Client Bulletin: FCC Launches Rulemaking to Create Database(s) For Businesses to Avoid Calling Reassigned Numbers and Potentially Insulate Them from TCPA Liability

On March 23, 2018, the FCC initiated a new proposed rulemaking in its ongoing effort to combat robocalls, the biggest source of consumer complaints the FCC receives, by making available to business callers one or more comprehensive databases providing the current assignment of reassigned telephone numbers to avoid unintended calls by telemarketers to numbers that have been assigned to new subscribers.

The rulemaking is the continuation of an FCC Reassigned Number Notice of Inquiry launched in July 2017, in which the FCC sought comment on various ways to reduce the problem of unconsented to calls to reassigned numbers.  The final impetus for this rulemaking was provided by the DC Circuit, which in its March 2018 opinion (see our prior analysis of the opinion here) rejected the prior Commission’s “one free call” methodology for exempting callers from TCPA liability for calling reassigned numbers.  The court relied in part on the Commission’s NOI exploring the use of comprehensive new databases to vet called numbers and on which callers could rely, replacing the “rough justice” of the Commission’s prior “one free call” solution with a more comprehensive, and consumer-friendly solution.

The FCC recognizes that there are differing views about creating a comprehensive reassigned numbers database.  Many consumer groups, callers and their trade associations, CATV and VoIP providers, and even members of Congress support establishing such a database.  Others contend that the costs to establish such a database are too great – which will be shouldered by calling parties to reimburse the database aggregators and by carriers for their costs in collecting and furnishing the data -, and propose instead that the Commission should encourage the use of commercial database solutions which will incentivize them to improve and make them more widely used.

To advance its regulatory goals, the Commission seeks comment from interested parties about:
  • What information a legitimate caller needs from a reassigned number database, and how an efficient database should work?
  • What information should be provided by a caller to make a search or query of a database?
  • The FCC also asks for comment on its proposal to provide callers with information about when NANP numbers are disconnected, which will enable callers to dispense with numbers on call lists when it knows the subscriber can no longer be reached at that number.
  • How comprehensive should a database be?   Should it contain only disconnected numbers since the database was created?  A subset of allocated numbers?  What if the caller is unable to determine the status of a given number?  Should reported reassignment information be limited to a specific timeframe?
  • How frequently should data be provided to update the database?  Should it be daily or in real time, and if so, what would be the costs to providers for doing so?  Would a rule adopting a minimum aging period for disconnected residential numbers (i.e. of 30-60 days instead the current maximum 90 days) allow for reporting data less frequently?
  • Should user access to the database be limited only to those entities who certify that it is for the purposes of TCPA compliance (and not for marketing)?  Should those who access the database be subject to a registration requirement for tracking purposes?
  • Cost Recovery – a big issue is balancing the legitimate interests of service providers in being compensated for the costs of reporting data to a database against the need for small business callers to be able to have access to the database at a reasonable cost.
  • Safe Harbor?  The FCC seeks comment about adopting a safe harbor from TCPA liability for those callers that consult a reassigned number database under one any of the three approaches that the Commission is considering requiring for database administration: (1) mandatory reporting of data to a single FCC-administered database; (2) mandatory reporting to one or more commercial data aggregators; or (3) allowing service providers to report such data to aggregators on a voluntary basis.
  • Funding?  Should the charge to database users be set on a per query (database dip), flat fee or other basis?  Should remaining costs be recovered from reporting service providers on a competitively neutral basis under Section 251 of the Act?
  • Should all service providers be required to report data into a single FCC-designated reassigned numbers database, including wireless, wireline, and VoIP providers?  Should text messaging providers be required to report as well even if they do not provide voice service?  Should rural service providers be exempted from the reporting requirement due to costs, at least initially?
  • How should covered service providers be compensated for their costs -potentially including new database solutions and operating costs– to report information to an FCC-designated reassigned numbers database?  Would those costs be ultimately recovered from their subscribers?
  • In the case of alternative commercial solutions, such as mandatory or voluntary use of data aggregators, would service providers recover their reporting costs from the aggregators who would in turn recover them from callers querying the databases?  Would commercial aggregators be able to leverage existing infrastructure and respond more quickly initially with less upfront cost?  Would a single database approach however be more cost-effective and efficient in the long run, by enabling service providers and callers to use a single database?
  • What is the legal authority for a safe harbor? Should any establishment of a safe harbor require that a reassigned number database cover at least a certain minimum percentage of allocated numbers to entitle the caller to a safe harbor?
  • Would a voluntary approach result in less comprehensive databases though giving service providers greater flexibility?

The varying views on a comprehensive database or databases, efficiency, funding, and cost recovery (particularly for wireless carriers, which have the vast majority of individual voice subscribers, including text messaging recipients), and a safe harbor from TCPA liability, make this rulemaking one in which service provider, business and consumer entities appear to be lining up to form unusual industry and consumer group alliances.

Comments will be due within 45 days of publication of the rulemaking in the Federal Register.

Note: This Bulletin is not intended as legal advice.  Readers should seek professional legal counseling before acting on the information it contains.