For years, courts, litigants, and commentators have grappled with the TCPA’s definition of “automatic telephone dialing system” (“ATDS”). As a result of the FCC’s July 2015 Declaratory Ruling and Order, the debate has focused on the question of capacity, i.e., whether a device must have the present capacity to “(a) store or produce telephone numbers to be called, using a random or sequential number generator; and (b) to dial such numbers” or—as the FCC found—if the potential capacity is sufficient.
The debate continues, as illustrated by a recent decision in the Northern District of California. In Brickman v. Facebook, Inc., No. 16-cv-00751-TEH, 2017 U.S. Dist. LEXIS 64343 (N.D. Cal. Apr. 27, 2017), the plaintiff alleged receipt of an unsolicited text message announcing a Facebook friend’s birthday. Id. at *1. He claimed he had indicated in the settings for his account that he did not want to receive any text messages from the company. Facebook moved to dismiss, arguing plaintiff had not sufficiently alleged a TCPA violation because the text at issue suggested “direct targeting following human intervention.” Id. The court found plaintiff’s allegations sufficient and denied the motion (which we covered here)
Three months later, however, the Brickman court certified its ruling for interlocutory appeal. The court explained that “substantial grounds for disagreement” existed as to whether its prior ruling on the ATDS issue presented a correct pronouncement of the law. See id. at *9. The Brickman court also ruled that if the Ninth Circuit did not accept the case, it would be stayed pending a decision by the D.C. Circuit in the closely-watched consolidated appeal in ACA International v. FCC, No. 15-1211 (D.C. Cir. filed Nov. 25, 2015).
Although the Ninth Circuit has yet to decide whether to accept the Brickman appeal, it recently issued an unpublished decision on this issue. See Flores v. Adir Int’l, LLC, No. 15-56260, 2017 U.S. App. LEXIS 5228 (9th Cir. Mar. 24, 2017). In Flores, the district court had dismissed the case on grounds that the ATDS allegations were insufficient because they suggested “direct targeting that is inconsistent with the sort of random or sequential number generations required for an ATDS.” But the Ninth Circuit disagreed, holding that the plaintiff’s ATDS allegations were sufficient to state a TCPA claim because “it is reasonable to infer that the equipment [Adir used] has the capacity to store or produce telephone numbers to be called, using a random or sequential number generator, even if it was not presently being used for that purpose.” Id. at *3 (internal quotation marks and citations omitted) (emphasis and alteration in original).
Notwithstanding Flores, there are substantial grounds for staying actions presenting the capacity issue. For example, in a recent Ninth Circuit case, the court heard oral argument concerning the ATDS definition. See Marks v. Crunch of San Diego, No. 14-56834 (9th Cir. filed Nov. 21, 2014). Just days later, the court sua sponte vacated and deferred the case pending a decision by the D.C. Circuit in ACA Int’l. See id., Dkt. No. 62.
With the interpretation of “capacity” as a potentially dispositive issue, the importance of awaiting the D.C. Circuit’s ruling in ACA Int’l remains unquestioned. Only after the questions in ACA Int’l are resolved with finality will there be a hope for clarity on this key issue of TCPA jurisprudence.
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