On November 22, the FCC issued a Second Report and Order with sweeping implications for the lead generation industry. The FCC has tentatively scheduled the issue for a vote during its December 13, 2023 open meeting. If adopted, the Order would effectuate at least four fundamental changes to the way businesses obtain and utilize consent to communicate with consumers.
Closing the “Lead Generator Loophole”
The new rule would prohibit comparison shopping websites from using a single instance of consent to receive offers or calls on behalf of multiple sellers. The FCC would instead require “one-to-one consent,” meaning that a customer would have to affirmatively consent to being contacted by each and every seller. The new rule would also require these websites to provide clear and conspicuous disclosures stating that the consumer consents to receive robotexts and/or robocalls from each identified seller. The FCC suggests that checkboxes or click-throughs connecting the consumer to the seller’s website so the seller can collect consent directly would suffice. By contrast, the Order specifies that a website that provides a hyperlinked list of sellers covered by a single grant of consent via a single disclosure would not comply with the new rule. Notably, the FCC’s rule does not prohibit consent via an intermediary altogether.
The FCC’s Order would also require that any texts and calls authorized by such consent be “logically and topically related” to the comparison shopping website where consent is collected. The FCC provided one example—that consent obtained on a car loan comparison shopping website is not “logically and topically related” to receiving calls or texts about loan consolidation—but otherwise declined to define how close the relationship must be.
Finally, the Order notes that it would only impact “robocalls and robotexts,” and that it would not prevent callers from availing themselves of other options, such as manually dialed or non-prerecorded or artificial voice calls or texts.
Businesses will have six months from the date the Report and Order is published in the Federal Register to comply.
Confirmation That the National Do-Not-Call (DNC) Registry’s Rules Apply to Text Messages
The Order formally codifies the proposition that existing National DNC Registry rules apply to text messages, in addition to telephone calls. Thus, the FCC affirms that senders must obtain prior express invitation or permission before sending “telephone solicitations” via text to wireless numbers listed on the Registry. In support, the FCC resurfaces prior findings from its 2003 TCPA Order that wireless numbers registered on the National DNC Registry are presumed to be “residential subscribers.”
Proposing to Require Opt-In for Email-to-Text
In the Order, the FCC recommends that providers make email-to-text an opt-in service. It further proposes changing the rule to make opt-in mandatory for email-to-text messages, and invites public comment on topics such as “drawbacks to requiring providers to block such messages” if opt-in consent is not obtained, alternatives to making opt-in mandatory, the proposed definition of “email-to-text,” any other analogous services (such as voicemail-to-text), and proposals for notice and consent requirements.
Requiring Terminating Mobile Wireless Providers to Block All Texts From a Number Following a Report to the FCC
The Order also imposes significant new obligations on terminating mobile wireless providers (“terminating providers”). Once a terminating provider is informed by the FCC of “suspected illegal texts” from a number, the provider must “block all texts from that number” unless the provider’s investigation shows the identified texts are legal. The terminating provider must “promptly investigate” the texts and numbers in question and begin blocking such texts if its review shows the texts to be illegal. Additionally, if the number has been reassigned and the provider cannot block further texts, it must “promptly” notify the FCC and include any supporting documentation it has obtained showing the number has been reassigned. Terminating providers that fail to comply with the new rule would be subject to the FCC’s traditional enforcement processes, including monetary penalties. Additionally, the Order proposes and seeks public comment on additional text blocking options, including (1) expanding the text blocking requirement to also apply to originating providers, (2) requiring the blocking to be based on a standard such as number, source, “substantially similar traffic,” or other “content-neutral reasonable analytics,” (3) adopting a traceback response requirement for texts messaging, (4) other proposed rules to limit illegal text messages, and (5) additional proposals to protect against erroneous blocking.
To read the FCC Second Report and Order, click here.
To read the press release from the FCC, click here.
Why it matters: If adopted, the Order would mandate sweeping changes in the way comparison shopping websites, and potentially lead generators more broadly, operate, and gives businesses just six months after the rule is published to comply. While the FCC does give some concrete examples for how compliant consent may be obtained, the Order also leaves many open questions. The Order also affirms that senders must follow the Do Not Call Registry rules when sending text messages, proposes upcoming changes to email-to-text programs, and places significant new obligations on terminating mobile wireless providers who must now promptly investigate allegations of illegal text messages sent using their services. Manatt can help your business navigate the new requirements and achieve compliance before the implementation period ends.