Since its adoption, the Telephone Consumer Protection Act (“TCPA”) has periodically been attacked as unconstitutional on grounds that it violates the First Amendment right to free speech due to its content-based restrictions. Until today, those attacks have generally failed, leaving defendants with the threat of potentially crippling statutory damages. Today, the Fourth Circuit announced that part of the TCPA, an exemption for calls to collect government debts, is unconstitutional and will be stricken from the Act.

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The FCC recently announced revisions to its debt collection process for those carriers that are delinquent in contributing to the FCC’s Universal Service Fund (“USF”), Telecommunications Relay Services Fund (“TRS”) and North American Numbering Plan Fund (“NANP”) (collectively the “Funds”). Under the new procedures, the Fund administrators will forward delinquent accounts directly to the United States Department of Treasury (“Treasury”) for collection (where a 28% collection fee is added), rather than forwarding them to the FCC first. In addition, the FCC will no longer send delinquency notices to contributors for these types of debts.

These revisions could have a significant impact on telecommunications providers, who now may receive only a single notice before an outstanding debt is transferred to Treasury for collection. Contributors will have to exercise greater diligence to ensure that they receive notices of delinquent obligations to the Funds and do not mistakenly incur collection fees.
 


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