Kansas TCPA Decision Could Determine 10th Circuit ATDS Cases | Man’s pepper with trout

Recently, the Kansas District Court reviewed the definition of an Automatic Telephone Numbering System (“ATDS”) under the Telephone Consumer Protection Act (“TCPA”) in Hampton v. Barclays Bank Del. The Court concluded that the TCPA only applies to equipment that randomly or sequentially generates telephone numbers to be called and does not apply to dialers who call from a list of telephone numbers. a customer database.

Hampton’s complaint alleges that Marketplace Loan Grantor Trust Series 2016-LD1 (“Marketplace”) used an ATDS to call his cell phone without consent regarding his personal loan. Marketplace has engaged First Associates Loan Servicing, LLC (“First Associates”) to service the debt. First Associates uses a cloud-based calling system that does not use a random number generator or sequential number generator, and does not have the capability to do so. Instead, First Associates’ system uses telephone numbers generated from a customer database. In addition, the system does not use recorded messages or artificial voices, but rather live representatives who place the calls.

Marketplace argued that because First Associates’ calling system did not use a random or sequential number generator and did not have the ability to store numbers, the system was not an ATDS. Hampton argued that the calling system simply needed to have automatic dialing capability, but had no evidence that First Associates’ system did. Additionally, Hampton cited Marks vs. San Diego Crunch of the ninth circuit, indicating that a device capable of automatically dialing numbers stored in a list, rather than numbers generated randomly or sequentially, is considered an ATDS. The Court concluded that the TCPA does not apply to dialers who call from a list of numbers in a customer database for several reasons.

First, the Court agreed with the textual analysis of the Seventh and Eleventh Circuits of TCPA’s definition of an ATDS. The TCPA defines an ATDS as “equipment which has the capability- (A) to store or generate telephone numbers to be called, using a random or sequential number generator; and (B) to dial these numbers. These courts have ruled that the phrase “using a random or sequential number generator” modifies both “store” and “produce”. Generating numbers using a random or sequential number generator excludes devices that only dial numbers stored in a customer database. The court contrasted Brands which did not reach a conclusion on the wording of the law due to its ambiguity.

Next, the Court again agreed with the Seventh and Eleventh Circuits as to why the analysis in the Ninth Circuit regarding the TCPA exemptions is not convincing. The Court explained that it did not make sense for the law to exempt from liability appeals to consenting recipients or appeals about debts to the federal government if the law was meant to cover exclusively randomly or sequentially generated numbers. The Court said the TCPA made callers liable if they made calls using an ATDS or an artificial or pre-recorded voice. Thus, the use of an artificial or pre-recorded voice explains the exceptions.

The Court also notes that legislative history supports the interpretation that Congress wanted the law to eliminate machines that dialed randomly or sequentially generated numbers. Brands never discusses the legislative history of the law in this context.

Finally, the court said the argument that Congress refused to change the law in 2015 after the FCC order involved a tacit approval of the order is unconvincing. The Court clarified that congressional inaction does not necessarily reflect approval of the status quo. By the time Congress amended the TCPA in 2015, the FCC’s interpretation of the law was not yet settled.

There is a long history of the constantly evolving definition of what constitutes an ATDS under the TCPA. This Kansas court ruling is consistent with the Third, Seventh, and Eleventh Circuits, where a device that exclusively dials numbers into a database is not considered an ATDS for TCPA purposes. In contrast, the Ninth and Second Circuits have ruled that a system which stores telephone numbers and automatically dials them poses a real problem of material fact as to whether that system is an ATDS.

This is another case decided before the United States Supreme Court heard its case in Facebook vs. Duguid which will determine whether an ATDS includes a device that can store and dial stored numbers.

Alice P. Darby