Refreshing Relief or Return of the Robocalls?
Stites & Harbison Client Alert, April 2, 2021
In a long-awaited decision, the United State Supreme Court issued a ruling in Facebook, Inc. v. Duguid, No. 19-511, on April 1, 2021, concluding that, to qualify as an autodialer under the Telephone Consumer Protection Act (“TCPA”), a device must have the capacity to use a random or sequential number generator to store or to produce phone numbers. In other words, in contrast to what some courts had concluded, it is not enough for the device simply to be able to store and then automatically dial numbers. This decision resolved a Circuit split in interpreting the TCPA and settled a debate among at least four different interpretations of the autodialer definition.
The Facebook case began with a seemingly beneficial act: Facebook sent automated text alerts to Noah Duguid informing him of someone attempting to access his Facebook account using an unknown browser. The problem was that Duguid did not have a Facebook account (it was unclear why Facebook had Duguid’s number, but it was possible that he had the phone number of a prior Facebook user who had opted in to receive text alerts). Whether tired of texts, enticed by the TCPA’s generous damages provision (potentially $1,500 or more per violation), or spurred by some other motive, Duguid sued.
The case turned on the TCPA’s definition of an “automatic telephone dialing system” (an autodialer): equipment that “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.” 47 U.S.C. § 227(a)(1). Prior to Facebook, courts had come up with at least four possible interpretations of this provision, all of which turned on how to apply the phrase “using a random or sequential number generator:” (1) equipment capable of performing at least one of these functions using a random or sequential number generator is an autodialer; (2) only equipment that dials randomly or sequentially generated numbers can be an autodialer; (3) an autodialer is any equipment that can produce numbers randomly or sequentially or equipment that can simply store and dial numbers; and (4) the phrase refers to the manner in which the numbers are to be called, regardless of how numbers are stored, produced, or generated.
In an opinion reminiscent of a grammar lesson (with a concurring opinion by Justice Alito to match), the Supreme Court concluded that the phrase “using a random or sequential number generator” applies both to the words “store” and “produce,” meaning that an autodialer must have the capacity to use a random or sequential number generator to store phone numbers or have the capacity to use a random or sequential number generator to produce phone numbers. Simply having the capacity to store numbers and then to dial them automatically is not enough.
While it remains to be seen if Duguid’s unsuccessful argument that the Court’s ruling will open the floodgates to a new era of unchecked robocalls will prove prophetic, the ruling should improve the ability of businesses using automated processes to communicate with their customers (depending on the nature of the system and compliance with other provisions of the TCPA and other applicable law, of course)…as well as enable a sigh of relief for anyone who owns a smart phone, which, under the broad interpretation previously followed by the Ninth Circuit, just might have been an autodialer.