Soundboard v. FTC
Defendant’s MSJ granted – The FTC recently reversed its opinion on Soundboard technology. The Soundboard technology that allows snippets of prerecorded messages to be played during live agent calls, are now subject to Robocall restrictions under the TSR. In 2009, the FTC issued an informal opinion that Soundboard calls were not subject to the TSR’s Robocall restrictions, based on the two-way nature of such calls. In updating its opinion, the FTC stated improper use of the technology – non-responsive messages being played and live agents not intervening in calls – led to increased complaints, warranting the reconsideration. Soundboard challenged the opinion, arguing the reversal constituted a ‘legislative rule,’ which should have been subject to a notice and comment period. Soundboard further argued the change represented an unconstitutional restriction on commercial speech.
The court found:
1) The opinion, although reviewable, was not a legislative rule.
Since the opinion imposed “an immediate and significant practical burden” on the telemarketing industry, it was a reviewable agency action. However, the opinion represented an ‘interpretive rule,’ as it communicated the agency’s view that an existing regulation now applied to a particular form of telemarketing technology as currently used by industry. Notice-and-comment procedures were not needed for this new ‘interpretive rule’ (just as they were not needed for the original 2009 opinion).
2) The reclassification represented a (constitutional) content-neutral regulation of speech.
The opinion called out valid time, place, and manner restrictions. As found previously by several courts, such Robocall restrictions did not constitute content-based discrimination. The technology could always be used where appropriate consent had been obtained, and messages could be delivered though other channels (media advertising, mailings, websites, in-person solicitations, etc.), as well as through live calls.
Revocation of the 2009 opinion is effective 12 May 2017.
jbho: If you use Soundboard or other technology that allows live agents to play prerecorded voice samples – even on a voicemail – you should be getting appropriate consent.
I’m sure this opinion will waterfall into the TCPA arena. I’ve already seen more that couple TCPA cases that said use of a prerecorded voice alone was sufficient to establish TCPA liability. Another interesting twist in TCPA land.