Last week, the U.S. Supreme Court ruled unanimously in favor of the petitioner, a large social networking company, resolving the ongoing circuit split over the definition of an automatic telephone dialing system (ATDS) under the Telephone Consumer Protection Act (TCPA). The Court held that a device must “have the capacity either to store, or to produce, a telephone number using a random or sequential number generator — a type of obsolescent marketing technology” to qualify as an ATDS.
The plaintiff in the case originally sued the social networking company after receiving multiple text messages regarding the security of his account. The plaintiff did not have an account and never provided his number to the company. In the district court, the company successfully disputed the allegation, clarifying that it did not use an ATDS because its technology did not have the capacity to dial random or sequential numbers. The Ninth Circuit reversed the district court’s dismissal of the case, relying on its previous adoption of a broad definition of “autodialer” to determine that a device meets the definition of an ATDS if the device stores numbers and dials them automatically.
Prior to the Court’s recent decision, two approaches existed to reading the TCPA’s definition of an ATDS. The Second, Sixth and Ninth Circuits took the expansive approach to this definition as referenced earlier, each ruling in separate cases that a device that dials from a stored list of numbers can be an ATDS, regardless of how those numbers are generated. Alternatively, the Third, Seventh, and Eleventh Circuits adopted a narrower reading of the TCPA’s definition of an ATDS, finding that only devices that produce or store the numbers using a random or sequential number generator meet the definition of an ATDS.
Justice Sotomayor penned the Court’s opinion reversing the Ninth Circuit’s ruling, concluding that the Act requires an ATDS to utilize a “random or sequential number generator[s]” to place calls. The Court reached this conclusion by applying “conventional rules of grammar” to the definition and by considering the statutory context. The Court looked to the purpose of the TCPA in making it unlawful to use an ATDS to call certain types of numbers and tie up two or more lines of a multi-line business, and determined that to accept the respondent’s ATDS interpretation would unreasonably create potential TCPA liability for all modern cell phone users, as all modern cell phones can store and dial numbers.