November 27, 2022

Volume XII, Number 331


Court Finds that Debt Collection Makes Use Of Random or Sequential Number Generation Implausible

In a victory for debt collectors, the Central District of Illinois recently found that a plaintiff’s bare-bones allegations regarding use of an ATDS were particularly implausible because “the business of the defendant is such that it would not need a machine with random or sequential number generation capacities.” Mosley v. Gen. Revenue Corp., No. 20-01012, 2020 WL 4060767, at *3 (C.D. Ill. July 20, 2020).

In Mosley v. General Revenue Corp., the plaintiff alleged that a debt collection company used an ATDS and prerecorded messages to call her cellular telephone without her consent. Id. at *1. She claimed the calls concerned debts that were not hers, and some calls started with short pauses and “dead air.” Id.

In moving to dismiss the TCPA claim, the defendant argued that the plaintiff failed to plausibly allege use of an ATDS. Id. at *1-2. Relying on Gadelhak v. AT&T Services, Inc., 950 F.3d 458 (7th Cir. 2020) for its interpretation of the statutory definition of an ATDS, the defendant argued that the plaintiff had not plausibly alleged the dialing equipment could randomly or sequentially generate phone numbers. Id. at *2. The defendant also argued that the allegations were especially implausible in this case, as debt collection companies “call specific individuals, at specific numbers, about specific debts, not random individuals at random numbers.” Id. (citation omitted).

The Court dismissed the claim to the extent it was based on alleged use of an ATDS. Id. at *4. It noted that, although Gadelhak decided what the functionalities of an ATDS are, it did not address what a plaintiff must allege to state a plausible TCPA claim. Id. at *2. Recognizing that pre-Gadelhak district courts within the Seventh Circuit took differing approaches to the pleading standard—with some crediting conclusory statements regarding use of an ATDS, and others requiring factual allegations that made an inference plausible—the Court held that crediting conclusory allegations would contradict the rationale behind the Supreme Court’s decisions in Twombly and IqbalId. at *2, *4. Holding otherwise, the Court concluded, would “make huge swaths of otherwise innocuous phone calls at risk of litigation.” Id. at *3.

Though the Court agreed the plaintiff was not required to plead technical details to which she did not have access, it also found that a pause alone did not make an inference of ATDS use plausible. Id. That was particularly so in this case, the Court reasoned, because the defendant was a debt collector with no reason to use a system that randomly or sequentially generates phone numbers. Id. at *3-4. The plaintiff’s nonexistent relationship with the defendant did not make her claim more plausible, considering companies could “be in the business of purchasing debts from or collecting debts on behalf of others.” Id. at *4. Since the plaintiff offered “no plausible explanation why a debt collection company would need or use” equipment that generates numbers randomly or sequentially, the Court found the use of such equipment in this case was nothing more than “a speculative possibility.” Id.

This decision sides with other cases in the Seventh Circuit that require TCPA plaintiffs to plead sufficient factual allegations concerning use of an ATDS. Critically, it also shows that the nature of a defendant’s business—particularly one that involves calling specific people at specific numbers—can make conclusory statements about ATDS use all the more implausible.

© 2022 Faegre Drinker Biddle & Reath LLP. All Rights Reserved.National Law Review, Volume X, Number 241

About this Author

Vijayasri G. Aryama Associate Drinker Biddle Law Firm

Vijayasri G. (“Sri”) Aryama assists clients with various aspects of legal proceedings and trial preparation, including legal research and the drafting of motions and other legal memoranda.

While attending Rutgers Law School, Sri interned at the Department of Homeland Security, in the Immigration and Customs Enforcement (ICE) division. She conducted legal research and drafted briefs, memos, and Motions to Reopen on complex matters of immigration law, including criminal law violations that could impact removal proceedings. During law school, Sri also worked as a tax compliance...

Michael Daly, Drinker Biddle Law Firm, Philadelphia, Litigation and Retail Attorney

Michael P. Daly defends class actions and other complex litigation matters, handles appeals in state and federal courts across the country, and counsels clients on maximizing the defensibility of their marketing and enforceability of their contracts. A recognized authority on class action and consumer protection litigation, he often speaks, comments, and writes on recent decisions and developments in the class action arena. He is also a founder of the firm’s TCPA Team; the senior editor of the TCPA Blog, which provides important information and insight...