Back in ancient times when telephones were tethered to cords and houses, Congress passed the Telephone Consumer Protection Act of 1991 (TCPA) to restrict abusive telemarketing practices. Of course, over the past 30 years, telephone technology has evolved, and your smartphone looks nothing like those ancient relics from the ’90s. But, the language of the TCPA hasn’t kept pace. Consequently, courts have had to ‘retro-fit’ modern technology to a statute conceived before the first text message was sent (which was in late 1992—it said “merry Christmas”). For those of you who follow our Sirote Consumer Finance Report, you know we have spilled a lot of digital ink covering interpretations of the TCPA. Fortunately, Facebook to the rescue!

Earlier this month, in Facebook, Inc. v. Duguid, the U.S. Supreme Court further clarified the key TCPA definition of “automatic telephone dialing system” (ATDS). The TCPA prohibits certain unsolicited calls and text messages, including calls and text messages to cell phones, made or sent using an ATDS. Under 7 U.S.C. §227(a)(1), an ATDS is defined as equipment with capacity to “(A) [S]tore or produce telephone numbers to be called, using a random or sequential number generator; and (B) to dial such numbers.”

In 2014, Noah Duguid received several text messages from Facebook stating that someone had attempted to access the Facebook account associated with his phone number. However, Duguid did not have a Facebook account. He brought a class action lawsuit against Facebook claiming a TCPA violation on the basis that Facebook used an ATDS by maintaining a database that stored numbers and automatically sent text messages. However, Facebook argued that its equipment did not meet the definition of ATDS because the numbers were not randomly or sequentially generated. 

The Supreme Court granted certiorari to resolve a Court of Appeals split as to whether an ATDS must have the capacity to generate random or sequential phone numbers. In the opinion authored by Justice Sotomayor released on April 1, 2021, the Court ruled in favor of Facebook since its system “neither stores nor produces numbers ‘using a random or sequential number generator.’” Looking at the language in the statute and the statutory context, the Court concluded an ATDS must have “the capacity to use a random or sequential number generator to either store or produce phone numbers to be called.”

So, why is this an important decision? The definition of ATDS has been a moving target among the courts. While some courts have taken a very broad interpretation that could arguably cover any computer or smartphone, this case will provide some much-needed clarity that will hopefully lead to more consistency in the interpretation. 

Practice Pointer # 1:This case is also a good reminder that the technology originally governed by the TCPA may be ancient, but the law is still relevant and applicable to our 21^st Century technology. 

Practice Pointer # 2:Also, keep in mind, while this case addressed one element of the TCPA, there are other key provisions of the law, so make sure your business has good compliance policies when it comes to contacting consumers, especially by text message or cell phone.