Message Received: Supreme Court Narrowly Construes Autodialer Definition

On April 1, the Supreme Court issued a 9-0 unanimous decision authored by Justice Sotomayor (with Justice Alito writing a concurring opinion) in Facebook, Inc. v. Duguid, resolving the circuit split on what constitutes a prohibited “automatic telephone dialing system” (more often referred to as an “autodialer” or “ATDS”) and adopting a narrow definition of ATDS. Yesterday’s ruling likely provides welcome relief to those subject to the TCPA—at least for the time being. More on that below.

Specifically, the Court favored the Third, Seventh, and Eleventh Circuits’ autodialer definitions and held that, in order to be an ATDS, “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 a random or sequential number generator.” In other words, a telephone number must essentially be pulled out of thin air and then called or texted; that is what “random or sequential” number generation means. That type of technology was commonly used in the early 1990s when the TCPA was enacted, but virtually no one uses it anymore. Now, companies typically dial from stored lists of specific telephone numbers. The Supreme Court’s concern was that, if it accepted the alternative ATDS definition—that dialing from a cultivated list of telephone numbers constitutes autodialing—such interpretation “would capture virtually all modern cell phones . . . The TCPA’s liability provisions, then, could affect ordinary cell phone owners in the course of commonplace usage, such as speed dialing or sending automated text message responses.” Notably, during oral argument last December, Justice Sotomayor foreshadowed her and the other justices’ doubts in questioning to Bryan Garner, Duguid’s counsel:

[I]f we rule your way, the logical consequence is that every cell phone owner would be subject to the harsh criminal and civil penalties of the TCPA. Could you give me a reason, other than that it hasn’t happened yet, for—for why Congress would have intended that? . . . And, by the way, it seems—don’t—please don’t answer by saying it hasn’t happened yet, and the reason I say that is because, if you get a ruling in your favor, I know for sure that there will be lawsuits against individuals that will follow.

(As a sidebar, it bears noting that Garner often wrote articles and wrote a book about statutory interpretation with the late Justice Antonin Scalia. Those same books and articles made their way into the Supreme Court’s decision as support for why Duguid’s arguments fell flat.)

Notably, the Court was largely silent on the “human intervention” test that lower courts frequently have adopted, i.e., that human involvement takes a dialing platform out of the ATDS definition. In a footnote, the Court explained that, since “all devices require some human intervention,” it “require[es] such a difficult line-drawing exercise around how much automation is too much.” This appears to refocus future ATDS inquiries on whether dialing systems have the capacity to store numbers randomly or sequentially or produce numbers randomly or sequentially. Given that the Court did not go so far as to define the contours of “capacity,” that question will be up to lower courts to decide (for now).

The Court’s closing statement that “Duguid’s quarrel is with Congress, which did not define an autodialer as malleably as he would have liked[,]” leads one to query whether a congressional change is likely. This would require Congress to adopt the more expansive autodialer definition that had been favored by the Second, Sixth, and Ninth Circuits but was rejected by the Supreme Court—dialing from a stored list of phone numbers, regardless of how that list is created, without sufficient human involvement constitutes autodialing under the statute. It is also unclear whether and to what extent such amendment would have a retroactive effect. Already, in response to yesterday’s Supreme Court ruling, Senator Markey (D-MA) and Congresswoman Eshoo (D-CA) issued a joint statement:

Today, the Supreme Court tossed aside years of precedent, clear legislative history, and essential consumer protection to issue a ruling that is disastrous for everyone who has a mobile phone in the United States. It was clear when the TCPA was introduced that Congress wanted to ban dialing from a database. By narrowing the scope of the TCPA, the Court is allowing companies the ability to assault the public with a non-stop wave of unwanted calls and texts, around the clock.

Fortunately, we can and will act to make right what the Supreme Court got wrong. We plan to soon introduce legislation to amend the TCPA, fix the Court’s error, and protect consumers. If the Justices find their private mobile phones ringing non-stop from now until our legislation becomes law, they’ll only have themselves to blame.

Despite the ruling, those subject to the TCPA should still ensure they are meeting the consent requirements for prior express written consent in order to avoid the autodialer issue altogether. Venable has the experience needed to help clients navigate TCPA issues. We will continue to monitor what lies ahead in the wake of Facebook, Inc. v. Duguid.