Bais Yaakov of Spring Valley v. FCC
In 2006, the Federal Communications Commission (FCC) promulgated a regulation under the Telephone Consumer Protection Act (TCPA) that requires companies sending fax advertisements to include “opt-out” information on the faxes they send, even if the companies have prior permission from the recipient to send such faxes. The so-called opt-out regulation therefore requires companies to provide contact information that a consumer can use to request that the company stop sending fax advertisements. Many companies failed to provide the required opt-out information, and consumers filed lawsuits under the TCPA, which provides a private right of action for violations of TCPA regulations.
In 2014, the FCC granted companies’ requests for retroactive waivers for previous violations of the opt-out regulation and waived future violations for another six months. The FCC granted the waivers based on the companies’ vague allegations that they were “confused” about whether they had to obey the regulation. The FCC indicated it would grant waivers to all similarly situated companies, and in all, the FCC granted 142 waivers of the regulation. The FCC granted the waivers even though it affirmed that its regulation clearly required companies to provide the opt-out notices.
In an amicus brief in the D.C. Circuit, Public Citizen argued that the FCC’s retroactive waivers were not justified under the D.C. Circuit’s case law, were not in the public interest, and were arbitrary and capricious. In a March 2017 opinion, the D.C. Circuit held that the FCC lacked authority to require a company to include an opt-out notice on faxes to numbers that had previously agreed to accept faxes from the company. The court therefore dismissed as moot the petition challenging the FCC’s waiver.