Changes Likely for Proposed Robotext Rules

The FCC will likely rework part of its robotexting order, set for a commissioners vote Wednesday, industry lawyers said. Objections were raised on several fronts. One area that could see change is a provision clamping down on the lead generator loophole. The Small Business Administration’s Office of Advocacy elevated the issue when it asked the FCC to seek further comment (see 2312040028), lawyers said.

“From our perspective, it's controversial because of the last-minute shift from what was in the FCC’s original proposal, to this one-to-one consent requirement,” Nelson Mullins’ Steven Augustino, who represents LendingTree in the proceeding, told us. A March Further NPRM (see 2303160061) “went after abusive lead generation by proposing the logically and topically associated standard,” he said: “This one comes in with a much different outcome and that’s ... what has generated the flurry of activity. The concern is that it goes too far” and “hurts the consumers that it’s trying to protect.”

“There’s common agreement ... that annoying and unwanted robocalls are a problem, so there isn’t a political divide on what the problem is,” Augustino added. “We’ve had healthy discussions on the best ways to protect consumers from these lead-generation abuses while empowering them to engage in communications that they want like comparison shopping, across all of the [FCC] offices,” he added.

“I’d expect to see some changes, since there are so many moving parts,” but commissioner aides have been mostly quiet on what to expect, a lawyer with clients concerned about the lead-generation issue said.

“Mobile is a bit harder than fixed with a different regulatory framework,” emailed Recon Analytics’ Roger Entner: “We all dislike messaging spam, but the FCC needs to recognize this.”

CTIA also called for changes to the order. Among them, CTIA asked the FCC to “streamline” the “block upon notice” obligations to give carriers the option to investigate texts the FCC identifies as illegal, rather than compelling them to block the messages. In addition, CTIA asked the agency to revise the discussion of email-to-text “to align with wireless providers’ existing efforts to protect consumers and legitimate message senders” and to make clear that compliance is required only after OMB clears “the investigation, reporting, and certification obligations under the Paperwork Reduction Act, as it was for the prior robocall orders and First Robotext Order.”

“Unlike in the robocalls context, where clear guidance and direction from the FCC were necessary to clarify voice service providers’ authority to block illegal robocalls and now requires that they do so, wireless providers and their messaging partners do not need such direction because text messaging is an information service and wireless providers leverage that flexibility to the benefit of consumers,” CTIA said in its latest filing in docket 02-278 (see 2312070037).

The Competitive Carriers Association also raised concerns about timelines in the order (see 2312060029). CTIA and CCA declined further comment.

In a filing posted Friday, LendingTree reported on a series of meetings at the FCC last week. LendingTree Chairman and CEO Doug Lebda participated in a session with aides to Chairwoman Jessica Rosenworcel.

“LendingTree discussed the ways that comparison shopping sites save consumers money on financial products and level the playing field for small businesses competing for consumers,” the company said: “Unlike some lead generation sites that are accused of tricking customers and ‘harvesting’ their consent, consumers visit LendingTree sites because they are looking for a specific financial product and want to compare a range of offers.”

The Online Lenders Alliance (OLA) also raised concerns. “OLA is leading the way to improve consumer protections, with a set of consumer protection standards to ensure that borrowers are fully informed, fairly treated, and using lending products responsibly,” the group said. The lead-generation provision would harm consumers, limiting their choices, OLA said: “To mitigate some of these challenges, OLA requested that the Commission consider a 12 to 18-month implementation period rather than the 6 months contained in the current proposed rule.”

The Insurance Marketing Coalition (IMC) questioned the legality of proposed prior express written consent (PEWC) requirements. “The Commission lacks statutory authority to prohibit consumers from receiving calls that consumers consent to receive” under the Telephone Consumer Protection Act, IMC said. “The premise of the changes to the PEWC definition” in the order “that ‘prior express consent’ cannot exist where more than one potential seller is listed -- is false and unsupported by the record,” the group said: “To the contrary, IMC and others have explained in their comments how each year millions of satisfied consumers provide prior express consent in this manner.”