United States: Business Groups Demand Clarity On Autodialers

TCPA is being abused because of broad FCC interpretation of technology, petitioners claim

Light Brigade

An array of business associations – drawn largely from the financial services industry – petitioned the Federal Communications Commission (FCC or Commission) in May 2018. Their goal: to wrest clarity from the FCC regarding a single aspect of the Telephone Consumer Protection Act (TCPA) that they maintain is leaving the door wide open to abuse of the law.

Chronicles

The petition focuses on the TCPA’s definition of “automatic telephone dialing system” (ATDS), which is at the heart of the act’s mandate.

The history so far, according to the petitioners:

Confusion over the exact definition led to an explosion of frivolous and expensive lawsuits that strayed beyond the original intent of lawmakers. Desperate calls for clarity led to the Commission’s 2015 Omnibus Order, which only made matters worse by embracing a broader ATDS definition that swept in many more devices than the text of the law supports – according to the petition, TCPA litigation jumped 46 percent in the wake of the Omnibus Order.

The petitioners declare their gratitude for a recent D.C. Circuit decision that vacated portions of the Omnibus Order, especially the FCC’s definition of ATDS, which the court called “utterly unreasonable,” “incompatible with” the statute’s goals and “impermissibly expansive.” But this decision is no substitute for a positive definition, which the petition urges the FCC to establish.

Capacity Fluxing

For the petitioners, it comes down to one word: capacity. The act defines ATDS to 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.” The petition states that the Omnibus Order broadly defined “capacity” so that devices that might be modified in the future to store or generate numbers and dial them were subject to TCPA litigation, even if they were not currently configured to do so.

The Takeaway

The petitioners, after citing numerous examples of allegedly exorbitant and frivolous lawsuits, “urge the Commission to ... (1) confirm that to be an ATDS, equipment must use a random or sequential number generator to store or produce numbers and dial those numbers without human intervention, and (2) find that only calls made using actual ATDS capabilities are subject to the TCPA’s restrictions.”

The petition may risk an overly narrow definition, however, when it asks the Commission to exclude devices that are not “inherently” autodialers. For instance, smartphones “require downloading an app or changing software code to gain auto dialing capabilities,” the petition reads. “Those capabilities are not built in.”

Alternatively, “other calling equipment can become an autodialer simply by clicking a button on a drop-down menu,” the petition states. “That function is already part of the device and requires a simple change in setting rather an alteration of the device.”

While such a distinction would certainly “narrow the range” of TCPA-covered devices, it will be interesting to see how the FCC takes it. Simply put, if a smartphone can use an autodialer app, isn’t it ... an autodialer?

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