As we’ve previously noted, even though the FCC is actively considering a further order to define the proper scope of the TCPA’s ATDS definition, it has not stopped courts from reaching their own conclusions on this often-decisive issue of law. Indeed, as our updated infographic shows, since the D.C. Circuit’s opinion was released in March, numerous federal district and appellate courts have interpreted the ATDS definition differently, providing conflicting interpretations and decisions and creating further confusion for businesses and marketers nationwide.  On September 5, the District Court for the Middle District of Florida joined the ATDS interpretation cacophony with its decision in Gonzalez v. Ocwen Loan Servicing, LLC. 

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Background of the Gonzalez Decision

In Gonzalez, the district court ruled on Ocwen’s motion to dismiss, which asserted that the plaintiff’s TCPA claim failed to allege sufficient facts to support a claim that Ocwen contacted the plaintiff using an ATDS.  According to Ocwen, the plaintiff’s complaint was deficient because the plaintiff applied an incorrect, overly expansive ATDS definition that was used in the FCC’s 2003, 2008, and 2015 Orders, all of which Ocwen claimed were vacated by the D.C. Circuit’s March 2018 ruling in ACA International v. FCC.  Ocwen asserted that a narrower interpretation of ATDS based on the D.C. Circuit’s decision applied instead, and that such a definition did not include predictive dialers (the type of device the plaintiff asserted Ocwen used when it contacted him). 

Because the predominant arguments made by Ocwen were based on its interpretation of the ACA International decision, the court began its analysis by determining the scope of the holdings in ACA International.  The Court agreed with Ocwen that the D.C. Circuit’s rulinghad the effect of overturning the FCC’s earlier interpretations of the ATDS term.  “To conclude otherwise,” the court said, “would mean that courts are required to apply the definition of an ATDS—from the 2003 and 2008—Orders that the D.C. Circuit vacated when reviewing the 2015 Order.”

The court next turned to deciding how it would interpret the ATDS term now that binding FCC precedent was lacking to guide its analysis.  According to the Court, “the question as to what devices are ATDSs is still unresolved because ACA Int’l did not rule as to the correct interpretation of the statute.”  The court handed down its interpretation of the words chosen by Congress:

Having considered the statute, this Court concludes that the definition of an ATDS would not includea predictive dialer that lacks the capacity to generate random or sequential telephone numbers and dial them; but it would includea predictive dialer that has that capacity.  And because the D.C. Circuit determined that interpreting capacity to mean a device with a “future possibility” of having those functions is too expansive, this Court considered a device to have the capacity to generate random or sequential telephone numbers only if the device has the “present ability” to do so.

Thus, the court accepted Ocwen’s argument that a narrow ATDS definition applied.  Nevertheless, despite this legal win for Ocwen, the Court declined to dismiss the claims against it.  Instead, the court explained that, even though the ATDS definition only included devices that had the present capacity to generate random or sequential numbers, this did not preclude the possibility that Ocwen’s predictive dialers may possess such a capacity.  Accordingly, even though the plaintiff had not specifically pled that Ocwen’s predictive dialer was capable of dialing random or sequential numbers, the court nevertheless allowed the plaintiff’s case to proceed by holding that plaintiff’s flimsy allegations that Ocwen used an ATDS – hearing a pause when he answered before hearing a voice plus his allegation that Ocwen used a predictive dialer – was enough to satisfy his low burden at this stage of the proceedings. 

Practical Implications – Is Another ATDS Appellate Decision in Our Future?

By determining that the TCPA’s ATDS term only applies to devices that have the present capacity to generate random or sequential telephone numbers and dial those numbers, the Middle District of Florida joined the growing ranks of federal courts that are interpreting the ATDS definition narrowly or, in other words, the way Congress actually intended.  And as we’ve said before, this narrow interpretation may have profound benefits for companies that are the target of TCPA litigation if the interpretation becomes universally adopted. 

This particular ATDS decision may have future implications in the Eleventh Circuit, as it conflicts with interpretations made by other federal trial court judges in the courts in Alabama, Florida, and Georgia, which make up the Eleventh Circuit.  As our infographic shows, district courts within the Eleventh Circuit have been active when it comes to interpreting the ATDS term.  Indeed, in the last four months, we’ve seen at least four different opinions in which the term is interpreted, and in each of them the respective district court judge concluded that a different, conflicting definition applied:

  • In Reyes v. BCA Financial Services, Inc., the District Court for the Southern District of Florida held that the TCPA’s ATDS definition could be interpreted as applying to devices that had both the present and potential capacity of being used now or in the future to dial random or sequential numbers and/or numbers from a curated, stored list.
  • In Sessions v. Barclays Bank Delaware, a judge in the District Court for the Northern District of Georgia held that the TCPA’s ATDS definition could be interpreted as applying to devices that had only the present capacity of being used now or in the future to dial random or sequential numbers and/or numbers from a curated, stored list.
  • In Maddox v. CBE Group, Inc., another judge in the District Court for the Northern District of Georgia held that the TCPA’s ATDS definition could be interpreted as applying only to devices that had the present capacity to dial random or sequential numbers.

Given these conflicting interpretations, we will want to continue to watch whether the ATDS interpretation issue makes it up to the Eleventh Circuit on appeal and, if so, how the appellate court resolves it.

 


 

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