Reyes v. Lincoln Auto
Lincoln allegedly continued to make autodialed debt collection calls after plaintiff requested they stop. At summary judgement, the district court found a vaguely addressed, unsigned revocation letter (that defendant claimed it never received) was insufficient to revoke consent (if, and to the extent, consent could be revoked at all).
The appellate court found the district court erred in discounting the revocation letter, as there were actual facts in dispute that raised questions for a jury.
However, the appellate court ruled that plaintiff had no right to revoke consent, as consent was obtained as a “bargained-for consideration in a bilateral contract.” The court discounted rulings in Gager v. Dell (3rd. Circ; 12-2823) and Osorio v. State Farm (11th Circ.; 13-10951), as well as FCC’s 2015 Omnibus ruling, stating those dealt only with consent freely and unilaterally given. In Gager and Osorio, consent was based on knowing provision of a number. Here, the agreement plaintiff signed contained express provisions relating to telephone contact and consent was as irrevocable as any other clause in the agreement. Revoking TCPA consent required the mutual assent of all contracting parties. Since the TCPA did not expressly provide for (unilateral) revocation, “we cannot conclude that Congress intended to alter the common law of contracts in this way.”
The appellate court also rejected the contention that the telephone contact provision should not apply as they were not ‘essential terms.’ Any terms were binding so long as the basic conditions of contract formation (e.g., consideration and mutual assent) were met. Plaintiff could not renege based on the fact the contract could have been formed without the telephone contact provisions.
Finally, the court acknowledged while making revocation impossible by integrating consent into sales contracts may undermine the effectiveness of the TCPA, it was a public policy for Congress – not the courts – to resolve.
[2nd Circ.; 12-2104(Orig: E.D. N.Y.; 2:15-cv-00560)]
jbho: Interesting. This has caused quite a stir in the media. I’m not sure it’s quite the ‘silver bullet’ or ‘game changer’ that some claim. However, it is a pretty huge deal, and definitely worth talking about.
For example, will application be limited to non-marketing calls (i.e. prior express consent)? Don’t forget, by definition, Prior Express Written Consent can’t be a condition of providing a product or service (47 CFR §64.1200(f)(8)). And, per the 2015 Omnibus Rulemaking, there aren’t supposed to be any restrictions on a consumer’s ability to (reasonably) opt-out.
Additionally, the DC Circuit hasn’t yet ruled on the ACA challenge to the 2015 Omnibus Rulemaking (ACA v. FCC – D.C. Circ.; 15-1211), which is addressing the question of revocation as well.
Nonetheless, while it may be premature to start (re)drafting contracts, it is worth noting the clause from the Credit Terms and Conditions indicating plaintiff consented to Ford Credit using ‘any telephone number’ provided by Plaintiff:
“You [Reyes] also expressly consent and agree to Lessor [Ford], Finance Company, Holder and their affiliates, agents and service providers may use written, electronic or verbal means to contact you. This consent includes, but is not limited to, contact by manual calling methods, prerecorded or artificial voice messages, text messages, emails and/or automatic telephone dialing systems. You agree that Lessor, Finance Company, Holder and their affiliates, agents and service providers may use any email address or any telephone number you provide, now or in the future, including a number for a cellular phone or other wireless device, regardless of whether you incur charges as a result.”
I wonder if Ford would have got the same ruling if the calls had been to a skip-traced number?
Another thought – what happens when a third party purchases the debt, becoming the ‘owed first party’ (Henson v. Santander – SCOTUS: 16–349). Will that contractual consent transfer to the new owner? Something else to think about as agreements are (re)drafted.
Finally, what level of negotiation / interaction will be required to sustain an ‘irrevocable consent’? Will browse-wrap and click-wrap agreements be sufficient as well? Note the terms above were part of the original agreement. Might be another story if the terms were included in a subsequent account update.