US Second Circuit Court Rules: FCC Withdrawal of Fax Rule Applies Nationwide
In a case that has been making its way through the US legal system since 2017,
... a split Second Circuit panel on Friday rejected a challenge to the Federal Communication Commission's decision to eliminate a rule that required opt-out notices on solicited faxes, finding that a D.C. Circuit ruling that the regulation was invalid applied nationwide.2nd Circ. Says FCC Properly Axed Solicited Fax Opt-Out Rule, Law 360, 3 Dec 2021
Apparently, this was the story. The US Federal Communications Commission regulates federal fax rules in the USA. For some reason, in the distant past, it decided that even where two parties had a pre-existing business relationship and agreed to receive each other's faxes, any fax sent still had to carry a notification of how to opt out of receiving future faxes.
This rule was made out of whole cloth by the FCC with no legal basis, which is why it was challenged and rejected in the courts:
On March 31 , the U.S. Court of Appeals for the D.C. Circuit struck down a Federal Communications Commission (FCC) rule requiring that solicited fax advertisements contain a notice on how to opt out of future faxes. Following the ruling, such opt-out notices will be required only in unsolicited fax advertisements.D.C. Circuit Strikes FCC’s Rule Requiring Opt-Out Notice on Solicited Faxes, McGuire Woods, 4 Apr 2017
But the applicability of the withdrawal was challenged by parties likely hoping for commercial gain from a class-action lawsuit they had riding on this decision. Happily, the negation of the negation how now been negated 🤡🎉:
[The court] upheld the FCC decision to withdraw the rule—which requires even faxes sent with permission to include instructions for opting out of future correspondence...FCC ‘Solicited Fax Rule’ Is Dead Nationwide, Second Circuit Says, Bloomberg Law, 3 Dec 2021
Update 7 Dec 2021: A very clear narrative is provided by the National Law Review in Second Circuit Puts Final Nail in the Solicited Fax Rule Coffin, detailing how far back this started (FCC rule from 2006), what the different stages were (conclusion of the rule being unlawful and repeal in 2014, first lawsuit agains the repeal in 2017, etc.), and how this latest ruling is a highly technical detail in jurisprudence.
So technical in fact, that we challenge any non-lawyer to figure out what this even means:
Finally, after explaining how the doctrine of nonacquiescence allows an agency to adhere to its interpretation of a statute notwithstanding a court’s or courts’ interpretation to the contrary, the Second Circuit found such doctrine foreclosed here by the Hobbs Act. “[T]he Hobbs Act establishes a ‘special statutory reviewing proceeding’ that channels all of the pre-enforcement facial challenges to an FCC order that could ever arise to a single court tasked with deciding the validity of the order.Second Circuit Puts Final Nail in the Solicited Fax Rule Coffin, National Law Review, 7 Dec 2021
Update 9 Dec 2021: Mondaq offers a clearer explanation to the complicated bits of the judgment, and in fact relates it to current-day COVID cases:
... [The appellant] Gorss Motels argued that the D.C. Circuit's opinion was only binding law in Washington, D.C. Normally, one Circuit Court's decision does not bind another Circuit. However, as the FCC argued, an uncommon federal statute requires that all challenges to a rule, such as that of Gorss Motels, be sent to one appellate court for evaluation.
More recently, this same process was used to channel all challenges to the federal COVID-vaccine mandate to the Sixth Circuit Court of Appeals. As the Second Circuit explained, this "challenge consolidation" statute ensures uniformity and finality, avoiding different interpretations of the same rule which may depend on the location of a particular business or person.
Accordingly, the Court rejected Gorss Motels' argument and treated the D.C. Circuit's decision as binding.Appeals Court Affirms FCC's Rule Repeal In Fax Marketing Decision, Mondaq, 9 Dec 2021
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