One of the most aggressive attacks on the Telephone Consumer Protection Act (TCPA) recently made its way to the United States Supreme Court in Barr v. American Association of Political Consultants. With Chief Justice John Roberts questioning why “the whole statute shouldn’t fall” during oral argument, hopes were high that the TCPA might finally be dismantled. Yesterday’s opinion dashed those hopes. While the TCPA challengers technically won, Barr is a loss for all opponents of the TCPA. Instead of striking down the TCPA, the Supreme Court expanded the TCPA’s restrictions to include prohibitions on autodialed calls to collect government debt.

By way of background, 24 years after the TCPA was passed, Congress created an exception to the TCPA, which allowed robocalls to be placed to cellular telephones, so long as the calls were made for the purpose of collecting a debt owed to the government. The American Association of Political Consultants (AAPC), along with three other organizations, filed a lawsuit seeking to have the exception declared unconstitutional on the ground that it treated speech associated with the collection of a government debt different than other speech and therefore violated the First Amendment. The AAPC and related organizations reasoned that they would be more efficient if they could make robocalls to individuals to solicit donations, conduct polls, etc. The trial court held that the exception, although content-based, survived strict scrutiny because it served a compelling government interest. On appeal, the United States Court of Appeals for the Fourth Circuit agreed that the exception was content-based but held it could not survive strict scrutiny.

The Supreme Court agreed with the Fourth Circuit but, instead of striking down the entire TCPA as unconstitutional, severed the government debt exception from the remainder of the TCPA. The result? A statute found to be unconstitutional (with the government debt exception) was tweaked to remove the only exception and now emerges broader than it was before Barr. The Court recognized that the decision whether to sever the unequal exception or strike down the unequal statute was “complex,” but ultimately elected to expand the TCPA’s restrictions. The Court’s reasoning not only broadened the scope of the TCPA, but confirmed that the government can impose broad and significant restrictions on speech (such as the TCPA) so long as those restrictions are applicable to everyone. Equally troubling, the Court seems to have adopted a position that creditors have long known is misguided – that the TCPA actually serves the purpose Congress intended, which is to prevent robocalls and protect the privacy of consumers.

It remains to be seen whether the Barr decision will be applied retroactively, but in the meantime, all private lenders or debt collectors who previously placed robocalls to consumers’ cellular telephones for the purpose of collecting a debt that is either owned or guaranteed by the federal governments – including certain student loans, residential mortgage loans (e.g., VA and FHA loans), farm loans, etc. –  must now scramble to create policies and procedures to ensure compliance with the TCPA. For the rest of the financial services industry, Barr’s message is clear: The TCPA isn’t going anywhere anytime soon.