Sacramento, Calif. (April 2, 2021) - On April 1, 2021, the U.S. Supreme Court unanimously reversed the Ninth Circuit Court of Appeal's interpretation of the definition of "automatic telephone dialing system" (ATDS), or autodialer, under the Telephone Consumer Protection Act (TCPA). The Court held that a "necessary feature" of an ATDS "is the capacity to use a random or sequential number generator to either store or produce phone numbers to be called." The Court's strict statutory interpretation of ATDS could prove to be a major impediment to the TCPA plaintiffs' bar, which has argued the definition of ATDS covers equipment that can store and dial telephone numbers, or be modified to do so, even if the equipment does not use a random or sequential number generator.
The plaintiff in Facebook, Inc. v. Duguid sued Facebook for sending him multiple unsolicited warnings via text message that an attempt had been made to log in to his account from a new device or browser. (The plaintiff had never registered for a Facebook account). Facebook argued that the equipment it used to send text messages to the plaintiff does not constitute an ATDS within the meaning of the TCPA because the technology it used did not use a random or sequential number generator.
In its highly-anticipated opinion, the Court wrote that,
"Congress' definition of an autodialer requires that in all cases, whether storing or producing numbers to be called, the equipment in question must use a random or sequential number generator" (emphasis added).
To support its holding, the Court analyzed the statutory intent behind the TCPA and found that the statute was drafted to attack telemarketing equipment that creates a risk of dialing emergency lines randomly, or tying up the sequentially numbered phone lines at a single place of business/entity. It reasoned that, to expand the definition of an ATDS to include "any equipment that merely stores and dials telephone numbers would take a chainsaw to these nuanced problems when Congress meant to use a scalpel."
The Court criticized attempts to interpret the meaning of ATDS to include equipment with the sole capacity to store and dial telephone numbers by noting that almost all cell phones would be subject to the TCPA under such an interpretation. Contrary to the plaintiff's and Ninth Circuit's broad interpretation of ATDS, the Court noted that Congress created the definition of ATDS to apply only to technology that uses random or sequential number generator technology, and nothing more.
Finally, the Court addressed the plaintiff's concern that assenting to Facebook's interpretation of ATDS would "'unleash' a 'torrent of robocalls.'" Rejecting this argument, the Court reasoned that the plaintiff's worries were overstated because the TCPA separately addressed the use of an artificial or prerecorded voice when placing calls to home phones and cell phones.
The Court's decision in the Facebook case comes after years of ambiguity regarding the definition of an ATDS following piecemeal rulings across states and federal appellate circuits, as well as guidance from the Federal Communications Commission that many industry participants and counselors found uncertain. TCPA practitioners and consumer-facing businesses will be watching closely to see whether the FCC or Congress will respond to this ruling.
The full Supreme Court decision can be found here.
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