In April 2021, the United States Supreme Court issued an opinion resolving a long-standing circuit split on the definition of an automatic telephone dialing system.  Such a system, also known as an ATDS or autodialer, has been a point of dispute under the Telephone Consumer Protection Act (TCPA). Generally, the TCPA prohibits the use of any such systems from automating phone calls to cell phone owners without their consent. The decision in the case of Facebook, Inc. v. Duguid, et al, however, adopts a narrow definition of an autodialer. This decision also effectively broadens permissions for a company to call, text, or otherwise communicate with consumers.

The Initial Case Against Facebook

This lawsuit began when plaintiff Noah Duguid sued Facebook after receiving login notification text messages concerning a non-existent Facebook account. On behalf of two putative classes, Duguid alleged that Facebook used autodialers to contact users and other numbers in their system. This contact occurred even if those numbers did not belong to Facebook users.

The U.S. District Court for the Northern District of California dismissed the claims. The court found that the plaintiff failed to show Facebook used a prohibited automatic telephone dialing system. Specifically, the system in question did not randomly or sequentially generate phone numbers as required by the TCPA.

The Ninth Circuit reversed the lower court’s decision. It determined that a system only needs to have the capacity to store and dial numbers. The court clarified that an ATDS classification did not require a random or sequential number generator.

The Case Moves to the Supreme Court

The case next moved before the United States Supreme Court. The parties asked the court to define an autodialer under the TCPA. Specifically, the court was tasked with determining if an autodialer, by definition, must store and dial numbers automatically using a random or sequential number generator.

In a reversal of the Ninth Circuit’s decision, the Supreme Court ruled that an autodialer, as prohibited under the TCPA, must have the capacity to either store or produce a telephone number using a random number generator. The 9-0 decision hinged, in part, on a technical reading of the clauses of § 277(a)(1)(A) of the TCPA.  This review determined that the TCPA’s autodialer definition excludes equipment that does not use a random or sequential number generator.

As the court explains: “Congress found autodialer technology harmful because autodialers can dial emergency lines randomly or tie up all of the sequentially numbered phone lines at a single entity.  Facebook’s interpretation of §227(a)(1)(A) better matches the scope of the TCPA to these specific concerns.  Duguid’s interpretation, on the other hand, would encompass any equipment that stores and dials telephone numbers.”

Specifically, such an interpretation could “capture virtually all modern cell phones,” which have the capacity to store and dial phone numbers,” while also exposing ordinary citizens to TCPA’s liability provisions “in the course of commonplace usage.” However, since it did not utilize random or sequential number generators, Facebook’s messaging system is excluded from the TCPA’s autodialer provision.

What’s Next for Automatic Telephone Dialing Systems?

The Supreme Court’s Facebook ruling will certainly have widespread implications for businesses. This is particularly true for social media platforms that have the capacity to store large swathes of phone data. The most immediate consequence will likely be a quell in lawsuits against Facebook for its use of user’s phone numbers. This is due to the court’s ruling that impermissible communications require random or sequential number generation. Further, this is a system that Facebook does not use. That being said, although the Supreme Court decision has given some much-needed guidance on permissible (and impermissible) types of dialing systems, there are likely other questions to come.

Ability to Store or Dial Numbers

Firstly, the decision doesn’t clarify whether a random or sequential number generator must be actually used to store or dial numbers. It’s unknown whether a system can be prohibited if it only has the capacity to do so. Since Facebook’s login notification system didn’t qualify as such a system, the court did not need to address this question.

Storage vs. Dialing

Secondly, the question of storage versus actual dialing may come into play when defining an ATDS. In this case, the court gave the example of an autodialer which “might use a random number generator to determine the order in which to pick phone numbers from a preproduced list. It would then store those numbers to be dialed at a later time.” In such cases, the storing and producing functions “often merge.”

Other Auto Communications

Thirdly, the Supreme Court’s decision does not affect a number of communication methods, such as automatic text messages that come from ordinary cell phone use (i.e., “Do Not Disturb” messages), or automated calling using artificial voices or prerecorded voice messages. The latter, however, has its own governing rules of compliance. The decision also does not give free rein to unsolicited calls placed on Do Not Call lists. Like artificial voices, this also has its own compliance and regulatory rules to follow.

TCPA Revisions to Come

Lastly, the Supreme Court (perhaps purposely so) doesn’t make a broad finding concerning other technology that could be an ATDS.  This includes both current and future modes of communication. Remember, the TCPA passed in 1991. Thus, it’s likely that the interpretation of these statutes will need to be revisited with advances in technology.

 

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