Am. Ass'n of Political Consultants, Inc. v. Fed. Commc'ns Comm'n

• Decision Date: 24 April 2019
• Docket Number: No. 18-1588,18-1588
• Citation: 923 F.3d 159
• Parties: AMERICAN ASSOCIATION OF POLITICAL CONSULTANTS, INC.; Democratic Party of Oregon, Inc.; Public Policy Polling, LLC ; Washington State Democratic Central Committee, Plaintiffs – Appellants, and Tea Party Forward PAC, Plaintiff, v. FEDERAL COMMUNICATIONS COMMISSION; William P. Barr, in his official capacity as Attorney General of the United States, Defendants – Appellees.
• Court: U.S. Court of Appeals — Fourth Circuit

923 F.3d 159

AMERICAN ASSOCIATION OF POLITICAL CONSULTANTS, INC.; Democratic Party of Oregon, Inc.; Public Policy Polling, LLC ; Washington State Democratic Central Committee, Plaintiffs – Appellants,andTea Party Forward PAC, Plaintiff,

v.FEDERAL COMMUNICATIONS COMMISSION; William P. Barr, in his official capacity as Attorney General of the United States, Defendants – Appellees.

No. 18-1588

United States Court of Appeals, Fourth Circuit.

Argued: December 12, 2018

Decided: April 24, 2019

ARGUED: William Edward Raney, I, COPILEVITZ & CANTER LLC, Kansas City, Missouri, for Appellants. Lindsey Powell, UNITED STATES DEPARTMENT OF JUSTICE, Washington, D.C., for Appellees. ON BRIEF: Kellie Mitchell Bubeck, COPILEVITZ & CANTER LLC, Kansas City, Missouri; Charles George, WYRICK ROBBINS YATES & PONTON LLP, Raleigh, North Carolina, for Appellants. Chad A. Readler, Acting Assistant Attorney General, Mark B. Stern, Michael S. Raab, Appellate Staff, Civil Division, UNITED STATES DEPARTMENT OF JUSTICE, Washington, D.C.; Robert J. Higdon, Jr., United States Attorney, OFFICE OF THE UNITED STATES ATTORNEY, Raleigh, North Carolina, for Appellees.

Before KING, KEENAN, and QUATTLEBAUM, Circuit Judges.

Vacated and remanded by published opinion. Judge King wrote the opinion, in which Judge Keenan and Judge Quattlebaum joined.

KING, Circuit Judge:

The American Association of Political Consultants, Inc. and three other plaintiffs (hereinafter the "Plaintiffs") appeal from a summary judgment award made by the district court to the defendants, the Federal Communications Commission (the "FCC") and the Attorney General (collectively the "Government"). See Am. Ass’n of Political Consultants v. Sessions , 323 F.Supp.3d 737 (E.D.N.C. 2018) (the "Opinion").¹ The Plaintiffs initiated this litigation in May 2016 in the Eastern District of North Carolina, alleging that part of the Telephone Consumer Protection Act of 1991 (the "TCPA") contravenes the Free Speech Clause of the First Amendment. As pertinent here, the TCPA prohibits calls to cell phones by use of an automated dialing system or an artificial or prerecorded voice, subject to three statutory exemptions (the "automated call ban"). The Plaintiffs allege that one of the statutory exemptions to the automated call ban — created by a 2015 TCPA amendment — is facially unconstitutional under the Free Speech Clause. That exemption authorizes automated calls that relate to the collection of debts owed to or guaranteed by the federal government (the "debt-collection exemption").² According to the Plaintiffs, the free speech infirmity of the debt-collection exemption is not severable from the automated call ban and renders the entire ban unconstitutional.

In awarding summary judgment to the Government in March 2018, the Opinion rejected the free speech challenge interposed by the Plaintiffs. The district court applied strict scrutiny review to the debt-collection exemption and ruled that it does not violate the Free Speech Clause. As explained below, we agree that strict scrutiny review applies in this case but conclude that the debt-collection exemption does not satisfy such a review. As a result, we agree with the Plaintiffs that the debt-collection exemption contravenes the Free Speech Clause. In agreement with the Government, however, we are satisfied to sever the flawed exemption from the automated call ban. We therefore vacate the judgment and remand.

I.

A.

Enacted in 1991, the TCPA was a response by Congress to the reactions of American consumers over intrusive and unwanted phone calls. As a result of congressional concern with automated phone calls, the automated call ban prohibits phone calls to cell phones that use "any automatic telephone dialing system or an artificial or prerecorded voice." See 47 U.S.C. § 227(b)(1)(A).³ The automated call ban does not, however, reach and prohibit all calls made with those technologies. For example, the TCPA authorizes automated phone calls to cell phones if they satisfy one of the statutory exemptions specified in the automated call ban. When it was enacted in 1991, the TCPA created two statutory exemptions to the ban, both of which are yet in effect. Under the first exemption, if an automated call to a cell phone is initiated "for emergency purposes," it does not contravene the automated call ban (the "emergency exemption"). See id. Pursuant to the second statutory exemption, an automated call made to a cell phone with "the prior express consent of the called party" likewise does not violate the ban (the "consent exemption"). See id.

For more than twenty years, the emergency and consent exemptions were the only statutory exemptions to the automated call ban. In 2015, however, Congress enacted the third statutory exemption — the debt-collection exemption — and therein excepted from the ban all calls to cell phones "made solely to collect a debt owed to or guaranteed by the United States." See Bipartisan Budget Act of 2015, Pub. L. No. 114-74, § 301(a), 129 Stat. 584, 588 (2015) (amending 47 U.S.C. § 227(b)(1)(A)(iii) ).⁴ In addition to the statutory exemptions, automated calls made by the federal government itself are not barred by the automated call ban. See Campbell-Ewald Co. v. Gomez , ––– U.S. ––––, 136 S.Ct. 663, 672, 193 L.Ed.2d 571 (2016) ("The United States and its agencies, it is undisputed, are not subject to the TCPA’s prohibitions."). With the foregoing statutory framework in mind, we turn to the proceedings in the district court.

B.

In May 2016, the Plaintiffs filed this lawsuit in the Eastern District of North Carolina, alleging, inter alia, that the debt-collection exemption to the automated call ban contravenes their free speech rights because it is a content-based restriction on speech that fails to satisfy strict scrutiny review. According to the complaint, the debt-collection exemption creates a regime that permits — and thereby unconstitutionally favors — a select group of otherwise prohibited automated calls to cell phones. The complaint also alleges that whether an automated phone call satisfies the debt-collection exemption, and thus escapes the prohibitions of the automated call ban, depends on the call’s content. The Plaintiffs therefore allege that the debt-collection exemption to the ban contravenes the Free Speech Clause.

In 2017, the Plaintiffs and the Government each moved in the district court for summary judgment. By its Opinion of March 26, 2018, the court denied the summary judgment request of the Plaintiffs and awarded summary judgment to the Government. In so ruling, the court rejected the Free Speech Clause challenge of the Plaintiffs. At its outset, the Opinion correctly recognized that the Free Speech Clause prohibits a restriction on speech that is predicated on " ‘its message, its ideas, its subject matter, or its content.’ " See AAPC , 323 F.Supp.3d at 742 (quoting Reed v. Town of Gilbert , ––– U.S. ––––, 135 S.Ct. 2218, 2226, 192 L.Ed.2d 236 (2015) ). As the Opinion explained, such content-based speech restrictions " ‘are presumptively unconstitutional’ " and are only permissible if they satisfy strict scrutiny review. See id. (quoting Reed , 135 S.Ct. at 2226 ). That is, the Government must establish that content-based speech restrictions have been narrowly tailored to further a compelling governmental interest.

Although the Opinion ruled that the debt-collection exemption to the automated call ban is constitutional, it initially recognized the exemption as a "content-based speech restriction." See AAPC , 323 F.Supp.3d at 743. As the district court explained, the debt-collection exemption "makes content distinctions on its face." Id. To support that proposition, the court drew on a decision from a California court and explained that whether an automated phone call to a cell phone qualifies for the exemption "derives from the call’s communicative content," and requires a court to review such content. Id. (citing Gallion v. Charter Commc’ns Inc. , 287 F.Supp.3d 920, 927 (C.D. Cal. 2018) ).

In accepting the proposition that the debt-collection exemption makes content-based distinctions, the Opinion rejected — for two reasons — the Government’s contention that the exemption is based only on "the relationship between a caller and a recipient," and not on the call’s content. See AAPC , 323 F.Supp.3d at 743. First, the Opinion observed that the " ‘plain language of the [debt-collection exemption] makes no reference whatsoever to the relationship of the parties.’ " Id. (quoting Gallion , 287 F.Supp.3d at 927 ). Second, the district court explained that the Government sought to justify the exemption on the basis of the relationship between the federal government and the debtor, i.e., the call-recipient. As the Opinion recognized, however, the debt-collection exemption is not limited to calls from the federal government to the cell phones of debtors. The exemption also provides statutory protection for " ‘a third party [who] has no preexisting relationship with the debtor [call-recipient].’ " Id. (quoting Gallion , 287 F.Supp.3d at 927 ). As such, the court was satisfied that the debt-collection exemption is predicated on the subject matter of the phone call rather than on the caller’s relationship to the recipient thereof.

Notwithstanding the content-based restriction imposed by the debt-collection exemption, the Opinion ruled that it does not contravene the Free Speech Clause. The district court thus rejected the proposition advanced by the Plaintiffs that the exemption undermines the narrow tailoring of the automated call ban. In that regard, the court agreed with the Government that the exemption does not subvert the privacy interests furthered by the ban. The Opinion therefore concluded that the debt-collection exemption to the automated call ban satisfies strict scrutiny review.⁵ That is, the exemption does not hinder the automated call ban from furthering the compelling governmental interest of protecting "the...