Back in October of 2019, the U.S. Supreme Court was petitioned to review a Ninth Circuit ruling regarding the Telephone Consumer Privacy Act (“TCPA”) on the following issues: 1) whether the TCPA’s prohibition on calls made by an automatic telephone dialing system (“ATDS”) is an unconstitutional restriction of speech, and if so whether the proper remedy is to broaden the prohibition to abridge more speech, and 2) whether the definition of ATDS in the TCPA encompasses any device that can “store” and “automatically dial” telephone numbers, even if the device does not “us[e] a random or sequential number generator.” Now, the Court has finally accepted writ of certiorari, limited to review of Question 2, described above.

ATDS Circuit Split

When the TCPA was enacted in 1991, most American consumers were using landline phones, and Congress could not begin to contemplate the evolution of the mobile phone. The TCPA defines “Automatic Telephone Dialing System” (ATDS) as “equipment which has the capacity—(A) to store or produce telephone numbers to be called, using a random or sequential number generator; and (B) to dial such numbers.” 47 U.S.C § 227(a)(1). In 2015, the Federal Communications Commission (FCC) issued its 2015 Declaratory Ruling & Order (2015 Order), concerning clarifications on the TCPA for the mobile era, including the definition of ATDS and what devices qualify. The 2015 Order only complicated matters further, providing an expansive interpretation for what constitutes an ATDS, and sparking a surge of TCPA lawsuits in recent years.

Consequently, several FCC-regulated entities appealed the 2015 FCC Order to the D.C. Circuit Court of Appeals, in ACA International v. FCC, No. 15-1211, Doc. No. 1722606 (D.C. Cir. Mar. 16, 2018). The D.C. Court concluded the FCC’s opinion that all equipment that has the potential capacity for autodialing is subject to the TCPA, is too broad. Although the FCC did say in its 2015 Order “there must be more than a theoretical potential that the equipment could be modified to satisfy the ‘autodialer’ definition”, the Court held that this “ostensible limitation affords no ground for distinguishing between a smartphone and a Firefox browser”. The Court determined that the FCC’s interpretation of ATDS was “an unreasonably expansive interpretation of the statute”.

Since the decision in ACA Int’l, courts have weighed in on the D.C. Circuit Court ruling and the status of the 2015 Order, sparking a circuit split over what constitutes an ATDS. The Second and Ninth Circuit have both broadly interpreted the definition of an ATDS, while the Third, Seventh and Eleventh have taken a much narrower reading. For example, earlier this year the Eleventh and Seventh Circuit Courts reached similar conclusions, back-to-back, narrowly holding that the TCPA’s definition of Automatic Telephone Dialing System (ATDS) only includes equipment that is capable of storing or producing numbers using a “random or sequential” number generator, excluding most “smartphone age” dialers. By contrast, the Ninth Circuit has concluded that “an ATDS need not be able to use a random or sequential generator to store numbers[.]”  The court explained that “it suffices to merely have the capacity to ‘store numbers to be called’ and ‘to dial such numbers automatically.’”

Supreme Court Petition

The Supreme Court has accepted petition for review of the Ninth Circuit ruling on the issue of whether the definition of “ATDS” in the TCPA encompasses any device that can “store” and “automatically dial” telephone numbers, even if the device does not “us[e] a random or sequential number generator.” The Supreme Court’s decision should help resolve the circuit split and provide greater clarity and certainty for parties facing TCPA class action litigation. The Court is expected to hear oral arguments on this dispute at the start next term, in the fall, and issue a decision by the summer of 2021.

Take Away

2020 is shaping up to be an important year for the TCPA. We recently reported on a much-anticipated Supreme Court decision, Barr v. American Association of Political Consultants, in which the court weighed in on the constitutionality of the TCPA, holding that the government debt collection exception of the TCPA violated the First Amendment, and must be invalidated and severed from the remainder of the statute. While it appears that courts are generally leaning towards the narrowing of the TCPA in a myriad of aspects, organizations are still advised to err on the side of caution, during this period of uncertainty, when implementing and updating telemarketing and/or automatic dialing practices.

Print:
EmailTweetLikeLinkedIn
Photo of Jason C. Gavejian Jason C. Gavejian

Jason C. Gavejian is a Principal in the Morristown, New Jersey, office of Jackson Lewis P.C. and a Certified Information Privacy Professional (CIPP/US) with the International Association of Privacy Professionals.

As a Certified Information Privacy Professional (CIPP/US), Mr. Gavejian focuses on the matrix…

Jason C. Gavejian is a Principal in the Morristown, New Jersey, office of Jackson Lewis P.C. and a Certified Information Privacy Professional (CIPP/US) with the International Association of Privacy Professionals.

As a Certified Information Privacy Professional (CIPP/US), Mr. Gavejian focuses on the matrix of laws governing privacy, security, and management of data. Mr. Gavejian is Co-Editor of, and a regular contributor to, the firm’s Workplace Privacy, Data Management & Security Report blog.

Mr. Gavejian’s work in the area of privacy and data security includes counseling international, national, and regional companies on the vast array of privacy and security mandates, preventive measures, policies, procedures, and best practices. This includes, but is not limited to, the privacy and security requirements under state, federal, and international law (e.g., HIPAA/HITECH, GDPR, California Consumer Privacy Act (CCPA), FTC Act, ECPA, SCA, GLBA etc.). Mr. Gavejian helps companies in all industries to assess information risk and security as part of the development and implementation of comprehensive data security safeguards including written information security programs (WISP). Additionally, Mr. Gavejian assists companies in analyzing issues related to: electronic communications, social media, electronic signatures (ESIGN/UETA), monitoring and recording (GPS, video, audio, etc.), biometrics, and bring your own device (BYOD) and company owned personally enabled device (COPE) programs, including policies and procedures to address same. He regularly advises clients on compliance issues under the Telephone Consumer Protection Act (TCPA) and has represented clients in suits, including class actions, brought in various jurisdictions throughout the country under the TCPA.

Mr. Gavejian represents companies with respect to inquiries from the HHS/OCR, state attorneys general, and other agencies alleging wrongful disclosure of personal/protected information. Mr. Gavejian negotiates vendor agreements and other data privacy and security agreements, including business associate agreements. His work in the area of privacy and data security includes counseling and coaching clients through the process of investigating and responding to breaches of the personally identifiable information (PII) or protected health information (PHI) they maintain about consumers, customers, employees, patients, and others, while also assisting clients in implementing policies, practices, and procedures to prevent future data incidents.

Mr. Gavejian represents management exclusively in all aspects of employment litigation, including restrictive covenants, class-actions, harassment, retaliation, discrimination, and wage and hour claims in both federal and state courts. Mr. Gavejian regularly appears before administrative agencies, including the Equal Employment Opportunity Commission (EEOC), the Office for Civil Rights (OCR), the New Jersey Division of Civil Rights, and the New Jersey Department of Labor. Mr. Gavejian’s practice also focuses on advising/counseling employers regarding daily workplace issues.

Mr. Gavejian’s litigation experience, coupled with his privacy practice, provides him with a unique view of many workplace issues and the impact privacy, data security, and social media may play in actual or threatened lawsuits.

Mr. Gavejian regularly provides training to both executives and employees and regularly speaks on current privacy, data security, monitoring, recording, BYOD/COPE, biometrics (BIPA), social media, TCPA, and information management issues. His views on these topics have been discussed in multiple publications, including the Washington Post, Chicago Tribune, San Francisco Chronicle (SFGATE), National Law Review, Bloomberg BNA, Inc.com, @Law Magazine, Risk and Insurance Magazine, LXBN TV, Business Insurance Magazine, and HR.BLR.com.

Mr. Gavejian is the Co-Chair of Jackson Lewis’ Hispanic Attorney Resource Group, a group committed to increasing the firm’s visibility among Hispanic-American and other minority attorneys, as well as mentoring the firm’s attorneys to assist in their training and development. Mr. Gavejian also previously served on the National Leadership Committee of the Hispanic National Bar Association (HNBA) and regularly volunteers his time for pro bono matters.

Prior to joining Jackson Lewis, Mr. Gavejian served as a judicial law clerk for the Honorable Richard J. Donohue on the Superior Court of New Jersey, Bergen County.