Manatt’s Continuing Coverage on Significant Post-ACA International Developments

TCPA Connect

The recent trend of confusion and uncertainty surrounding the proper definition of an automatic telephone dialing system (ATDS) continues in full force as courts remain split on the issue. Nearly two years after the D.C. Circuit’s landmark decision in ACA International (ACA) striking down the Federal Communication Commission’s (FCC’s) overly expansive 2015 definition, courts continue to debate whether ACA left prior FCC guidance intact, resulting in varying interpretations across the country of what constitutes an ATDS.

The Second, Third and Ninth Circuits remain the only significant appellate-level decisions to date, and the FCC has not issued any new guidance to help clear up the debate. At the district court level, the courts in the Ninth Circuit continue to follow the Ninth Circuit’s plaintiff-friendly decisions in Marks v. Crunch San Diego and more recently Duguid v. Facebook , which reaffirmed Marks, and others follow either Marks or, to a slightly greater extent, the Second Circuit’s opinion in King v. Time Warner Cable and/or the Third Circuit’s opinion in Dominguez v. Yahoo, both of which arguably favor the defendants.

Since our last update, we have observed no significant shift in how the district courts are interpreting ACA or defining an ATDS—i.e., still a little over half of the district court cases we have reported on have found when applying ACA that there was an ATDS (though plaintiffs seem to be surviving dismissal slightly more often than in previous months); a little over a third have held that ACA invalidated all prior FCC orders defining an ATDS (though many have declined to discuss this issue at all); and about one-fifth have found that human intervention was a deciding factor as opposed to just the 2015 order discussed in ACA. The Second Circuit continues to lead the way with the highest number of post-ACA district-level decisions, followed closely by the district courts of the Ninth, Eleventh and Seventh Circuits. Six significant district-level opinions have been issued in the past month: one from the Third Circuit, one from the Eleventh Circuit and two from the Ninth Circuit.

As part of our continuing coverage in this area, Manatt’s TCPA team monitors and reports on significant developments at the FCC and on noteworthy (i.e., dispositive or class certification-related) federal district- and appellate-level decisions interpreting, applying or otherwise evaluating ACA in ways that may impact our readers. To read all our previous articles on post-ACA developments, please click here. The last month saw several significant decisions involving disputes over the definition of an ATDS. In one case in the Middle District of Florida, a judge declined to apply the Marks rationale, instead electing to follow the weight of authority in the Eleventh Circuit in holding that a system “must possess the capacity (1) to store telephone numbers using a random or sequential number generator or (2) to produce telephone numbers using a random or sequential number generator” to constitute an ATDS. In addition, we have selected five key cases to highlight below.

Summary of Recent Decisions

Ammons v. Diversified Adjustment Service, Inc., No. 218CV06489ODWMAAX, 2019 WL 5064840 (C.D. Cal. Oct. 9, 2019).

In another win for a defendant using the LiveVox HCI (Human Call Initiator) system, U.S. District Judge Otis Wright, applying Marks, held that LiveVox HCI is not an ATDS because it is not capable of automatic dialing and requires human intervention in order to make calls. According to the court, LiveVox HCI, which utilizes a “clicker agent” to physically click a dialog box to launch each individual call, “does not use any predictive algorithms in launching the calls” and “has no capacity to store numbers to be called, to produce numbers to be called using a random or sequential number generator, or to dial numbers automatically.” While acknowledging that Marks “envisioned that some level of human interaction with a system may still qualify as an ATDS,” Judge Wright said that LiveVox HCI “goes far beyond merely triggering a system to run automatically” and “requires human interaction to initiate each call.” Judge Wright’s opinion cited favorably prior examinations of LiveVox HCI in both Collins v. Nat’l Student Loan Program, 360 F. Supp. 3d 268, 273 (D.N.J. 2018), and Marshall v. CBE Grp., No. 2:16-CV-02406-GMN (NJK), 2018 WL 1567852, at *7 (D. Nev. Mar. 30, 2018).

To read the full order in Ammons v. Diversified Adjustment Service, Inc., please click here.

Lamkin v. Portfolio Recovery Assoc., LLC, No. 218CV03071WBSKJN, 2019 WL 4670829 (E.D. Cal. Sept. 25, 2019).

Applying Marks and Duguid, U.S. District Judge William B. Shubb granted summary judgment in favor of plaintiff Lamkin, holding that a system with the ability to “store numbers to be called” and “dial such numbers automatically” constitutes an ATDS. Defendant PRA did not dispute the fact that its predictive dialer, the Avaya Proactive Contact Technology, had the ability to store telephone numbers, did in fact store telephone numbers and could dial stored telephone numbers without human intervention, but instead argued that under the Ninth Circuit’s opinion in Satterfield v. Simon & Schuster, Inc., 569 F.3d 946 (9th Cir. 2009), a device “must have the capacity to generate random or sequential numbers to constitute an ATDS.” The court disagreed, stating that the court in Satterfield did not address whether a predictive dialer must generate random or sequential numbers to be an ATDS because the 2003 FCC order, which defined ATDS to include predictive dialers, was still in effect at the time of the court’s 2009 opinion. In so holding, the court reaffirmed that the Marks definition of an ATDS controls.

To read the full memorandum and order in Lamkin v. Portfolio Recovery Assoc., LLC, click here.

Bodie v. Lyft, No. 3:16-CV-02558-L-NLS, 2019 WL 4918043 (S.D. Cal. Oct. 4, 2019).

U.S. District Judge M. James Lorenz denied Lyft’s motion to dismiss, finding the complaint adequately alleged that Lyft’s use of text messaging platform Twilio constituted an ATDS. Applying Marks, the court interpreted an ATDS as equipment that can either store numbers to be called and then dial them or produce numbers to be dialed using a random or sequential number generator. Specifically, the court stated, “Twilio customers, like Lyft, access the platform in order to create message content or portions of content, upload and store content and/or telephone numbers, and automatically send text messages to the stored list of cellular telephone numbers.” Judge Lorenz also emphasized that “a total lack of human intervention was not required for a device to qualify as an ATDS.”

To read the full order in Bodie v. Lyft, click here.

Rivero v. D’Jais, LLC, No. CV1812697FLWZNQ, 2019 WL 4784175 (D.N.J. Sept. 30, 2019).

On defendant D’Jais’ motion to dismiss, U.S. District Judge Freda L. Wolfson, interpreting Dominguez, held that a device constitutes an ATDS if it has the capacity to generate and dial random or sequential numbers, regardless of whether it utilizes those functions in making calls. D’Jais disputed the sufficiency of Rivero’s allegations, specifically the inference that the text messages that Rivero received were sent to many recipients and therefore supported the argument that D’Jais used an ATDS. For the court’s part, it acknowledged that “for purposes of proving Rivero’s claims through a motion for summary judgment or at trial ‘[a] device’s ability to simultaneously send a message to more than one (1) recipient has nothing to do with whether it has a present ability to generate random or sequential numbers, and then message those numbers.’” However, on a motion to dismiss, the court stated these factual allegations “raise Rivero’s claims to the level of plausibility, because it is plausible that a business that uses mass text messages to promote itself would use equipment that has the capacity to generate random or sequential numbers and text those numbers, even if a particular recipient’s phone number were not generated randomly or sequentially.”

To read the full opinion in Rivero v. D’Jais, LLC, click here.

DeCapua v. Metro. Prop. and Cas. Ins. Co., No. CV 18-00590-WES, 2019 WL 4757995 (D.R.I. Sept. 30, 2019).

Following recent decisions by district courts concluding that ACA did not invalidate the pre-2015 FCC guidance on the definition of an ATDS, U.S. Magistrate Judge Lincoln D. Almond stated that a system constitutes an ATDS if it has the capacity to generate numbers to be called randomly or sequentially without human intervention. On defendant’s motion to dismiss, Magistrate Judge Almond said that EZ Texting’s system “cannot send a text without a person physically inputting numbers, drafting a message, selecting recipients, choosing a date and time to send the message, and manually hitting a ‘send’ button” and therefore fails to meet the definition of an ATDS.

To read the full report and recommendation in DeCapua v. Metro. Prop. And Cas. Ins. Co., click here.

A Numerical Overview of Post-ACA International Cases

At the time of publication of this edition of TCPA Connect, the overall landscape of post-ACA case law breaks down as follows (changes reflected in bold):

Case Law by FCC Order Validity

  • 17 cases say all FCC orders invalidated
  • 33 cases say only some/part of FCC orders invalidated

Case Law by Circuit

  • 2 cases from the First Circuit district courts
  • 19 cases from the Second Circuit district courts and 1 from the Second Circuit
  • 9 cases from the Third Circuit district courts and 1 from the Third Circuit
  • 2 cases from the Fourth Circuit district courts
  • 1 case from the Fifth Circuit district courts
  • 6 cases from the Sixth Circuit district courts
  • 12 cases from the Seventh Circuit district courts
  • 2 cases from the Eighth Circuit district courts
  • 14 cases from the Ninth Circuit district courts and 2 from the Ninth Circuit
  • 3 cases from the Tenth Circuit district courts
  • 13 cases from the Eleventh Circuit district courts

Case Law by Appellate Level

  • 4 appellate-level cases (Second, Third and Ninth Circuits)

Case Law by Autodialer Decision

  • 39 cases where autodialer was found
  • 31 cases where autodialer was not found
  • 13 cases where human intervention was a deciding factor in determining that the system was not an ATDS

To read all our previous articles on post-ACA International developments, please click here.