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SCOTUS Issues Long-Awaited TCPA Ruling Narrowing The Definition Of An Autodialer



On April 1, the Supreme Court issued its highly anticipated ruling in Facebook v. Duguid, which limited what qualifies as an automatic telephone dialing system (ATDS) under the federal Telephone Consumer Protection Act (TCPA). The Court unanimously held that Facebook’s method of sending security texts to users did not meet the TCPA’s definition of an ATDS.

The Court’s decision, based on a strict reading of the TCPA text, substantially narrows the definition of an ATDS that was adopted by the Ninth Circuit. This should reduce the litigation risk for many businesses that engage in text marketing campaigns. It does not, however, mean a texting free-for-all, as there are still important restrictions and considerations regarding text marketing without consent.

The Court Held That Facebook Did Not Use An ATDS To Send Texts

Facebook allows users to elect to receive a text when someone attempts to log into the user’s account from an unauthorized device or browser. Facebook sent a number of these security texts to Noah Duguid, even though Duguid was not a Facebook user and he did not consent to receiving such texts. Duguid sued Facebook under the TCPA, alleging that Facebook used an ATDS to send him the text messages.

The Court had to decide whether Facebook’s method of texting met the TCPA’s definition of an ATDS, which is a device that has the “capacity” both “to store or produce telephone numbers to be called, using a random or sequential number generator,” and to dial those numbers. 47 U. S. C. §227(a)(1). The Court held that Facebook was not using an ATDS because “Facebook’s notification system neither stores nor produces numbers using a random or sequential number generator.” Facebook did not generate Duguid’s number randomly or sequentially.

The Court rejected Duguid’s expansive definition of an ATDS to cover “any equipment that merely stores and dials telephone numbers” . . . which would “capture virtually all modern cell phones, which have the capacity to store . . . telephone numbers to be called” and “dial such numbers.” §227(a)(1). Under this interpretation, “[t]he TCPA’s liability provisions . . . could affect ordinary cell phone owners in the course of commonplace usage, such as speed dialing or sending automated text message responses.

What You Should Do Now

Most text marketing campaigns likely do not use random or sequential numbers and thus do not use an ATDS under the Court’s definition. While businesses may want to start ramping up their text marketing campaigns based on the Court’s new ruling, they shouldn’t press “send” just yet.

The plaintiff’s bar is already prepared to argue the perceived gaps in the ruling, likely focusing on what “capacity” means. There is an entire industry based on bringing forth these lawsuits, and it is a good idea to err on the side of caution until we see how some of this shakes out. We recommend the following best practices and considerations at this time:

  • The gold standard remains that you should obtain prior express written consent before sending marketing texts. If you are faced with a lawsuit for sending marketing text messages, a record of a customer’s prior express written consent should shield you from liability. And you can avoid the debate over whether your texting technology is an ATDS under the Court’s definition.
  • Remember that you still can’t send marketing texts to someone on the federal Do Not Call list or on a state do not call list without obtaining their advance consent, which is sometimes required to be in writing. Also, some states prohibit commercial texts without consent even if there is no ATDS used. Washington State’s Commercial Electronic Mail Act requires that a subscriber “has clearly and affirmatively consented” before a business can send them commercial text messages using an ATDS or not.
  • Remain knowledgeable of additional TCPA requirements to avoid liability, such as maintaining your own internal do not call list.
  • Despite these caveats, now is the time to take a close look at the technology you use to send marketing texts to see if it meets the Court’s definition of an ATDS.
  • Stay on top of changes in the law. Justice Sotomayor made clear in the opinion that the plaintiff’s “quarrel [was] with Congress, which did not define an autodialer as malleably as he would have liked.” Congress is already under pressure to expand the TCPA in response to the Facebook decision, and the TCPA is only going to get more restrictive if Congress chooses to amend it. Companies should continue obtaining the heightened level of consent if they want any chance of using their current contact list in the future for text marketing campaigns.

The Facebook decision is good news, and it should mean reduced risk for text marketers. But it does not mean that anything goes. The best way to proceed is to keep these considerations in mind before engaging in a text marketing campaign.