Three months after the Supreme Court’s landmark Facebook ruling, a growing number of trial courts have grappled with interpreting and applying the High Court’s directive. One of the more interesting decisions came out of the Eastern District of Michigan recently. In Barry v. Ally Fin., Inc., No. 20-cv-12378, 2021 WL 2936636, at *1-7 (E.D. Mich. July 13, 2021), the district court dismissed a putative TCPA class action on the grounds that the plaintiff failed to allege use of an ATDS. More significantly, the district court interpreted Facebook to hold that to be an ATDS, the dialing system must actually use a random or sequential number generator to call the plaintiff, and not merely have the capacity to do so.
Category - "Automatic Telephone Dialing System"
Facebook Decision Upends TCPA Litigation Landscape
TCPA Blog’s Mike Daly co-authored an article for the ABA about the impact of the Supreme Court’s recent ruling in Facebook, Inc. v. Duguid, which clarifies the TCPA’s definition of an ATDS. The article explains that the unanimous decision is a victory for businesses because it limits the scope of the statute’s restriction on autodialing and because it should drastically decrease the volume of litigation arising under that part of the statute, which has been one of the most active areas of litigation in recent years. But the article also predicted that the ruling may cause plaintiffs’ counsel to focus on other calling restrictions, for example its restrictions on artificial or prerecorded voices, Do-Not-Call restrictions, and even faxes.
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Eastern District of Pennsylvania Court Holds Text Claim Satisfies Article III, Then Dismisses for Failure to Allege Enough Facts to Make Claim Plausible
A judge in the U.S. District Court for the Eastern District of Pennsylvania recently concluded that receipt of unwanted text messages in violation of the TCPA can constitute an injury-in-fact for purposes of Article III standing, but nevertheless dismissed the claim (without prejudice) pursuant to Rule 12(b)(6) based on its threadbare allegations.
In Camunas v. National Republican Senatorial Committee, the plaintiff (Rolando Camunas) alleged that he received no less than six unsolicited text messages from the defendant (NRSC) asking him to donate to a political party. Civil Action No. 21-1005, 2021 WL 2144671, at *1 (E.D. Pa. May 26, 2021). In his complaint, Camunas described the messages as “generic and obviously pre-written” and alleged that they were sent using an automatic telephone dialing system (ATDS), in violation of the TCPA. Id.
Supreme Court’s Facebook Decision Upends TCPA Litigation Landscape
TCPA Blog’s Michael Daly will be participating in a webinar titled “Supreme Court’s Facebook Decision Upends TCPA Litigation Landscape.” This webinar on Thursday, April 22, 2021, will delve into the Supreme Court’s decision in Facebook v. Duguid, which resolved a split among the lower courts over how to interpret the TCPA’s definition of an “automatic telephone dialing system.” The panelists from the Consumer Litigation Committee of the American Bar Association’s Litigation Section will analyze the decision and discuss the future of TCPA litigation.
For more information and to register, please click here.
Supreme Court Adopts Narrow Autodialer Definition
In a decision issued this morning, the Supreme Court settled a long-running debate over the scope of the TCPA’s “automatic telephone dialing system” definition: “whether that definition encompasses equipment that can ‘store’ and dial telephone numbers, even if the device does not ‘us[e] a random or sequential number generator.” Facebook, Inc. v. Duguid, 592 U.S. — (2021).
The Court unequivocally held that devices that merely store numbers from a premade list do not qualify as autodialer systems subject to the TCPA. “To qualify as an [ATDS],” explained Justice Sotomayor, writing for Court, “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 either form of generation. Id. at 1.
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Southern District of California Dismisses TCPA Claim Due to Speculative ATDS Allegations
The Southern District of California recently dismissed the TCPA case Hildre v. Heavy Hammer, Inc., No. 3:20-cv-00236, 2021 WL 734431 (S.D. Cal. Feb. 25, 2021), for the plaintiff’s failure to adequately allege that the defendants had used an automatic telephone dialing system (“ATDS”) when placing calls.
The plaintiff alleged that the defendants called him using an ATDS without first obtaining his consent. Specifically, he claimed that the out-of-state defendant called him twice using a California telephone number. After the first call, plaintiff claimed that he asked to be removed from the call list. When plaintiff received the second call, he alleges that there was a “noticeable pause” after he answered.
Seventh Circuit Reaffirms Gadelhak, Rejects Challenge to Narrow ATDS Definition
The Seventh Circuit last week affirmed its holding in Gadelhak v. AT&T Services, Inc., 950 F.3d 458 (7th Cir. 2020) that, to qualify as an “automatic telephone dialing system” (ATDS) under the TCPA, a device or calling system must have the ability to randomly or sequentially generate the phone numbers that it calls. As we reported here and here, this interpretation of the statute’s ATDS definition excludes systems and devices that place calls from a premade list of numbers, such as a list of customers’ mobile numbers. Courts remain divided on how to interpret the ATDS definition and the Supreme Court is expected to address the issue in a case that is currently before it, Facebook, Inc. v. Duguid.
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Senescence and Sensibility: Will the Supreme Court Mothball the TCPA?
TCPA Blog’s Mike Daly authored an article for the American Bar Association’s Consumer Litigation Committee titled, “Senescence and Sensibility: Will the Supreme Court Mothball the TCPA?” that discusses developments around TCPA’s autodialer restriction. The article addresses the dispute between courts over what qualifies as an ATDS and the impact the dispute has had on businesses trying to comply with the statue when its scope varies between circuit courts. The article also highlights how what constitutes an ATDS may finally be resolved in Facebook v. Duguid and what the case’s decision could mean for pending cases.
The full article is available for American Bar Association’s Consumer Litigation Committee subscribers.
District Court Dismisses Ex-Attorney and TCPA Serial Litigant’s Claims with Prejudice
On January 6, 2021, the District of Maryland dismissed a TCPA claim (and a derivative claim under Maryland’s MDTPCA) against Discount Power, Inc. (“Discount”). See Worsham v. Discount Power, Inc., No. 20-0008, 2021 WL 50922 (D. Md. Jan. 6, 2021). The decision is a helpful reminder that a number’s purpose can be a critical component of a TCPA claim and that defendants should therefore develop that fact during preliminary investigation and, if necessary, during formal discovery.
District of Nevada Applies Agency Principles to TCPA Suit Against Messaging Platform and Consumer-Info Company, Dismisses Claims
Last week, the District of Nevada contributed to a growing consensus among Ninth Circuit district courts that TCPA liability generally does not extend to companies that produce equipment used to place unlawful calls—such as messaging platforms and contact lists— because the entities that use such equipment usually do so on behalf of another company, and not the equipment provider.