WASHINGTON – A unanimous panel of the U.S. Supreme Court recently ruled that a 1991 definition of an automatic telephone dialing system did not govern unsolicited text messages social media company Facebook sent to a cell phone number in its database, a ruling that could change the landscape of litigation brought under the Telephone Consumer Protection Act (TCPA).
In an April 1 opinion authored by Justice Sonia Sotomayor in Facebook v. Duguid, the court ruled that to qualify as an “automatic telephone dialing system” under the TCPA, a device must have the ability either to store, or to produce, a given phone number using a random or sequential number generator; marketing technology which is generally no longer used.
The TCPA was passed in 1991 in response to public uproar over unwanted telemarketing calls – the cost of which, at the time, would be charged to their recipients, in the days before telephone plans with unlimited minutes.
The issue that came to bear in Facebook v. Duguid is the portion of the law that prohibits “using any automatic telephone dialing system or an artificial or prerecorded voice” to call or text cell phones, as well as emergency telephone lines, hospital patient rooms, pagers and phones which charge for incoming calls and others.
The Federal Communications Commission, all 50 attorneys general and private parties were authorized to bring legal action against violators of the law, with monetary penalties ranging from $500 to up to $1,500 per call.
Though marketing technology has made quantum leaps and bounds since the passage of the law 30 years ago, the language of the statute has remained the same.
As the TCPA has been interpreted for years, it has given rise to thousands of lawsuits brought by both individual and class action plaintiffs, seeking damages from telemarketing defendants ranging from thousands to millions of dollars.
In many instances, rather than absorb the potentially higher cost of protracted litigation, the defendants would end up settling the cases. The legal fees and court costs incurred in defending a class action through trial can get to around $500,000, a lawyer previously told the Pennsylvania Record, and that's before adding a possibly devastating verdict.
Here, plaintiff Noah Duguid filed suit against Facebook under the TCPA, because he had received several text messages from the social media company alerting him of unauthorized access to his Facebook account – though Duguid never possessed a Facebook account or provided the company with his number.
The text messages in question were sent to Duguid using automated technology, but not the same technology as specified under the TCPA – an “automatic telephone dialing system or an artificial or prerecorded voice” – which stood as the crux of Facebook’s argument, since its messaging technology could not be described that way.
According to the strict interpretation employed by Sotomayor and the rest of the U.S. Supreme Court, the TCPA does not ban equipment like that used by Facebook.
Rather, the nation’s high court reasoned in a narrow construction that a number generator is a necessary component for marketing equipment to qualify as an autodialer under the TCPA, as written.
“Expanding the definition of an autodialer to encompass any equipment that merely stores and dials telephone numbers would take a chainsaw to these nuanced problems when Congress meant to use a scalpel. Duguid’s interpretation of an autodialer would capture virtually all modern cell phones, which have the capacity to ‘store…telephone numbers to be called’ and ‘dial such numbers,” Sotomayor said.
Kevin P. Allen, an attorney with the law firm of Eckert Seamans - which has offices in Pittsburgh, Philadelphia and Harrisburg - called the ruling a “long-awaited” one, which would have had tremendous import and impact no matter which way it went.
“Legitimate companies like Facebook, in this case, or no self-respecting marketing company that they hire wants telemarketers to place calls randomly or sequentially [as was the case when the TCPA was first enacted]. To engage in effective telemarketing, a company wants calls placed very specifically. They want to place targeted calls, either to customer lists or to specific targets. And there’s no way that anyone now wants any calls to be made randomly or sequentially,” Allen said.
“But through the years since the TCPA was adopted, the statute hasn’t changed in any relevant way. But the regulatory agency who oversees the TCPA, the FCC, continued to engage in, essentially, regulatory amendments to this statute. And so, multiple courts had held that so long as the calls were made without human intervention, in other words, if they were automatically dialed, it could create liability.”
Allen explained that the court's reasoning is that the U.S. Congress is free to pass legislation banning the types of messages Duguid received in this case, but it has not done so yet, and as it is written, the TCPA cannot be used to seek relief for them.
“It doesn’t do away with the TCPA entirely, because there are different types of calls that could trigger liability, but this does away with a form of TCPA claim that was significant. It will get rid of any current claims, and it will prevent many future claims from ever being filed. It was a decided win for TCPA defendants,” Allen said.
U.S. Supreme Court case 19-511
From the Pennsylvania Record: Reach Courts Reporter Nicholas Malfitano at nick.malfitano@therecordinc.com