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July 02, 2020

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The Lone Star State Speaks: Northern District of Texas Holds Predictive Dialers Are Not An ATDS

In the post-ACA battle over the definition of an ATDS, Texas was one of the few large states not to address the issue. Until now. In a first-in-the-state result, the Northern District of Texas rejected Marks and held that a predictive dialer is not an ATDS unless it has a random or sequential number generator. See Adams v. Safe Home Security, Inc., No. 3:18-cv-03098, 2019 U.S. Dist. LEXIS 126522 (N.D. Tex. July 30, 2019). And in doing so, the court read the actual text of the TCPA in a straightforward manner, to hold that only systems that 1) store numbers generated randomly or sequentially or 2) produce numbers randomly or sequentially qualify.

Interestingly, the plaintiff did not contest that ACA International invalidated the FCC’s 2003 and 2008 ATDS orders. They instead focused their attention on Marks and argued that the phrase “random or sequential number generator” only modified “produce,” and not “to store.” Under that formulation – which the Ninth Circuit adopted in Marks – a system that can store numbers and dial them automatically is an ATDS, even if the stored numbers are not randomly or sequentially generated.

The court ultimately rejected the Marks approach in favor of the more “common sense” reading and the FCC’s pre-2003 understanding of the term. The latter is significant. As the court recognized, the FCC held in 1992 that the TCPA does not apply to speed dialing or call forwarding “because the numbers called are not generated in a random or sequential fashion.” Not enough courts and litigants remember that 2003 was not the FCC’s first ATDS guidance. And if you’re trying to determine what the text of a statute passed in 1991 means, agency guidance from 1992 seems like a good place to start.

The fight over the proper interpretation of an ATDS continues in courts, before the FCC, and in front of Congress. For defendants in Texas, though, it is good to see the first court to address the issue take a common sense approach, and apply the statute as written.

© Copyright 2020 Squire Patton Boggs (US) LLPNational Law Review, Volume IX, Number 212


About this Author

Daniel Delnero specializes in representing companies facing high-stakes consumer class action litigation, with a particular emphasis on consumer financial services matters. He has successfully represented clients in large, complex matters, including the Telephone Consumer Protection Act (TCPA), Fair Debt Collection Practices Act (FDCPA), mergers and acquisitions litigation, First Amendment litigation, libel and defamation, contract disputes and business torts. Daniel also routinely represents companies and individuals facing intrusive governmental investigations,...

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