Statutory Definitions of an ATDS
47 U.S.C. §227. Restrictions on use of telephone equipment
(a) Definitions As used in this section
(1) The term “automatic telephone dialing system” means 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 C.F.R. §64.1200
(f) As used in this section:
(2) The terms automatic telephone dialing system and autodialer mean equipment which has the capacity to store or produce telephone numbers to be called using a random or sequential number generator and to dial such numbers.
Recent Case Decisions impacting the Definition of an ATDS
IMPORTANT April 1, 2021 UPDATE: U.S. Supreme Court Issues Long Awaited Decision on Facebook's Autodialer Appeal. The U.S. Supreme Court ruled (unanimously) in favor of our industry, correctly holding that to be considered an autodialer (ATDS) under the TCPA, the dialing system, "must have the capacity either to store a telephone number using a random or sequential number generator, or to produce a telephone number using a random or sequential number generator." I.e., if the calling system lacks the capacity to store or dial numbers randomly/sequentially, it is not an autodialer. This is welcome news and a victory for legitimate businesses who need to efficiently contact their customers and prospects. Numerous pending and stayed (postponed) TCPA lawsuits will likely be dismissed as a result of today's decision. How will the FCC react? How will congress react? How will Plaintiff's lawyers adjust their strategies? Will there still remain ambiguity regarding what "capacity" means? Much is still unknown. Many TCPA rules remain the same, of course. Among other things, the TCPA still restricts the delivery of recordings whether or not an ATDS is used. It also prohibits marketing calls to numbers on the DNC database, regardless of the dialing technology. Nevertheless, the Court's ruling rebuts a long-used plaintiff's argument treating virtually everything as an autodialer. In the words of Justice Sotomayor, "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."
Avaya Dialing System Held to be ATDS
In Heard v. Nationstar Mortgage LLC, the Court has held that the Avaya predictive dialer meets the definition of ATDS, even if the FCC's previous definitions of ATDS were overruled by the recent ACA v. FCC decision. The court zeroed in on the Avaya system's ability to "store" numbers, thus in part fitting the original statutory definition of an autodialer. Read the court's full opinion and order here. While this ruling is negative for the industry, there have been several positive rulings in recent months as well. The FCC will most likely be reevaluating its stance on autodialers in the upcoming months, as indicated in a recent letter from FCC Chairman Ajit Pai to several U.S. Senators. Although there have been court decisions on both sides of the issue, the upcoming FCC actions will be much more significant as the FCC is the agency charged with enforcing the TCPA and determining what an ATDS really is.
Michigan Court Finds that Dialers Calling from a List Do Not Automatically Qualify as ATDS
An opinion out of the Eastern District of Michigan has found that a dialer calling from a list does not automatically qualify as an ATDS under the TCPA unless it generates the dialed numbers sequentially or randomly. The court based this decision in part on the recent ACA v. FCC decision, which set aside the FCC's overly broad definition of ATDS. Read the full opinion here.
Two Recent Appellate Court Decisions Provide Limited Interpretation of ATDS
Two appellate court decisions in late June provide a favorable interpretation of ATDS for businesses in the industry. The cases, Dominguez v. Yahoo, Inc. and King v. Time Warner Cable Inc, were both pending when the DC Court of Appeals published its ACA vs. FCC decision which struck down the FCC's broad 2015 definition of ATDS. Both appellate courts in the above cases held that under the TCPA a device is not an ATDS unless it has the current capacity to dial random or sequentially generated numbers. Learn more about autodialer law. Read the two decisions here and here.
Court Holds that Manual Clicking Platform is Not an ATDS
Yet another good click-to-call court decision this year: In Bria Maddox v. CBE Group, Inc., a judge has ruled that CBE's Manual Clicker Application is not an ATDS because it requires call-by-call human intervention. The judge has granted CBE's motion do dismiss the TCPA claim of the plaintiff. Read the full order here.