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What About Bob? Supreme Court Weighs TCPA Judicial Review Process

What about Bob?  That was the question posed by Supreme Court Justice Neil Gorsuch during oral argument today in a case examining whether federal district courts have jurisdiction to review FCC orders governing the Telephone Consumer Protection Act in light of the Hobbs Act (which grants exclusive jurisdiction to the courts of appeals to review such orders in certain circumstances). 

Gorsuch outlined a hypothetical situation involving a regulation requiring everyone named Bob to pay a fine.  The process for challenging such a regulation involves publication of a notice in the Federal Register and a short period of time for judicial review thereafter.  But what about the Bobs born later?  What about those who don’t know (or can’t know) whether they will potentially be affected by the new rule?  Would young Bob be forever barred from challenging the regulation in court? 

Setting aside the tongue-in-cheek nature of Gorsuch’s hypo, the justice hit upon a key issue facing the Supreme Court now:  does the procedure outlined in the Hobbs Act governing challenges to the FCC’s final TCPA orders provide the only, end-all avenue for challenging the validity of an order?  If so, as Justice Gorsuch suggested, it would seem that future litigants who never previously contemplated being hauled into court to face TCPA claims would have no ability to challenge the FCC’s interpretation of the statute during the course of litigation.

The case before the high court today is PDR Network, LLC v. Carlton & Harris Chiropractic Inc., No. 17-1705.  As previously outlined, it involves an unsolicited fax sent by the publishers of the Physicians’ Desk Reference to the office of a chiropractor, who sued PDR Network under the TCPA.  PDR Network argues that because the desk reference is provided free of charge, the fax falls outside the scope of an “unsolicited advertisement” as regulated by the TCPA.  That argument prevailed in the district court, but the Fourth Circuit reversed, holding that the district court erred in appealing to the statute.  Instead, the lower court should have reviewed only the FCC’s 2006 order which, the Fourth Circuit held, unambiguously applied to any fax solicitation even without a clear commercial aim. 

At issue is the scope and meaning of the Hobbs Act, invoked by the circuit court in demanding deference to the FCC’s interpretation of the TCPA.  The Hobbs Act, 28 U.S.C. § 2342, grants exclusive jurisdiction to the courts of appeals “to enjoin, set aside, suspend (in whole or in part), or to determine the validity of” the FCC’s orders interpreting the TCPA.  According to the Fourth Circuit Court of Appeals, the Hobbs Act serves to “strip[] jurisdiction from the district courts” in cases that turn on an interpretation of the FCC’s TCPA orders.  Importantly, PDR Network did not challenge the FCC’s order in 2006 pursuant to the Hobbs Act process; it did not transmit its allegedly offending fax until 2013.

The case is a critical one for debt collectors, mortgage servicers, or any other business that may face TCPA liability—but the impact of the Court’s eventual decision may cut both ways. If the Court holds that any litigant can challenge the FCC’s orders (i.e., outside the Hobbs Act process) it may provide TCPA defendants, such as PDR Network, an avenue for narrowing the FCC’s otherwise broad proclamations on what constitutes actionable conduct under the statute. On the other hand, while such a result may provide a path for one-off victories in court, the result may be a patchwork of different interpretations of the TCPA in different circuit and district courts across the country, increasing compliance costs and decreasing predictability (to say nothing of the fact that an FCC ruling favorable to the industry would always be subject to revision by the courts).

Mark RooneyTCPA, Hobbs Act