On Thursday, the United States Supreme Court agreed to review the question of what type of dialing equipment qualifies as an “automatic telephone dialing system” (ATDS) under the Telephone Consumer Protection Act (TCPA). The Court’s review arises from a challenge to the Ninth Circuit’s broad definition of ATDS. The plain language of the TCPA states that an ATDS is “equipment which has the capacity to store or produce telephone numbers to be called, using a random or sequential number generator; and to dial such numbers.” 47 U.S.C. § 227(a)(1). Since the D.C. Circuit abrogated the Federal Communications Commission (FCC) rulings construing that language, see ACA International v. FCC, 885 F.3d 687, 701 (D.C. Cir. 2018), a split has emerged among the federal circuit courts that have examined the definition. The Ninth and Second Circuits have held that a dialing system need only have the capacity to “store numbers to be called” and “to dial such numbers automatically” to constitute an ATDS. See Duran v. La Boom Disco, Inc., 955 F.3d 279, 283-84 (2d Cir. 2020); Marks v. Crunch San Diego, LLC, 904 F.3d 1041, 1052-53 (9th Cir. 2018). The Third, Seventh, and Eleventh Circuits, on the other hand, have reined in the definition of ATDS. These courts have held that a system cannot constitute an ATDS where it lacks the capacity either to (1) store telephone numbers to be called using a random or sequential number generator, or (2) produce telephone numbers to be called using a random or sequential number generator. See Gadelhak v. AT&T Servs., Inc., 950 F.3d 458, 464, 469 (7th Cir. 2020); Glasser v. Hilton Grand Vacations Co., 948 F.3d 1301, 1310 (11th Cir. 2020); Dominguez v. Yahoo, Inc., 894 F.3d 116, 119-21 (3d Cir. 2018).Read More
The Federal Communications Commission (FCC) recently issued a declaratory ruling on a petition seeking clarification of the definition of an “automatic telephone dialing system” (ATDS) under the Telephone Consumer Protection Act (TCPA), 47 U.S.C. § 227. In its order, the FCC ruled that a text messaging platform that requires a person to actively and manually dial a recipient’s number and transmit those messages, and that lacks the capacity to transmit more than one message without a person manually dialing each number, is not an ATDS under the TCPA. The FCC concluded such a system does not meet the definition of ATDS because it does not store or produce numbers to be called using a random or sequential number generator and dial such numbers automatically. See FCC Order ¶¶ 3, 8–12. Although not expressly stated, the FCC ruling is consistent with prior decisions of the Third, Seventh, and Eleventh Circuit Courts of Appeals, discussed here, specifically in that curating a list of numbers, and then dialing the numbers from that list, is not sufficient to establish the use of an ATDS under the TCPA. The FCC order may present businesses facing TCPA lawsuits with another basis to challenge the Ninth and Second Circuit Courts of Appeals’ decisions that construed the definition of ATDS more broadly than Third, Seventh, and Eleventh Circuit’s definition.
The Seventh Circuit recently acted to limit the definition of “automatic telephone dialing system” (“ATDS”) under the Telephone Consumer Protection Act (“TCPA”). In Gadelhak v. AT&T Services, Inc.,  the court ruled that a dialing system that “neither stores nor produces numbers using a random or sequential number generator,” but rather “exclusively dials numbers stored in a customer database,” “is not an ‘automatic telephone dialing system’ as defined by the Act.” In construing the definition of ATDS narrowly, the Seventh Circuit joined the interpretation adopted by the Third and Eleventh Circuits and rejected the Ninth Circuit’s differing interpretation.Read More