Earlier today the FCC released a Public Notice seeking comment on how the Commission should interpret the phrase “automatic telephone dialing system” in light of the Ninth Circuit’s decision in Marks v. Crunch San Diego, LLC, which was issued on September 20, 2018.  As we noted in our discussion of the Marks decision, the Ninth Circuit’s view of the ATDS definition is one of the most expansive we have seen since the D.C. Circuit struck down the FCC’s 2015 Omnibus TCPA Order in March 2018. Indeed, many courts have taken a much narrower view of the ATDS term, including the Third Circuit in Dominguez v. Yahoo, Inc. The chief area of disagreement is whether the device that is used to originate the phone calls must “randomly or sequentially generat[e] telephone numbers, and dial those numbers,” as the Third Circuit concluded, or whether the device must simply have“the capacity to dial stored numbers automatically,” as the Ninth Circuit concluded.

The difference in interpretation has profound consequences:  If sued in the Third Circuit, a company dialing a list of phone numbers that it has obtained directly from its customers (as compared to a list of “random” phone numbers), would most likely not be considered to have used an ATDS (and thus may fall outside of the TCPA’s scope), whereas if that same company is sued in the Ninth Circuit, it would likely still be found to have used an ATDS and thus be subject to the TCPA.  Given the statutory damages included in the TCPA and the potential for class action litigation, the consequences could not be more severe and, thus, the need for clarity more essential.

Indeed, this is where the FCC’s Public Notice comes into play.  As many of you know, the FCC has already requested public comment on the proper scope of the ATDS definition.  We represented a coalition of 18 different companies, led by SMS platform provider Tatango, to urge the FCC to clarify the definition of ATDS by ensuring that it adhered to the original, narrow view of the definition understood by Congress when the TCPA was originally adopted.  The Commission has not yet acted to address the issue, however.  Therefore, it is giving interested parties one more chance to weigh in on this critical topic before it releases an order clarifying the scope of the ATDS definition.  And, now that there are such disparate decisions coming from the courts, we expect that the FCC will act expeditiously to provide guidance on this issue. (Importantly, the FCC’s decision will supersede the decisions reached by the courts, including the Courts of Appeal, under existing precedent requiring deference to the FCC because it has been empowered by Congress to interpret and apply the TCPA.) 

The Public Notice calls for opening comments to be filed by October 17, 2018, and reply comments by October 24, 2018.  If your business is interested in taking this opportunity to weigh in on this important issue, please set up a call with us to talk further.

 


 

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