Telemarketing and Consumer Fraud and Abuse Prevention Act (TCPA), originally enacted in 1991, prohibits calls to cell phones using an "autodialer." A 2003 FCC Order includes text messages within the scope of prohibited calls. The TCPA permits private parties to sue and recover at least $500 in damages for each call made in violation of the statute, with treble damage awards for willful or knowing violations. Perhaps not surprisingly, the TCPA is a potent source of litigation, including multi-state class action lawsuits.
The TCPA defines an "autodialer" as "equipment which has the capacity - (A) to store or produce telephone numbers to be called, using a random or sequential number generator; and (B) to dial such numbers." Congress intended the provision to address calls by telemarketers and mass robocalls in large sequential lists or random dials of 10-digit numbers. However, in
the Ninth Circuit
departed from a straightforward reading of the TCPA by concluding autodialer equipment need do no more than merely dial (or text) stored telephone numbers to meet the statutory definition. By this rendering, a device that stores and dials numbers need not have number generating capacity to fall under the statute's prohibition. Storing telephone numbers is a commonplace device function. So, for practical purposes, the Ninth Circuit read the "random or sequential number generator" functionality requirement out of the statute. By doing so, the effect of its decision was to subject the owners of all smartphones to potential liability under the TCPA.
The Ninth Circuit's ruling is also contrary to the reasoning of the D.C. Circuit's decision in
ACA International v. FCC
, the D.C. Circuit struck down rules adopted in the FCC's 2015 Order defining the types of calling equipment that fall within the TCPA's autodialing restrictions. The D.C. Circuit concluded those rules were utterly unreasonable and outside the scope of the agency's authority: "It cannot be the case that every uninvited communication from a smartphone infringes federal law, and that nearly every American is a TCPA-violator-in-waiting, if not a violator-in-fact." By adopting a rule that more narrowly defines autodialing – that is, requiring prohibited equipment to have current capacity to generate numbers to be dialed without human intervention – the FCC effectively can resolve the conflict in legal reasoning between the D.C. Circuit and Ninth Circuit decisions in a way that doesn't stifle innovations in messaging applications that are responsive to consumer demand.
First Amendment jurisprudence reinforces the wrongfulness of the Ninth Circuit's expansive interpretation of the TCPA's autodialing provision. By effectively making all smartphone owners who make a single unwanted call or text subject to liability as autodialers, the Ninth Circuit's statutory interpretation prohibits a substantial amount of protected speech, both in an absolute sense and relative to the TCPA's legitimate purpose. As the D.C. Circuit pointed out in
the TCPA was "grounded in concerns about hundreds of thousands of 'solicitors' making 'telemarketing' calls on behalf of tens of thousands of 'businesses'" and not in concerns about "routine communications by the vast majority of people in the country."
The serious First Amendment overbreadth issues raised by treating smartphones as autodialers should compel a narrower interpretation. The canon of constitutional avoidance requires courts, when possible, to interpret a statute in a way that avoids constitutional issues. The FCC can avoid such First Amendment overbreadth problems by adopting a rule that construes the TCPA's autodialing provision to include only devices or equipment with current capacity: (1) to store or produce phone numbers using a random or sequential number generator; and (2) to dial such numbers without human intervention.
FCC adoption of a narrower interpretation of autodialers is necessary to avoid suppressing the presently vibrant market for text messaging services. According to CTIA's Annual Industry Survey, nearly 1.8 trillion such messages were sent in the U.S. in 2017 alone. Spam rates are exponentially lower for text messages (estimated 2.8%) than for other communications platforms such as email (estimated 53%). And unwanted texts are a far less intrusive problem than the growing number of robocalls (estimated 48 million in 2018).
Wireless service providers have the technological means in current use and in development to combat unwanted messages. Texts can be scanned and categorized, and machine-learning technologies can filter out unwanted messages much easier than with robocalls. As the FCC recognized in its
Wireless Messaging Services Order
In the absence of a Commission assertion of Title II regulation, wireless providers have employed effective methods to protect consumers from unwanted messages and thereby make wireless messaging a trusted and reliable form of communication for millions of Americans." The
Order's classification of SMS and MMS as lightly-regulated Title I services was bolstered by the FCC's agreement "
that the Commission should not allow wireless messaging services to become plagued by unwanted messages in the same way that voice service is flooded with unwanted robocalls."
Instead of stretching TCPA beyond Congress's intent to make potential violators of anyone who sends a single unwanted message, encouraging new technological solutions to combat unwanted calls and texts is the sounder policy approach. The Ninth Circuit's ruling in
turns the TCPA's autodialing provision inside out by making every smartphone owner in America a potential violator. The FCC must take prompt action to avoid this indefensible result.
In sum, the FCC should adopt a rule that defines prohibited autodialers to mean equipment with current capacity to store or produce phone numbers using a random or sequential number generator and with capacity to dial those numbers without human intervention. Adoption of such an interpretive rule tracks with the TCPA. It would avoid gross overextension of personal liability for smartphone owners. Such a rule also would avoid First Amendment overbreadth problems. And it would be in keeping with the
Wireless Messaging Service Order
's determination that "
continuing to empower wireless providers to protect consumers from spam and other unwanted messages is imperative."
* Randolph J. May is President and Seth L. Cooper is a Senior Fellow of the Free State Foundation, an independent
nonpartisan free market-oriented think tank located in Rockville, Maryland.
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