Legal Questions about TCPA Compliance Persist Three Decades Later

David Kalat

Congress moved quickly after a 1990 incident at Emory University and passed the Telephone Consumer Protection Act. But questions linger about TCPA compliance.

Atlanta’s Emory University was paralyzed in December 1990 by the telephone equivalent of a distributed denial-of-service attack—similar to how hackers can shut down a website by bombarding it with incoming requests until the server freezes.

Each of Emory’s 10,000 telephone extensions received a prerecorded call advertising a sweepstakes. Due to technology limitations of the time, recipients had no way to disconnect—hanging up the receiver had no effect. University officials tried desperately to identify and contact the company responsible, but the calls snarled the university’s telephone system for three days.

Congress acted in response to what happened at Emory and to similar instances elsewhere. But the fallout is still not fully understood nearly 30 years later.

Quick congressional action on robocalls

South Carolina Senator Fritz Hollings sponsored legislation designed to combat intrusive robocalls, which was ultimately enacted as the Telephone Consumer Protection Act (TCPA). The law provided a private right of action with statutory damages and a relatively low threshold to state and prove a claim—attributes that drew the attention of class action attorneys. Given the high volume of calls that could be placed by a single call center, TCPA class actions could sometimes aggregate together such large numbers of alleged claims as to create liabilities in the tens of millions of dollars or more.

The TCPA makes it unlawful to, among other things, use an automatic telephone dialing system (ATDS) or an artificial or prerecorded voice message to make a nonemergency call without prior express consent of the called party. Establishing whether the technology used to place the call is an ATDS is a foundational question that can either create or dissipate TCPA liability. 

The statute defines an ATDS as “equipment which has the capacity—to store or produce telephone numbers to be called, using a random or sequential number generator, and to dial such numbers.” But that phrase has been analyzed, parsed, and dissected by litigants and courts for almost as many years as there are words in it. 

Fuzziness around TCPA compliance for “predictive” autodialers

Worries about the use of a “random or sequential number generator” were rooted in experiences like what happened at Emory. By generating telephone numbers using a random or sequential algorithm, autodialers could call unlisted numbers, emergency services providers, multiple extensions at the same organization and other types of telephone numbers that would otherwise not appear on lead lists or databases of customer contact information. Put simply, an autodialer with the capacity to generate telephone numbers randomly or sequentially can place calls to numbers that would otherwise never be exposed to unwanted calls in the first place.

Legislators focused on these unique types of harm, where “automated calls are placed to lines reserved for emergency purposes, such as hospitals and fire and police stations” and where “automatic dialers will dial numbers in sequence, thereby tying up all the lines of a business and preventing any outgoing calls.” The House Committee on Energy and Commerce Report of November 5, 1991, noted: “Telemarketers often program their systems to dial sequential blocks of telephone numbers, which have included those of emergency and public service organizations, as well as unlisted telephone numbers... This capability makes these systems not only intrusive, but, in an emergency, potentially dangerous as well.” 

The Federal Communications Commission (FCC) was charged to draft regulations to implement and enforce the TCPA. This prompted industry concern, especially from debt-collection companies and affiliated organizations, that the FCC might seek to apply the law to calls made using “predictive dialers,” which do not as a rule generate random or sequential numbers to be dialed; they typically draw telephone numbers from external sources such as databases of customer accounts or lists of sales prospects curated by third-party provider.

The FCC originally concluded that predictive dialers did not fall within the TCPA’s definition of an automatic dialing system. But in 2003, the FCC’s Final Rule concluded that for the purposes of the TCPA, predictive dialers would be considered ATDSs. The FCC reiterated this in a 2008 ruling and again in a 2015 Omnibus Ruling.

Autodialer uncertainty persists

Legal challenges followed, and to this day there is no consistent nationwide understanding of how to interpret the TCPA’s statutory definition of an ATDS.

The US Court of Appeals for the District of Columbia Circuit subsequently overturned the FCC’s 2015 Omnibus Ruling, and federal district courts have split on the issue. The Third, Seventh and Eleventh Circuits decided that an autodialer must have the present ability to generate telephone numbers randomly or sequentially, while the Ninth Circuit decided that a system that dials numbers from a stored list is an ATDS.

Whether the US Supreme Court will seek to resolve the circuit split is unknown. The FCC has not issued guidance in years, and the likelihood that it will seems to fade with the passing of time.

The TCPA may have defined “automatic telephone dialing system” in 1991, but the confusion of the last three decades has arisen from attempts to expand that definition beyond the literal meaning of its words. What kind of confusion the future may hold depends a great deal on how courts interpret those 26 words in future court cases.