A proposed class-action lawsuit accusing Facebook of violating a federal anti-robocall law may not go forward because the social media company’s unwanted text messages aren’t covered under federal law, the Supreme Court ruled April 1.
The case, heard telephonically on Dec. 8, 2020, concerns a federal law that imposes penalties of up to $1,500 for each unwanted call or text. The prohibition on such calls applies to dialing systems that can “store or produce telephone numbers to be called, using a random or sequential number generator.”
To deal with a growing volume of telephone marketing calls, in 1991, Congress enacted the Telephone Consumer Protection Act (TCPA), to curb perceived telemarketing abuses. The statute “restricts the making of telemarketing calls and the use of automatic telephone dialing systems and artificial or prerecorded voice messages,” according to the Federal Communications Commission (FCC). The rules apply to telecommunications companies and other marketers.
In 1992, the FCC required that entities making telephone solicitations institute procedures for maintaining company-specific do-not-call lists. In 2012, the FCC imposed further restrictions on telemarketers to protect consumer privacy.
The TCPA creates a private right of action for persons to sue to enjoin unlawful uses of autodialers and to recover up to $1,500 per violation or three times the plaintiffs’ actual monetary losses.
Noah Duguid of Montana, a plaintiff suing Facebook who wanted his lawsuit to become a class action, argued that what he considers to be the company’s permissive interpretation of the TCPA would “unleash” a “torrent of robocalls” on the public. Duguid said he was besieged by texts from Facebook in 2014 advising him of an attempted log-in, even though he didn’t have a Facebook account.
Facebook denied responsibility, saying Duguid probably had a recycled phone number that used to be associated with an account.
Large corporations, including Home Depot Inc., Quicken Loans LLC, Aetna, United HealthCare Services Inc., and Salesforce.com Inc. filed briefs with the Supreme Court in support of Facebook’s position.
Facebook appealed the decision by the U.S. Court of Appeals for the 9th Circuit, which rejected Facebook’s argument that “the TCPA as a whole is facially unconstitutional.” Facebook had argued that restrictions on its ability to communicate infringed the First Amendment to the U.S. Constitution and that companies could be held liable for huge damages for relatively minor violations of the law.
The TCPA “proscribes abusive telemarketing practices by, among other things, imposing restrictions on making calls with an ‘automatic telephone dialing system,’” Sotomayor wrote for the Supreme Court.
As defined by the TCPA, such equipment must have the capacity both “to store or produce telephone numbers to be called, using a random or sequential number generator,” and to dial those numbers, the justice wrote.
“The question before the Court is whether that definition encompasses equipment that can ‘store’ and dial telephone numbers, even if the device does not ‘use a random or sequential number generator.’ It does not. To qualify as an ‘automatic telephone dialing system,’ a device must have the capacity either to store a telephone number using a random or sequential generator or to produce a telephone number using a random or sequential number generator.”
Because the device Facebook uses to send out text messages “neither stores nor produces numbers ‘using a random or sequential number generator,’ it is not an autodialer,” Sotomayor wrote.
“In sum, Congress’ definition of an autodialer requires that in all cases, whether storing or producing numbers to be called, the equipment in question must use a random or sequential number generator. This definition excludes equipment like Facebook’s login notification system, which does not use such technology.”
“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. Duguid’s interpretation of an autodialer would capture virtually all modern cell phones, which have the capacity to ‘store ... telephone numbers to be called’ and ‘dial such numbers,’” Sotomayor wrote, quoting from the statute.
“The TCPA’s liability provisions, then, could affect ordinary cell phone owners in the course of commonplace usage, such as speed dialing or sending automated text message responses.”
Facebook welcomed the Supreme Court ruling.
“As the court recognized, the law’s provisions were never intended to prohibit companies from sending targeted security notifications,” a Facebook spokeswoman told Bloomberg Law.
Megan Iorio, counsel at the nonprofit Electronic Privacy Information Center, expressed concern about the ruling.
“Many robocallers and would-be robocallers will interpret the court’s decision today as essentially abrogating the autodialer restriction, which will likely lead to a surge in unwanted automated calls to cell phones,” Iorio told the media outlet.