On April 1, 2021, the Supreme Court of the United States issued its highly anticipated decision in the Facebook Inc. v. Duguid matter. In a unanimous decision delivered by Justice Sonia Sotomayor, the Supreme Court addressed a hotly debated issue of statutory construction regarding the Telephone Consumer Protection Act ("TCPA"), and reversed the Court of Appeals for the Ninth Circuit's decision holding that Facebook, Inc. ("Facebook") used a text-message notification system that met the TCPA's definition of an "autodialer." In short, the Court held that Facebook's notification equipment did not meet the definition of an autodialer because it does not use a random or sequential number generator. The Court rejected Plaintiff Noah Duguid's more broad interpretation of the statute, noting that if an autodialer were any device that had the capacity to dial random numbers, the TCPA would encompass any equipment that stores and dials telephone numbers, such as a modern smartphone.
The key language in the TCPA at issue is the definition of an "autodialer" or "automatic telephone dialing system" ("ATDS") contained in 47 U.S.C. § 227(a)(1). The TCPA defines an ATDS as equipment with the capacity both "to store or produce telephone numbers to be called, using a random or sequential number generator," and to dial those numbers. Facebook, whom Plaintiff accused of sending unwanted "login notification" text messages to his cellular phone, argued that the TCPA does not apply to its communications to Plaintiff because it did not use a "random or sequential number generator." Plaintiff disagreed, arguing that Facebook's notification system had the capability to store telephone numbers, and, independently, to produce telephone numbers with a random or sequential number generator, even if that is not how his cellular phone was chosen to receive messages from Facebook.
The Court framed the issue as whether the definition of an autodialer "encompasses equipment that can 'store' and dial telephone numbers, even if the device does not 'us[e] a random or sequential number generator,'" and concluded, succinctly, "[i]t does not," because to qualify as an ATDS, a device "must have the capacity either to store a telephone number using a random or sequential generator or to produce a telephone number using a random or sequential number generator." Indeed, Facebook's notification system was not random; it sent targeted and individualized messages for a specific purpose.
The Court's analysis focused heavily on statutory construction. While Plaintiff argued that the terms "randomly generated" only applied to the last verb mentioned in the relevant pairing ("produce telephone numbers"), the Court held that those terms applied to both verbs ("store or produce telephone numbers"). This conclusion stemmed, in part, from a tool of statutory construction called the "series-qualifier" cannon. From this somewhat dry, grammatical analysis sprouts a critical conclusion - that the definition of an ATDS "excludes equipment like Facebook's login notification system," because it is not "equipment [that] use[s] a random or sequential number generator." With respect to the "series-qualifier" canon, Justice Samuel Alito issued a concurring opinion, noting that he generally agreed with the Court's decision and judgment, but criticized the Court's "heavy reliance on [the series-qualifier canon] that has come to play a prominent role in our statutory interpretation cases." Justice Alito's concern is that the Court's reliance on the series-qualifier canon was mechanical and inflexible, as it does not "generally reflect the most natural reading of a sentence," but ought to be used in a more nuanced and contextual manner.
Aside from the grammatical analysis, the Court assessed the various policy considerations behind passage of the TCPA (such as the desire to prevent clogging of emergency telephone lines), along with the implications of the Court attempting to unilaterally expand on Congress's definition of an autodialer. Artfully, Justice Sotomayor remarked "[e]xpanding the definition of an autodialer to encompass any equipment that merely stores and dials telephone numbers would take a chainsaw to these nuanced problems when Congress meant to use a scalpel." Such expansion "would capture virtually all modern cell phones" and "could affect ordinary cell phone owners in the course of commonplace usage, such as speed dialing or sending automated text message responses." While Plaintiff warned that adoption of this interpretation would lead to a "torrent of robocalls," the Court quelled Plaintiff's alarm, noting its decision does not impact the TCPA's separate prohibition on use of an "artificial or prerecorded voice." Ultimately, the Court held that Plaintiff's "quarrel is with Congress, which did not define an autodialer as malleably as he would have liked."
The Duguid decision should have sweeping ramifications in nationwide TCPA litigation. Unless Congress expands the definition of an autodialer, or otherwise modernizes the TCPA from its 1990s origins, Duguid will likely reduce the number of TCPA claims filed in state and federal courts. Especially in the financial services industry, many institutions have various automated systems in place to contact customers when certain conditions are met: fraud alerts, payment notifications, privacy alerts, credit alerts, collections - the list goes on and on. These institutions, in light of the Duguid decision, face less risk of being tagged with a lawsuit alleging that their systems involve an autodialer, so long as it is clear that the messages are individuated and sent for a specific purpose, rather than as mass communications for broad telemarketing purposes.
This article is presented for informational purposes only and is not intended to constitute legal advice.