Another Case Holding Random or Sequential Number Generation Is Required For An ATDS under the TCPA

While the world is all watching curiously to see whether the SCOTUS will swing the axe this time at the TCPA’s content-specific exemption, a decision yesterday by the Middle District of Florida has drawn my attention, as it held that random or sequential number generation is required for a device to qualify as an ATDS under the TCPA. (See Morgan v. Adventist Health System/Sunbelt, Inc., et al., Case No. 6:18-cv-1342-Orl-78DCI (M.D. Flo., Jan. 13, 2020).) The court’s order adds to the number of cases holding random or sequential number generation is key in determining an ATDS. (Kindly note, refer to our popular post – “TCPAWorld’s Rolling ATDS Review” – for lists of courts’ split opinions.)

Defendant Adventist Health System/Sunbelt, Inc.’s (“AdventHealth”) hospital facility treated a non-party M.R. back in 2015. At that time, M.R. gave AdventHealth permission to contact her at a phone number ending in 2301 (“2301 Number”). Later, this 2301 Number was reassigned to Plaintiff. Defendant Medical Services, Inc. (“MSI”) was a contractor of AdventHealth for the purpose of payment collection. And defendant North American Credit Services, Inc. (“NACS”) was another contractor of AdventHealth for the purpose of debt collection. MSI and NACS placed four calls in total to Plaintiff’s 2301 Number, and as a result of these calls, Plaintiff sued all three defendants for violations of the TCPA.

In the defendants’ Motions for a Final Summary Judgment on Plaintiff’s TCPA Claims, defendants argue that they reasonably relied on the express consent given by the prior holder of the 2301 Number, and cited to ACA Int’l v. FCC, 885 F. 3d 687 (D.C. Cir. 2018). Defendants also argue that they did not use an ATDS to make calls to Plaintiff because the system used by them to make the calls at issue does not randomly or sequentially generate numbers to be called.

As to defendants’ first argument, the court found that “Defendants read ACA International too broadly.” (See January 13, 2020 Order [“Order”] at p. 4.) The court stated that pursuant to the FCC’s 2015 declaratory ruling, the caller was allowed “one – and only one – liability free, post-reassignment call” to the current subscriber of a reassigned telephone number if it lacked knowledge of the reassignment and had a reasonable basis to believe there was valid consent for the call. However, the ACA Int’l court found that this one-call safe harbor rule is arbitrary, and thus set aside the FCC’s treatment of reassigned numbers as a whole. The ACA Int’l did not adopt any reasonable reliance test or exception when dealing with reassigned numbers. Therefore, the court found that defendants’ argument based on the ACA Int’l failed.

With respect to defendants’ second argument, the court agrees with the majority of the courts in the district that ACA Int’l, “in invalidating the 2-15 FCC definition of an ATDS, also necessarily vacated the prior definitions that the 2015 definition reaffirmed.” (See Order at p. 5.) The court thus determined that it is not bound by the FCC’s 2003 and 2008 declaratory ruling. (Again, refer to another of our popular posts – “The Developments That Rocked TCPAWorld” – for all of FCC’s declaratory rulings as well as other key decisions and developments regarding the TCPA.)

An ATDS must “ha[ve] the capacity … to store or produce telephone numbers to be called, using a random or sequential number generator.” (47 U.S.C. § 227(a)(1)(A).)  Here, the qualifying phrase – “using a random or sequential number generator” – modifies both “store” and “produce.” (See Order at p. 6.) Thus, by looking at the plain language of the statue itself, the court found that a system must have the present ability to randomly or sequentially generate telephone numbers to be an ATDS under the TCPA. Accordingly, defendants’ system is not an ATDS given that it does not have the present capability to randomly or sequentially generate telephone numbers.

For these reasons, the court granted defendants’ summary judgment motions on all of Plaintiff’s claims based on the use of an ATDS, and denied in all other respects.

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