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September 2015 TCPA Compliance Monitoring Report

On August 28, 2015, the Federal Communication Commission’s (“FCC”) Consumer and Governmental Affairs Bureau (“CGB”) released a declaratory ruling clarifying that an electronic/internet fax is subject to the TCPA and the FCC’s rules governing fax advertisements. CGB also clarified that the end user to whom the fax is ultimately directed is the recipient of an electronic/internet fax for TCPA purposes. CGB declined to adopt specific opt-out notice language for a fax advertisement and declined to determine at what point a fax broadcaster become sufficiently involved in sending a fax as to be liable for TCPA violations.

An electronic/internet fax is a document sent as a conventional fax that is converted to a digital file and delivered to a consumer as an email attachment. The electronic/internet fax is created when a fax sent over a telephone line to the recipient’s fax number is converted to a digital image file or PDF by a fax server on the receiving end of the transmission. After the owner of a fax server filed a TCPA lawsuit against a fax broadcaster, Westfax, another fax broadcaster, filed a petition for declaratory ruling with the FCC in 2009 seeking clarification of:

• whether an electronic/internet fax is a fax, an email or both;
• whether the restrictions on unsolicited fax advertisements apply to electronic/internet faxes;
• whether the definition of a fax recipient under the rules applies when the recipient receives an electronic/internet fax;
• whether it is a TCPA violation to send an electronic/internet fax to someone who has consented to receive traditional faxes or has an established business relationship;
• whether the FCC would issue a standard, “safe harbor” opt-out notice for faxes; and
• whether a third party who is retained to accept opt-out requests is deemed to be giving advice on how to comply with the fax advertising rules and, therefore, would be subject to TCPA liability based on its “involvement” in sending a fax.

In explaining why an electronic/internet fax constitutes a fax under the TCPA, CGB noted that the plain language of the TCPA makes it unlawful to send an unsolicited advertisement to a telephone fax machine. An electronic/internet fax is sent as a traditional fax over a telephone line, and CGB concluded that a fax server constitutes a telephone fax machine. Moreover, CGB found it incongruous to treat a fax sent to a standalone fax machine differently from a computer server designed to receive a fax, especially because the sender does not know what device will receive the fax.

On the other hand, a fax sent as an email over the Internet would not be subject to the TCPA, according to CGB. However, a commercial email with an attached fax may be subject to the CAN-SPAM Act, although CGB declined to determine how the CAN-SPAM Act would apply to such a message.

CGB also clarified that the party to whom a fax is ultimately directed is the recipient of a fax under the TCPA. An entity that converts a fax to email at its fax server and sends that email to the ultimate recipient is not the recipient of the fax for purposes of the TCPA because it is not the intended audience for the fax. Instead, CGB likens a fax server provider to a telephone company that becomes “part of the communications pathway between the sender and the recipient.” Therefore, a fax server provider could not initiate a TCPA lawsuit for a fax received by its fax server unless it is the intended recipient of the fax.

CGB did not explicitly address Westfax’s question about whether sending an electronic/internet fax to someone who has consented to receive a traditional fax or to someone with whom the sender has an established business relationship violates the TCPA. However, CGB did clarify that an electronic/internet fax is subject to the TCPA and the FCC’s related rules. Presumably, therefore, an electronic/internet fax would be subject to the same consent or established business relationship standards as a traditional fax.

Finally, CGB declined to adopt “safe harbor” opt-out notice language for a fax advertisement and declined to determine at what point a fax broadcaster becomes involved in sending a fax advertisement. In refusing to adopt specific opt-out notice language, CGB noted that the FCC’s rules identify the content of a fax advertisement opt-out notice. Providing this content, but not specific opt-out notice language, gives a fax sender flexibility in complying with the FCC’s rules. CGB also declined to clarify whether a third party, including a fax broadcaster, who is retained to accept opt-out requests is sufficiently “involved” in sending a fax to incur TCPA liability because the record provided by Westfax and the comments to the petition did not provide a sufficient basis upon which to make a decision. However, the FCC has found that a fax broadcaster must demonstrate a high degree of involvement or have actual notice of unsolicited faxes sent using its system to be liable under the TCPA. 

If you have questions regarding your company’s compliance with the TCPA, please contact Linda McReynolds, lgm@commlawgroup.com – 703-714-1318; Jane Wagner, jlw@commlawgroup.com – 703-714-1321; or Robert Jackson, rhj@commlawgroup.com – 703-714-1316.