The Reins Have Loosened Under the TCPA, at Least Temporarily

We have all received them, those unsolicited—and unwanted—calls regarding our supposed student loans, credit card debt, troubles with the IRS, even health insurance opportunities. While the subject matter varies, the calls are a constant, as is the nuisance factor. And that, in a nutshell, is what prompted enactment of the Telephone Consumer Protection Act (TCPA) back in 1991.

The very purposes of the TCPA is (and was) to stop unwanted telemarketing phone calls—and now text messages—to consumers. Toward that end, the law prohibits businesses from contacting cellular telephone numbers using automatic telephone dialing systems (ATDS), unless, of course, recipients have already given their express consent to receive such communications. That being said, an interpretive question at the very heart of liability under the TCPA—and one that should be of great interest to GCs and other stakeholders in any consumer-facing business—is as follows: what exactly qualifies as an ATDS for the purpose of triggering statutory penalties under the law?

Last month, the U.S. Supreme Court provided a straightforward answer to this query in a landmark TCPA case captioned Facebook, Inc. v. Duguid. In short, the Court stated that equipment dialing from a list of numbers cannot be characterized as an ATDS (commonly referred to as an “autodialer”). Instead, to qualify as an autodialer, “a device must have the capacity either to store a telephone number using a random or sequential number generator, or to produce a telephone number using a random or sequential number generator.”

The Facebook Litigation

By way of background, Facebook had sent several login-notification text messages to Noah Duguid alerting him of attempts to access his Facebook account from an unknown browser. However, Duguid did not have a Facebook account, and never gave the social media giant his telephone number. Consequently, he brought a putative class action against Facebook, alleging that its text messages violated the TCPA. Significantly, the litigation was premised upon the claim that Facebook used an autodialer to place the texts at issue.

Facebook vehemently opposed the notion that it used an ATDS, and the Supreme Court agreed. Ultimately, it was determined that Duguid failed to allege that Facebook sent text messages to numbers that were randomly or sequentially generated. Stated another way, Facebook’s notification system did not qualify as an ATDS under the TCPA.

Now What?

With its determination, the Supreme Court left countless parties breathing a collective sigh of relief, as it drastically limits (for now) the instances of TCPA violations. Indeed, the Facebook decision is a decisive victory for companies that use automated equipment to make calls or send text messages to their consumers. And that is because in the wake of the ruling in the Facebook case, unless their dialing equipment uses a random or sequential number generator, businesses will not be required to obtain prior written consent from consumers prior to contacting them.

Note, however, that the TCPA’s prior express consent requirements still prohibit calls using an artificial or prerecorded voice to various types of phone lines, including home and mobile numbers, unless an exception applies.

Waiting for the Other Shoe to Drop

Mere hours after the Facebook opinion was released, the legislative fight to overturn it began. Senator Edward J. Markey (D-Mass.), one of the original authors of the TCPA, joined with Congresswoman Anna G. Eshoo (CA-18), to issue a joint statement calling the Supreme Court’s decision “disastrous for everyone who has a mobile phone in the United States.” In their release, Senator Markey and Congresswoman Eshoo went on to state that “the Court is allowing companies the ability to assault the public with a non-stop wave of unwanted calls and texts, around the clock,” and that the decision, rather than enforcing the TCPA, actually ignores its clear legislative history. According to the legislators, “the TCPA makes it clear that Congress was not only concerned with corporate America randomly generating numbers and calling those numbers, but was also concerned with corporate America buying lists to make telemarketing calls.”

Not surprisingly, the lawmakers gave voice to their intention to “introduce legislation to amend the TCPA, fix the Court’s error, and protect consumers.” As such, it may be a bit premature for businesses to celebrate what seems to be such an enormous win for them. To be sure, even a U.S. Supreme Court decision can be overturned by bipartisan legislation in Congress that is signed into law.

The Takeaway

Given the likelihood of congressional action, there is only one way for companies to be absolutely certain and play it safe when it comes to telephonic outreach to their customers: by being informed and obtaining express written consents after appropriate disclosure, they will never have to worry about the ongoing twists and turns of the TCPA.

This blog post is not offered, and should not be relied on, as legal advice. You should consult an attorney for advice in specific situations.