On July 12, 2022, Representatives Raja Krishnamoorthi, D-Ill., and Katie Porter, D-Calif. introduced H.R. 8334 in the U.S. House of Representatives, which was referred to the Committee on Energy and Commerce. The bill would amend the Telephone Consumer Protection Act (the “TCPA”), 47 U.S.C. § 227, to, among other things, “prohibit the use of automated telephone equipment to send unsolicited text messages.”
The TCPA presently defines “automatic telephone dialing system” (or “ATDS”) as equipment that has the capacity “to store or produce telephone numbers to be called, using a random or sequential number generator . . . to dial such numbers.” The law generally prohibits any person from making nonconsensual telemarketing or other types of telephone calls to a cell phone number using an ATDS.
Last week, the U.S. Court of Appeals for the Third Circuit concluded that the TCPA’s definition of “automatic telephone dialing system” (or “ATDS”) includes all dialing equipment with the present ability to generate random or sequential phone numbers and dial those numbers, regardless of whether the equipment’s owner actually uses those “ATDS functionalities.” But, importantly, a caller must actually use such functionalities in order to violate the statute’s prohibition on making autodialed phone calls, the Court further held.
In other words, a dialing system’s status as an ATDS turns on the system’s present capabilities, not how it is used. But whether a defendant is liable for using an ATDS turns on how the system is used, not just what it can do. Thus, the Court read the ATDS definition broadly but the liability provision narrowly, in a ruling that will give some comfort to companies that use their dialing equipment to contact customers or prospects from set lists, rather than to randomly generate phone numbers to be called indiscriminately.
Courts in the Southern District of California and District of Arizona recently added to the line of decisions addressing ATDS pleading requirements in the wake of the Supreme Court’s landmark ruling in Facebook v. Duguid. Declining to infer that targeted text messages warranted an inference that the sender used an ATDS, the courts in Wilson v. rater8, LLC, et al., No. 20-cv-1515, 2021 WL 4865930 (S.D. Cal. Oct. 18, 2021), and DeClements v. Americana Holdings LLC, No. CV-20-00166-PHX-DLR, 2021 WL 5138279 (D. Ariz. Nov. 4, 2021), dismissed plaintiffs’ complaints for failure to sufficiently allege the use of an ATDS.
In Wilson v. rater8, the plaintiff filed a class action alleging that defendants violated the TCPA by sending him, after a medical examination, a text asking him to provide feedback regarding his examining physician. 2021 WL 4865930. The plaintiff alleged that the text was sent using an ATDS. The court granted defendants’ motion to stay pending the outcome of the Supreme Court’s decision in Facebook. Following that ruling, defendants moved to dismiss, arguing that plaintiff did not allege sufficient facts to support the claim that an ATDS was used.
The Sixth Circuit recently became the first federal court of appeals to weigh in on whether plaintiffs can bring TCPA claims for conduct occurring between November 2015 and July 2020—the respective dates on which the unconstitutional government debt exception was passed and the Supreme Court’s decision in Barr v. AAPC declared it unconstitutional and severed it from the statute. Some district courts, such as the District of Louisiana in Creasy v. Charter Communications, Inc., 2020 WL 5761117 (E.D. La. Sept. 28, 2020), have concluded plaintiffs cannot—reasoning that the TCPA was void while an unconstitutional provision was part of it. As covered in our prior posts, district courts have come down on both sides of the issue—leading to significant confusion.
Enter the Sixth Circuit’s decision in Lindenbaum v. Realgy, LLC, No. 20-4252, 2021 WL 4097320 (6th Cir. Sept. 9, 2021), which considered the Chief Judge of the Northern District of Ohio’s decision that dismissed a putative class action arising from prerecorded calls.
After adopting orders reflecting the majority of implementation deadlines set by the TRACED Act and the Supreme Court’s highly anticipated TCPA decision interpreting the statutory definition of automatic telephone dialing system in the first half of 2021, all eyes are on what the FCC has planned. Midsummer seems like a good time for a year-to-date review to track where the FCC has been and where it is headed next in its TCPA oversight and enforcement roles.
STIR/SHAKEN Call Authentication Framework
Last week, the FCC adopted its January 2021 proposal and issued a Report and Order establishing what the FCC describes as “a fair and consistent process” that a voice service provider can use to challenge a decision by the STIR/SHAKEN framework Governance Authority to strip that provider of the “digital token” that authenticates calls on that provider’s Internet-Protocol (IP) networks.