2024 Year in Review: Telephone Consumer Protection Act

Looking Ahead to 2025

Companies were mere hours away from implementing radical changes to lead forms and consent capture methodologies before the one-to-one consent rule was paused and then vacated. As noted below, the one-to-one consent rule would have required, among other things, consumers to provide consent to be contacted by one seller at a time. In reaction to the rule’s demise, we anticipate class action litigants and regulators will challenge the validity of consent where the form is inconsistent with the spirit of the one-to-one rule and attempts to obtain consent for a large number of callers, or for callers that offer products and services that are not logically and topically related to the lead form.

The Federal Communications Commission (FCC) will continue to debate how and to what extent artificial intelligence (AI) can be used in telemarketing campaigns.

State-level mini–Telephone Consumer Protection Act (TCPA) lawsuits may increase as plaintiffs’ firms continue to look for ways to navigate the post-Duguid environment.

The Supreme Court heard argument on McLaughlin Chiropractic Associates, Inc. v. McKesson Corporation in January 2025, regarding whether the Hobbs Act, 28 U.S.C. § 2342, requires district courts to accept the FCC’s interpretation of the TCPA. Depending on the ruling and whether the FCC can continue to rely on its Hobbs Act authority to interpret the TCPA’s meaning, TCPA litigation may be affected.

In the News

The FCC continued to make headlines in 2024, with rules regarding how AI can be used to make telemarketing calls and by pursuing an enforcement action against lead generators in the lead-up to the 2025 effective date of the now vacated one-to-one consent rules. As Goodwin predicted in our previous year in review, states continued to propose and enact mini-TCPA laws or propose refinements to existing laws.

FCC Notice of Proposed Rulemaking: AI-Generated Robocalls

In July, the FCC proposed new rules regarding the use of AI to generate robocalls (Proposed AI Rule). The Proposed AI Rule introduces steps to limit the use of AI in marketing calls to consumers while at the same time purporting to offer incentives for “positive uses of AI” by providing exemptions for AI use to improve accessibility for individuals with disabilities. The comment period for the Proposed AI Rule was extended, and industry groups continued to file new comments through the end of 2024.

If enacted, the Proposed AI Rule would change the TCPA regulations’ prior express consent requirements by requiring callers using AI-generated calls, defined as “a call that uses any technology or tool to generate an artificial or prerecorded voice or a text using computational technology or other machine learning […] to process natural language and produce voice or text content to communicate with a called party over an outbound telephone call,” to include a “clear and conspicuous disclosure that the consumer’s consent to receive artificial and prerecorded calls may include consent to receive AI-generated calls.” The Proposed AI Rule would also require “callers using AI-generated voice to, at the beginning of each call, clearly disclose to the called party that the call is using AI-generated technology.” Under the Proposed AI Rule, any artificial or prerecorded voice calls using AI made by an individual with a speech or hearing disability would be exempt if the AI technology is designed to facilitate the ability of the individual to communicate over the telephone.

In the notice announcing the Proposed AI Rule, the FCC also sought comments on technologies that can detect potentially fraudulent or AI-generated calls in real time, alert consumers, and block similar future calls.

One-to-One Consent Rule Dies in the Final Hours

In December 2023, the FCC adopted a rule it proposed in March 2023 that targeted what the FCC called the “Lead Generator Loophole” and required websites to obtain one-to-one consent for calls and texts made for marketing purposes using an automatic telephone dialing system (ATDS), prerecorded message, or artificial voice. The rule also restricted calls from one-to-one consent to only those products and services that were topically and logically related to the lead generation site from where the consent was sourced. The rule was set to take effect on January 27, 2025. However, just three days before its effective date, on January 24, 2025, the U.S. Court of Appeals for the Eleventh Circuit struck down and vacated the FCC’s one-to-one consent rule in Insurance Marketing Coalition Limited v. Federal Communications Commission. And shortly before the decision, the FCC stayed implementation of the rule in light of the pending decision from the Eleventh Circuit. This decision means that the rule will not go into effect as initially planned, and the existing TCPA regulations and requirements remain in effect, allowing bundled consent to continue.

The Eleventh Circuit’s decision was prompted by a challenge from the Insurance Marketing Coalition (IMC), which argued that the FCC exceeded its authority under the TCPA by interpreting “prior express consent” to mean that a consumer can authorize no more than one identified seller at a time. The court sided with the IMC, stating that the FCC’s one-to-one consent restriction could not be squared with the plain understanding of “prior express consent.”

The FCC’s postponement of the rule’s effective date and the subsequent court decision have created uncertainty about how the FCC will respond and whether it will pursue a revised rule to limit the number of sellers a consumer can provide consent to at any one time.

For now, lead generators and lead buyers can continue to operate in compliance with the existing TCPA frameworks and requirements relating to prior express consent. Nonetheless, the industry should proceed cautiously because both the FCC and Federal Trade Commission have taken enforcement action against lead generators when the consent obtained was for too many sellers or for product and services not topically and logically associated with the lead form on the grounds that consumers were deceived and could not provide effective consent.

FCC Revises Rule on Revoking Consent

In February, the FCC adopted a new rule clarifying how companies must honor a consumer’s revocation of prior consent to receive telemarketing calls using an ATDS or prerecorded voice. The rule states that consumers should be able to revoke consent in “any reasonable way.” The FCC specifically rejected requests from businesses suggesting that consumers and businesses should be able to enter into contracts concerning the method of opt out, instead proposing a rule that the consumer may unilaterally choose the opt-out method with the caveat that a business may later “have the opportunity to prove why the method used [was] not reasonable.”

Although the FCC initially proposed a 24-hour time frame for businesses to honor opt outs, in response to public comments, the final rule states that a business has a window of “10 business days after receipt of the request” to honor an opt out.

The new rule will become effective in April 2025.

States Continue to Implement and Amend Mini-TCPA Statutes

As Goodwin predicted in 2023’s year in review, states continued to play a role in telemarketing legislation through newly enacted and amended state mini-TCPA statutes in 2024.

As one example, Georgia’s Senate Bill 73, which amended and significantly expanded the state’s telemarketing law, went into effect in July 2024. The law provides for vicarious liability for telephone solicitations made by a third party on behalf of another person or entity. The Georgia law provides for liability even in circumstances in which the caller does not “knowingly” make a telephone solicitation to an individual on the state’s Do-Not-Call list.

The Georgia law includes two safe harbors. First, an entity is not vicariously liable for calls made on its behalf if it has established policies and procedures with the third party making the calls to prevent violation and has enforced compliance with such policies. Second, the law provides a defense if a telephone solicitation is made to a telephone number that was provided in error by another subscriber “so long as the defendant to such action did not know, or have reason to know, that the telephone number was provided in error.”

The Georgia attorney general has authority to initiate proceedings related to violations and can impose a civil penalty of up to $2,000 for each violation. Affected individuals may also bring a private action to recover actual damages of up to $1,000 for each violation, as well as reasonable attorney fees and costs. Notably, for class actions, the amendment removes the $1,000 actual-damages-per-violation cap and allows affected individuals to bring an action (individual or class) against the person or entity that made the telephone solicitation, the person or entity that the telephone solicitation was made on behalf of, or both.

Other states, such as Michigan and West Virginia, have introduced legislation concerning the use of ATDS and other state-level telemarketing restrictions. Similar legislation is likely to continue to make its way through state legislatures in 2025.

Key Trends From 2024

TCPA Litigation

The number of TCPA lawsuits filed annually continues to remain well below pre-Duguid levels. TCPA litigation increased in 2024, with 1,210 actions filed between January 1, 2024, and August 31, 2024. This number is 4.4% higher than it was in 2023 but still trending below the pre–Facebook, Inc. v. Duguid, 141 S. Ct. 1163 (2021), levels, when there were more than 3,000 lawsuits in the 2019 to 2020 time frame, and is far from the peak TCPA class action litigation year of 2016, which saw 4,770 actions filed. Looking ahead to 2025, with the recent changes to Georgia’s and other states’ mini-TCPA statutes, along with those in states that we covered in our previous year in review (i.e., Maryland, New York, and Connecticut), there could be an increase in state law–based telemarketing litigation on the horizon.

Session Replay Technology Continues to Be Challenged

As Goodwin previewed in the previous two editions of its year in review, “session replay” technology continues to face litigation from plaintiffs alleging that the technology violates state wiretapping and privacy laws. This technology is commonly used to validate TCPA consent obtained through a website.

In October 2024, the Massachusetts Supreme Judicial Court decided Vita v. New England Baptist Hospital and clarified that Massachusetts’ Wiretap Act is not applicable to the use of third-party technology. Because the Wiretap Act is a criminal statute, the court relied on the “rule of lenity” and concluded that the Wiretap Act’s definition of “wire communication,” which includes “any communication made […] by the aid of wire, cable, or like connection between the point of origin and point of reception” did not extend to web browsing. The court expressed a concern about imposing criminal penalties based on a content neutral restriction on the use of tracking technology (such as session replay and pixel technology). While this decision will make it more difficult for consumers to allege Wiretap Act violations solely based on the use of third-party technology embedded into websites, the court did express concern that the use of such technology could violate common law and other privacy protections.

Outside of Massachusetts, there continues to be significant litigation filed in California state and federal courts alleging violations of the California Invasion of Privacy Act based on the same technology. The coming year may be when businesses and technology providers finally get clarity from the California appellate courts on the contours of permissible uses of such technology.

This informational piece, which may be considered advertising under the ethical rules of certain jurisdictions, is provided on the understanding that it does not constitute the rendering of legal advice or other professional advice by Goodwin or its lawyers. Prior results do not guarantee similar outcomes.