Wayne Streibich, Diana M. Eng, and Andrea M. Roberts

Financial institutions, debt collectors, and consumer-facing businesses should take note that the United States Supreme Court has ruled that the definition of an “autodialer” under the Telephone Consumer Protection Act, as written, requires that the device must use a random or sequential number generator. This narrow interpretation should shield companies from liability in current or future actions, where the consumers’ telephone numbers are known and not random or sequentially generated.

In Facebook, Inc. v. Duguid, 592 U.S. ___ (2021), the United States Supreme Court (“SCOTUS”) narrowly interpreted the definition of “autodialer” under the Telephone Consumer Protection Act (“TCPA”), holding the definition excludes equipment that does not use a random or sequential number generator. SCOTUS specifically held that an “automatic telephone dialing system” is limited to equipment that either stores a telephone number using a random or sequential number generator, or produces a telephone number using a random or sequential number generator.

Summary of Facts and Background

Plaintiff Noah Duguid (“Plaintiff”) began receiving several login-notification text messages from defendant Facebook, Inc. (“Facebook”), alerting him that someone had attempted access to the Facebook account associated with his phone number from an unknown browser. Plaintiff never had a Facebook account and had not given Facebook his phone number. As such, Plaintiff commenced a putative class action in the District Court for the Northern District of California (“District Court”) against Facebook, alleging it violated the TCPA by maintaining a database that stored phone numbers and programmed its equipment to send automated text messages to the stored phone numbers each time the person’s account was accessed by an unrecognized device or browser.

Facebook moved to dismiss, arguing that it did not violate the TCPA because Facebook did not use an automatic dialer, as its text messages were not sent to phone numbers that were randomly or sequentially generated. Rather, Facebook sent targeted, individualized texts to phone numbers linked to specific accounts. The District Court agreed with Facebook and dismissed Plaintiff’s complaint with prejudice.

Plaintiff appealed, and the United States Court of Appeals for the Ninth Circuit (“Ninth Circuit”) reversed the District Court’s order. The Ninth Circuit held that an autodialer “need not be able to use a random or sequential generator to store numbers; it need only have the capacity to ‘store numbers to be called’ and ‘to dial such numbers automatically.’” SCOTUS granted certiorari to resolve a circuit split among the Courts of Appeals regarding whether the definition of an “automatic telephone dialing system” includes equipment that can “store” and dial phone numbers, even if such equipment does not “us[e] a random or sequential number generator.”

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