Today, the United States Supreme Court resolved a circuit split regarding what constitutes an “autodialer” under the Telephone Consumer Protection Act (TCPA). In a blow to the plaintiffs’ bar, the Supreme Court ruled in favor of defendant Facebook, establishing a narrower, nationwide standard for what type of dialing equipment constitutes an “autodialer.”
The TCPA prohibits auto-dialed calls and texts to cellphones without prior express consent. Statutory penalties under the TCPA are severe: $500 per call in violation of the statute, or $1,500 per call for willful violations. 47 U.S.C. § 227(b)(3). The key issue in the Facebook appeal was whether a computer that simply stores and then dials a list of numbers qualifies as an “autodialer,” or whether the “autodialer” must itself randomly generate the list of numbers to be called.
In Facebook, Inc. v. Duguid, et al., No. 19-511, a unanimous Court overturned a Ninth Circuit ruling that held that dialing equipment that dials numbers from a stored list (as opposed to a randomly generated list) can qualify as an autodialer under the TCPA. The high court held, instead, 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.” The Second, Sixth, and Ninth Circuits had previously held that equipment that merely dials numbers from a stored list can qualify as an autodialer under the TCPA.
The TCPA defines “automatic telephone dialing system” as “equipment which has the capacity to store or produce telephone numbers to be called, using a random or sequential number generator, and, to dial such numbers.” 47 U.S.C. § 227(a)(1). In the case below, Duguid filed a putative class action over text messages he received from Facebook in 2014, alleging that Facebook violated the TCPA by sending automated text messages to his cellphone using an autodialer. Facebook argued that the TCPA did not apply, saying the technology it used to send Duguid text messages was not an autodialer because it did not send him text messages using a “random or sequential number generator.” The district court agreed and the plaintiff appealed to the Ninth Circuit, which reversed.
Before the Supreme Court, Facebook argued that the phrase “using a random or sequential number generator” modified both “store” and “produce,” while the plaintiff urged that the phrase only modified “produce,” such that an autodialer would encompass any equipment that can simply store and dial numbers, such as your average smartphone. The Supreme Court held that Facebook’s reading provided the most natural construction and, further, that it more closely aligned with Congress’ intent in enacting the TCPA, which arose–in part–from concerns that autodialers could randomly dial emergency lines, creating a threat to public safety, or “tie up all the lines of any business with sequentially numbered phone lines.”
The Supreme Court also appeared to recognize the potentially crippling effect the plaintiff’s reading would have on businesses that use telemarketing, stating that “[e]xpanding the definition of an autodialer to encompass any equipment that merely stores and dials telephone numbers would take a chainsaw to these nuanced problems when Congress meant to use a scalpel.”
While today’s ruling is a significant victory for the TCPA defense bar, businesses should continue to ensure compliance with the TCPA’s other requirements and prohibitions, including those relating to prerecorded calls.