Under the TCPA and the FCC’s implementing regulations, all non-emergency calls – which include text messages under the TCPA – placed via automated telephone dialing systems (“ATDS” or “autodialer”) require some form of consent if placed to a wireless telephone number, with the form of consent dependent on the nature of the call. Specifically, the TCPA provides in relevant part:
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The TCPA is primarily enforced through a private right of action enabled by the statute itself – 47 U.S.C. 227(b)(3). This provision of the TCPA permits any claimant who has received an allegedly autodialed call or text message to their cell phone without the requisite consent to file suit in state or federal court. Id. The TCPA provides for statutory damages of $500 per violation – meaning every call or text message sent in violation of the statute entitles the plaintiff to a separate award of $500 – and a court can award treble damages if “the court finds that the defendant willfully or knowingly violated this subsection or the regulations prescribed under this subsection.” Id. at 227(c)(3)(C). Further, such cases are often brought as class actions, particularly in the case of mass texting campaigns, because the perceived commonality and typicality shared by the putative class, along with uncapped statutory damages permitted by the TCPA. That is, a company that that initiates 10,000 text messages to its customer base would potentially face between a $5 million to $15 million judgment simply by the mathematical application of the statute, and the prospect of such large statutory damages certainly attracts less than meritorious lawsuits by the plaintiffs’ bar to extract in terrorem settlements.
As noted above, the TCPA makes it unlawful to (1) initiate (2) an autodialed text message (or call) to a wireless telephone number (3) without the recipient’s prior express consent. Stated differently, non-autodialed informational text messages fall outside the TCPA completely, even when sent without consent. It is therefore critical to understand what is – and what is not – an autodialer, and the pronounced circuit split that was finally resolved by the Supreme Court through its April 2021 Facebook decision, Facebook, Inc. v. Duguid, 141 S. Ct. 1163 (2021).
The TCPA itself defines an ATDS as “equipment which has the capacity -- (A) to store or produce telephone numbers to be called, using a random or sequential number generator; and (B) to dial such numbers.” A very pronounced circuit split developed concerning the interpretation of this definition, and the crux of the split was based on what the phrase “using a random or sequential number generator” modifies in the preceding clause. That is, in several circuit courts, and consistent with normal rules of grammar, “using a random or sequential number generator” modifies both “store” and “produce” – meaning that if a system does not have the ability to randomly or sequentially generate telephone numbers to be called either immediately or at a later time, the system would not be an autodialer See, e.g., Gadelhak v. AT&T Services, Inc., 2020 WL 808270 (7th Cir. Feb. 19, 2020) (dialing system must store or produce “numbers using a random or sequential number generator” to be an autodialer); Glasser v. Hilton Grand Vacations Co., LLC, No. 18-14499, 2020 WL 415811 (11th Cir. Jan. 27, 2020) (dialing system not an autodialer unless it can randomly or sequentially generate numbers); Dominguez v. Yahoo, Inc., 894 F.3d 116, 121 (3rd Cir. 2018) (same).
In contrast to this approach, other courts looked beyond the statutory definition of what constitutes an autodialer, and analyzed whether the texting platform could be used to send text messages without human intervention, i.e., “automatically.” See, e.g., Marks v. Crunch San Diego, LLC, 904 F.3d 1041, 1053 (9th Cir. 2018) (rewriting statute to interpret autodialer to mean “equipment which has the capacity—(1) to store numbers to be called or (2) to produce numbers to be called, using a random or sequential number generator—and to dial such numbers automatically (even if the system must be turned on or triggered by a person)”) (emphasis added). Or as one court recently framed the test under Marks, a system as a whole must be “incapable of ‘non-manual’ dialing,” such as by only having the capacity to initiate messages individually through click-to-call/message functionality. Meier v. Allied Interstate, LLC, No. 18-CV-1562-GPC-BGS, 2020 WL 819014, at *6 (S.D. Cal. Feb. 19, 2020).
Against this backdrop, the Supreme Court resolved the circuit split – in an unanimous 9-0 decision – by overturning the Ninth Circuit’s expansive interpretation of what constitutes an autodialer stemming from the Marks precedent. Like the Seventh, Eleventh, and Third Circuits before it, the Supreme Court specifically held that to qualify as an autodialer within meaning of TCPA, a device must have the capacity either (1) to store a telephone number using a random or sequential generator or (2) to produce a telephone number using a random or sequential number generator. That is, “using a random or sequential number generator” modifies both “store” and “produce.” The Supreme Court also rejected the plaintiff’s appeal that its decision would usher in a flood of unsolicited texts by not allowing the lower courts to interpret the definition along with changes in technology, ruling that the plaintiff’s “quarrel is with Congress, which did not define an autodialer as malleably as he would have liked. … This Court must interpret what Congress wrote.”
At bottom, the Supreme Court’s ruling should greatly reduce the litigation exposure to companies or organizations using texting platforms to communicate with large numbers of consumers. In practice, almost no modern dialing equipment or text messaging platform has the present capability to generate telephone numbers, randomly, sequentially, or otherwise. Instead, nearly all modern calling/texting platforms rely on the user to import a curated list of telephone numbers, such as from the company’s CRM database or even third-party lists. Folkerts v. Seterus, Inc., CIV No. 17-C-4171, 2019 WL 1227790, at *6 (N.D. Ill. Mar. 15, 2019) (“equipment that merely has the ability to dial numbers from a stored list, as opposed to producing numbers using a random or sequential number generator, does not qualify as an ATDS”). Thus, under this interpretation, even text messages sent automatically, and in bulk, would not be considered autodialed under the TCPA where the texting platform cannot separately generate telephone numbers to be messaged.