New FCC Rule Creates TCPA Reassigned Numbers Database

Business Litigation Update

Date: April 08, 2019

Key Notes:

  • The FCC has created a reassigned numbers database as part of its efforts to protect consumers from unwanted robocalls under the TCPA.
  • It also established a safe harbor from TCPA liability for companies that rely upon the database.

Although companies routinely contact their customers using automated dialing equipment, a recent (and major) spike in litigation from individuals who have been reassigned a former customer’s number (and thus have not given consent to be called) has companies rethinking how they communicate. Fortunately, companies now have guidance on how to handle reassigned numbers.

On March 26, 2019, the Federal Communications Commission (FCC) published a Final Rule in the Federal Register that amends the Telephone Consumer Protection Act (TCPA). Previously, in December 2018, the FCC released its Advanced Methods to Target and Eliminate Unlawful Robocalls, Second Report and Order (Order) summarizing its creation of a single comprehensive database for reassigned numbers and a limited safe harbor based on the use of and reliance on that database.

With statutory damages or penalties ranging from $500 to $1,500 per call and consumers frequently changing cell phone numbers, there has been no shortage of TCPA litigation. These claims are especially prevalent in the financial services industry, where banks, servicers, debt collectors and debt buyers are likely to make numerous calls to borrowers whose accounts are in default. Although the database and safe harbor can certainly be a tool in a TCPA defendant’s arsenal, there are potential limitations:

  • When queried, the database will provide an answer of “yes,” “no” or “no data.” The safe harbor only applies when the database provides a “no” response. A company will need to assess its risk tolerance for calling numbers that receive a response of “no data” and/or develop policies and procedures specifically directed to these “no data” numbers.
  • The FCC expressly declined to expand the safe harbor from the information available in the most recent update to the database. As a result, any caller who intends to rely on the database will need to access it monthly and retain the records necessary to prove it accessed and relied on the database.
  • The safe harbor only applies to situations where the caller accessed the database and actually relied on the information provided. Because this will be a fact-intensive inquiry, application of the safe harbor will not be suitable to avoid TCPA claims by filing a motion to dismiss. That said, the safe harbor could reduce the likelihood for liability on a class-wide basis due to the existence of individualized issues.
Reassigned Numbers Database

The Order and Final Rule provide for the creation of a single comprehensive database that will contain information related to disconnected numbers so a caller can determine whether a number has been permanently disconnected (and thus reassigned) prior to making a call. The database will have the ability to process both low- and high-volume queries, and it will be possible for callers to use third-party contractors to scrub their calling lists.

Permanent disconnection of a number occurs “when a subscriber permanently has relinquished the number, or the provider permanently has reversed its assignment of the number to the subscriber such that the number has been disassociated with the subscriber. A [North American Numbering Plan] telephone number that is ported to another provider is not permanently disconnected.” In addition to expressly excluding situations where a number is ported from one provider to another, this definition is intended to exclude numbers that were temporarily disconnected for nonpayment.

Telephone providers are required to keep accurate and complete records related to permanently disconnected numbers on a going-forward basis, and they will be required to report to the database administrator the date of the most recent permanent disconnection for each number allocated or ported to the provider.

When queried, the database will provide a response of “yes,” “no” or “no data” to indicate whether the number has been permanently disconnected since the date provided, which should be a prior date on which the caller is confident the number was associated with the consumer the caller is attempting to reach.

Safe Harbor

In addition to creating the database, the FCC adopted a safe harbor for those callers who rely on the database to determine if a number has been reassigned. Pursuant to this safe harbor, a caller will not be liable for violating certain provisions of the TCPA (namely, 47 C.F.R. §§ 64.1200(a)(1), (2), or (3)) if the caller (who bears the burden of proof and persuasion) demonstrates that:

  • they queried the most recent update of the database and received a response of “no,” thus verifying that the number has not been permanently disconnected since the caller obtained prior express consent, and
  • the call was the result of erroneous information in the database.

In clarifying the safe harbor’s scope, the FCC said it “should not be broadly applied to all calls made by a caller who uses the database without regard to whether the caller reasonably relied on the database when making a particular call.”

Next Steps

The FCC directed the North American Numbering Council to assess and address the database’s technical and operational issues and provide recommendations for its implementation, including a Technical Requirements Document, on or before June 13, 2019.

Although the Final Rule became effective March 26, 2019, compliance will not be required until the FCC publishes documents announcing the compliance dates in the Federal Register.

FOR MORE INFORMATION

For more information, please contact:

Jessica E. Salisbury-Copper
937.443.6854
Jessica.Salisbury-Copper@ThompsonHine.com 

Richard A. Freshwater
216.566.5764
Richard.Freshwater@ThompsonHine.com 

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