Today's Trends in Credit Regulation

I Have the Right to Change My Mind
By Shawnielle D. Predeoux

Lenders must comply with the Telephone Consumer Protection Act when using an automatic telephone dialing system to call or leave a text message or a pre-recorded message on a cell phone to avoid statutory penalties ranging from $500 to $1500 for each violation. The called party must provide prior express consent before a lender can contact that party on a cell phone using an automatic dialing system. This consent is usually obtained when a customer provides the cell phone number on a credit application.

Can this consent be revoked once it is given? The TCPA does not contain an express revocation right, and federal trial courts have reached varying conclusions. Some of those courts have held that consent cannot be revoked after it is given, while others have held that a called party can subsequently revoke consent either orally or in writing.

In August, the U.S. Court of Appeals for the Third Circuit became the first federal appellate court to decide if a customer can change his or her mind and revoke consent. Here is what happened.

Ashley Gager obtained a credit line from Dell Financial Services, LLC, to purchase computer equipment. Gager provided her cell phone number on the credit application in the space provided for her home phone number. After Gager defaulted on the account, Dell called her cell phone number using an automatic telephone dialing system and left pre-recorded messages on her voice mail.

Gager sent Dell a letter requesting that Dell stop calling her phone number, and she did not state that the number was for her cell phone. Dell made 41 additional calls using an automatic telephone dialing system after receiving the letter. Gager then sued Dell in federal court for violating the TCPA by using an automatic telephone dialing system to call her cell phone after she revoked her prior express consent.

Dell moved to dismiss the complaint for failure to state a claim. The trial court granted the motion, holding that Gager could not revoke her consent because the TCPA did not provide such a right. Gager appealed.

The appellate court reversed the trial court's decision. The appellate court found that a consumer can revoke prior express consent at any time after it is given. The appellate court concluded that consent should be interpreted using the common law, which permits consent to be revoked because consent is voluntary. The appellate court also relied on the remedial purpose of the TCPA to conclude that the statute should be construed in favor of a consumer. Thus, the silence with regard to a revocation right indicates that the right exists. Finally, the appellate court relied on a recent Federal Communications Commission decision indicating that a consumer can revoke prior express consent.

The court of appeals concluded that a customer has a right to change his or her mind. Based on this decision, lenders in the Third Circuit must not use an automatic telephone dialing system to call or text a cell phone number or to leave a prerecorded message after the customer revokes prior express consent. Because lenders often conduct business in multiple jurisdictions, they may want to implement this practice with all customers to avoid potential liability. Additional procedures should also be implemented to determine if the phone number a customer provided is a cell phone number, as lack of knowledge of that fact does not prevent liability.

Gager v. Dell Financial Services, LLC, 2013 U.S. App. LEXIS 17579 (3d Cir. (M.D. Pa.) August 22, 2013).

Shawnielle D. Predeoux is an associate in the Maryland office of Hudson Cook, LLP. She can be reached at 410-865-5425 or by email at

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