain internal DNC lists, train their employees, etc.).

Courts across the country are split on the issue. The U.S. Court of Appeals, Sixth and Eleventh Circuits—as well as district courts in Florida, Massachusetts and Tennessee—have held that the FCC promulgated Section 1200(d) of the regulations under Section 227(c) of the TCPA, and therefore that plaintiffs have a private right of action for violations of those regulations.

But another group of courts—primarily district courts in Ohio, Oklahoma and Maryland as well as the U.S. Court of Appeals, Fourth Circuit—have ruled that Section 1200(d) of the FCC regulations was promulgated under Section 227(d) of the TCPA, leaving plaintiffs without a private right of action.

Judge Dever sided with the first group. “The plain text of the procedures described in section 64.1200(d) corresponds with 47 U.S.C. § 227(c)’s requirements that the FCC promulgate rules to protect residential telephone subscribers’ privacy rights,” the court wrote. “Section 227(d)’s plain text, on the other hand, concerns standards governing ‘telephone facsimile machine[s],’ ‘automatic telephone dialing system[s],’ and other automated telemarketing devices.”

Additionally, in contrast to the text of Section 227(d), the text of Section 227(c) directs the FCC to “develop proposed regulations to implement the methods and procedures that the Commission determines are most effective and efficient to accomplish the purposes of this section.”

“Thus, the text of 47 U.S.C. § 227(c)(1)(E) and (d) supports the conclusion that the FCC promulgated 47 C.F.R. § 64.1200(d) under 47 U.S.C. § 227(c)(1)(E), not section 227(d),” the court said.

Judge Dever found the reasoning of the courts with contrary holdings—relying on the title of Section 227(d), which provides for “procedural standards,” and recognizing that the standards prescribed by 47 C.F.R. § 64.1200(d) are procedural—insufficient.

The title of a statute and the heading of a section cannot limit the plain meaning of the text, he said.

“Accordingly, Congress explicitly provided a private cause of action for Fischman’s … claims, and the court denies MediaStratX’s motion for a judgment on the pleadings,” Judge Dever concluded.

To read the order in Fischman v. MediaStratX, LLC, click here.

Why it matters: The North Carolina federal court’s decision highlights the growing split among courts on the issue of whether TCPA plaintiffs have a private right of action under 47 C.F.R. § 64.1200(d). Courts and litigants have made compelling arguments on both sides of the coin as to whether the internal DNC regulations should provide for a private right of action under the TCPA, and this split may continue to widen until someone appeals this issue to the Supreme Court. Nevertheless, having an internal DNC policy in place and following it would certainly help defendants avoid such claims.



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