The Secure Times

An online forum of the ABA Section of Antitrust Law's Privacy and Information Security Committee

The Third Circuit Rules Consumers May Opt-Out of Autodialed Calls at Any Time

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For the first time, a federal court of appeals ruled that a consumer may at any time revoke prior consent to receive autodialed or prerecorded calls to a cell phone number.  Gager v Dell Financial Services, LLC (3d Circuit, No. 12-2823, filed Aug. 22, 2013).  Under the Telephone Consumer Protection Act (“TCPA”), any person making a call to a cell phone using automatic telephone dialing equipment must have the prior express consent of the person called, unless there is an emergency. 47 U.S.C. §227(b)(1)(A).   The TCPA is silent as to what constitutes prior express consent or when express consent may be revoked.  In addition, the Federal Communication Commission (“FCC”) has not clearly defined when consent may be revoked.

The plaintiff in the case sued Dell Financial Service (“Dell”) for violating the TCPA by repeatedly placing debt collection calls to her cell phone after she sent a written letter to Dell listing asking Dell to stop making calls to her number.  The plaintiff had listed her cell phone number as her home phone on the credit application, but never informed Dell that it was her cell phone.

The Third Circuit’s ruling reverses the district court’s dismissal of the case.  The district court granted Dell’s motion to dismiss on the grounds that the TCPA does not provide for “post-formation revocation of consent” and that, although the plaintiff had the right to instruct Dell not to place autodialed calls to her cell phone, the request should have been made at the time she filled out her credit application.

On appeal, Dell argued that the TCPA’s silence on the right to revoke consent indicates that no such right exists.  In support of its argument, Dell pointed to the difference between the TCPA and the Fair Debt Collection Act, which expressly provides a right for consumers to stop unwanted debt collection calls.

The Third Circuit rejected this argument, reasoning that if Congress intended to displace the common law principle that consent may be revoked at any time, it would have done so clearly.  In addition, the court ruled that since the TCPA was enacted as a remedial statute to protect individuals from unwanted phone calls, it should be construed to benefit consumers.  Finally, the court reasoned that the FCC’s SoundBite Communications declaratory ruling last year implicitly supports the principle that consent may be revoked at any time.  In the SoundBite ruling, the FCC held that a one-time text message confirming a consumer’s request to opt-out of receiving text messages does not violate the TCPA if it is sent within five minutes of the opt-out request and does not contain any marketing consent.

Dell also argued that debt collection calls should not be subject to the prior express consent requirement because they are not telemarketing calls, but are an informational call and not covered by the TCPA.  The court rejected this argument because the TCPA does not distinguish between autodialed telemarketing and informational calls to cell phones.  Rather, the TCPA clearly prohibits any call to a call phone made using automatic equipment without the prior express consent of the called party, unless it is an emergency.  The exception for informational calls only applies to calls made to residential lines.

Importantly for businesses which may not know whether customers have provided cell phone numbers, the court also rejected Dell’s argument that the plaintiff’s number should be treated as a residential number because the plaintiff provided it as a home number and never informed Dell it was for her cell phone.  The court noted in a footnote that “Callers have a continuing responsibility to check the accuracy of their records to ensure that they are not inadvertently calling mobile numbers.” (citing In the Matter of Rules and Regulations Implementing the Telephone Consumer Protection Act of 1991, 19 FCC Rcd. 19215, 19219-20 ¶ 11 (Sept. 21, 2004)).

Finally, the court rejected Dell’s arguments that it would be unfair to allow the plaintiff to revoke consent.  Dell first argued it would be unfair because the consent was part of the original contract to extend credit.  Second, Dell argued it would be unfair to allow creditors to revoke consent because the inability of a creditor to use autodialing equipment would make it “difficult, if not impossible” for creditors to contact borrowers regarding their loan.  The court rejected these arguments because the ability to use autodialers to contact borrowers is not an essential term to a credit agreement and because the creditor could still contact borrowers with live calls.


Although the result of the Gager decision may not be surprising, it serves as a reminder of the breadth of the TCPA and important compliance steps:

  1. The TCPA requires prior express consent to make any call to a cell phone using automatic dialing equipment or prerecorded messages.
  1. It is the responsibility of the person making the calls to determine whether they are is placing calls to a cell phone.   Businesses should either scrub call lists to remove cell phone numbers or implement procedures to obtain and keep records of consent from their customers prior to placing autodialed or prerecorded calls.
  1. Businesses must have in place procedures to honor requests to stop making autodialed or prerecorded calls to cell phones.  These opt-out requests may be made by individuals through any means.  Additionally, there is no grace period for processing opt-out requests under the TCPA or the FCC’s rules, thus they should be processed as soon as possible.

It is also important to note that the Gager case comes less than two months before new FCC rules under the TCPA will come into effect.   As of October 16, 2013, the TCPA rules will require the following types of consent:

  1. Telemarketing Calls:  Autodialed or prerecorded calls to cell      phones and prerecorded calls to residential lines require prior express      written consent.  The request      for written consent must: (i) clearly and conspicuously disclose that      the consumer is consenting to receive future autodialed or prerecorded      calls, as applicable, to the number provided for telemarketing purposes;      (ii) include the recipient’s signature (which can be an electronic      signature if consistent with E-SIGN or state law); and (iii) not make the      consent to receive such calls a condition of purchasing any goods or      services.
  1. Informational Calls:  Autodialed or prerecorded calls to cell phones require prior express consent (which may be oral or written), but autodialed or prerecorded calls to residential lines do not require prior consent.


Obtaining, and retaining proof of, proper consent is important because the TCPA provides a private right of action for actual damages or statutory damages of up to $500 per violation (and up to $1,500 per knowing or willful violation).  As a result, TCPA violations can create significant liability.  For example, last year a Jiffy Lube franchisee settled a TCPA for between $35 and $47 million for sending text messages to customers without proper consent.

Author: Eric Whisler

Associate at Vorys, Sater, Seymour and Pease LLP.

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