Marks Stopper: Iowa District Court Rejects Ninth Circuit’s “Overly Broad” ATDS Definition

Sometimes it takes courage to do the right thing.

In Harbach v. Usaa Fed. Sav. Bank, Case No. 15-CV-2098-CJW-KEM, 2019 U.S. Dist. LEXIS 3687 (N.D. Iowa  Jan. 9, 2019) the district court took the Ninth Circuit’s Marks opinion head on and obliterated it with brilliant legal reasoning.

The Harbach analysis tracks closely to Pinkus concluding first that the ACA Int’l decision set aside the 2003 and 2008 FCC formulations that treated predictive dialers lacking the ability to randomly or sequentially generate numbers as subject to the TCPA, and next that the absence of proof that a dialer can actually randomly or sequentially generate numbers to be dialed justifies judgment in favor of a defendant. The Court closely analyzed the statutory ATDS definition—re-introducing all of us to Eighth-grade grammar lessons regarding adverbial phrase usage that we promptly forgot—and concluded that the only reasonable reading of the TCPA requires random and sequential number generation. As the Court puts it:

This Court disagrees with the Ninth Circuit Court of Appeals’ interpretation that a device, to be considered an ATDS, must be capable of ‘dial[ing] [numbers generated using a random or sequential number generator] automatically.’ Marks v. Crunch SanDiego, LLC, 904 F.3d 1041, 1053 (9th Cir. 2018). As the D.C. Circuit recognized, to place a telephone call, numbers must necessarily ‘be called in some order-either in a random or some other sequence.’ ACA Int’l, 885 F.3d at 702 (emphasis in original)

So there.

Harbach is actually a really important case and one any TCPA practitioner should read carefully. It joins Roark as the only post-Marks decisions to expressly reject the Ninth Circuit’s broad dialer formulation as applied to predictive dialers. It also holds—similar to Keyes – that the Aspect predictive dialer is not an ATDS.

As an added bonus, Harbach also address a Reyes/Barton argument reaching the important (but rather obvious) conclusion that “as a matter of law, parties may, by mutual agreement, limit the means by which a consumer can withdraw consent to be called on the telephone, so long as the means contracted to are reasonable.” Harbach at * 52.  That’s rather neat and tidy. But the Court giveth and it taketh away concluding that a blanket consent clause lacking a revocation provision is revocable: “The Court agrees with plaintiff that the Second Circuit Court of Appeals went too far in Reyes when it concluded that a company could effectively defeat the TCPA by including a contractual provision barring a consumer from ever withdrawing consent.” Harbach at *53. Eesh.

The Court goes on to conclude that a clause reading “[t]o revoke this authorization, you may edit your profile by removing telephone numbers on which you do not want to receive such calls” is permissive in nature—again the reader will delight in a grammar lesson as the court parses the rules regarding when the word “may” is permissive vs mandatory—affording a consumer a non-exclusive means by which consent can be revoked. Thus, the Plaintiff was permitted to revoke consent orally (although there was a question of fact as to whether or not that happened.) While the Harbach defendant is likely confused as to why the Court even addressed the Barton issue after determining it was entitled to summary judgment on the ATDS issue, TCPAWorld can delight in the rather dense analysis the Court affords the one-line agreement.