Those who have gotten complacent on autodialer compliance better pay attention right now.
No burying the lead:
Based on the weight of authority and the Supreme Court’s dicta in Footnote 7 of Duguid, this Court finds an autodialer that stores a list of telephone numbers using a random or sequential number generator to determine the dialing order is an ATDS under the TCPA.
Wow. Never a dull moment in TCPAWorld.
So for those following along, the U.S. Supreme Court’s ruling in Facebook held that an ATDS under the TCPA is a system that uses a random or sequential number generator (ROSNG) to “store” or “produce” telephone numbers to be dialed.
In footnote 7, the court held that one such system is a dialer that uses an ROSNG to determine the sequence in which numbers are dialed. (You can read all about these issues on our Facebook Ruling Resource page!)
Nonetheless, recent case have essentially disregarded Footnote 7 and found only systems that randomly generate–as opposed to store–telephone numbers to be dialed trigger the statute. So says the Ninth Circuit. And so said another court just last week.
But the court in Scherrer v. FPT, 2023 WL 4660089 (D. Colo. July 20, 2023) took a very different approach.
Recognizing that the Supreme Court’s Facebook ruling actually did NOT hold that phone numbers had to be randomly or sequentially generated to trigger the TCPA, the Court looked to fn7’s “dicta” as a valid example of when a system might use an ROSNG to “store” phone numbers to be dialed:
In Footnote 7, the Duguid Court gave an example of an autodialer that might store telephone numbers using a random or sequential number generator. Id. at 1172 n.7 (“For instance, an autodialer might use…a random number generator to determine the order in which to pick phone numbers from a preproduced list. It would then store those numbers to be dialed at a later time.” (emphasis added)). The Supreme Court’s own words demonstrate it had more in mind in terms of what may constitute an autodialer beyond the single patented device discussed in the Amici Curiae brief. And nothing in the text of the opinion or Footnote 7 suggests the Supreme Court’s patent-example was exclusive.
Plus the Court was completely unmoved that the Pace Amicus Brief–that lead to the creation of the footnote 7 loophole to begin with–was limited to randomly dialed numbers:
It is true that the specific patent discussed in the Amici Curiae brief was one in which a list of telephone numbers was generated using a number generator, and that list was then subjected to a second random number generator for storing and determining the calling order. See Amici Curiae, p.17. But this Court believes that the Hufnus and Timms decisions read too much into the Amici Curiae brief and patent to limit an ATDS to a device that either generates telephone numbers or one that dually generates telephone numbers, and subsequently, the calling order. In this Court’s view, this conclusion contravenes the Supreme Court’s express words.
The Sherrer ruling was decided by a Magistrate Judge and not an Article III district court judge but this is still a very big deal–especially since the analysis applied by the Court is pretty dead on.
Now understand, I am NOT rooting for the bad guys here. But the law is what the law is. And the Supreme Court’s Facebook ruling has not received the proper analysis it deserves from Courts recently. While I think defendants should walk away from cases like these with wins it should be for the right reasons–i.e. that the system does not use an ROSNG to store or produce phone numbers not to be dialed–and not due to any sort of inaccurate short cut.
More importantly, cases like this make it easier for me to do my job and provide SOUND AND VALID compliance advice–the system’s ability to randomly or sequentially sequence numbers for dialing is critical to evaluate. That’s what makes HUMAN SELECTION systems so valuable and what makes knowing your code so critical.
Yes, it would have been better if FN7 had never existed–and perhaps it shouldn’t– but we are where we are. And those who close their eyes to the footnote are likely to have egg on their face, as Sherrer reminds.
If you have questions on any of this–and the wise will–we are here to help.
And if you want more information on Human Selection systems, this podcast interview with Safe Select creator Dan Greenwell may help: