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Marks Adopted for the First Time in the Sixth Circuit—State of Michigan Now Split on Requirements for TCPA Claim

Well the Wolverine state is now at war with itself—and I’m not talking about college football.

As we’ve reported previously, the Eastern District of Michigan has repeatedly followed the statutory approach to interpreting the TCPA’s phrase “ATDS” and required random or sequential number generation to state a TCPA claim. A court in the Western District of Michigan weighed in on the fight over the proper interpretation of an ATDS this week, however, and sided with the Ninth Circuit’s expansive holding in Marks that all dialers that call from a list of numbers automatically qualify under the TCPA.  This is the first time that Marks has been adopted within the Sixth Circuit and represents a further expansion of the Ninth Circuit’s TCPA reach.

In Allan v. Pennsylvania Higher Education Assistance Agency, No. 2:14-cv-54 (W.D. Mich. Aug. 19, 2019), the Court granted the plaintiffs’ motion for summary judgment requesting an award damages for the 353 calls the defendant made to the plaintiffs’ cell phones using a system that automatically dialed numbers from a list created using specific selection criteria (i.e., not randomly or sequentially generated).  In analyzing the issue of whether the defendant’s phone system qualifies as an ATDS, the Court ignored the Third Circuit’s decision in Dominguez v. Yahoo, 894 F.3d 116 (3d Cir. 2018) and the many other district court decisions we have previously reported on which have held that an ATDS must be capable of generating random or sequential telephone numbers.  Instead, the Court in Allan noted that “[t]he only circuit court to analyze the issue in depth since the D.C Circuit’s ruling in ACA International is the Ninth Circuit.”  The Court then analyzed the Ninth Circuit’s decision in Marks, highlighting the provisions of the TCPA that it claimed “presumes a definition of an ATDS that includes equipment dialing from a list of individuals.”  Without further discussion, the Allan Court agreed with the Ninth Circuit’s conclusion that “the statutory definition of ATDS includes a device that stores telephone numbers to be called, whether or not those numbers have been generated by a random or sequential number generator” and held that “because there is no question that the [defendant’s phone system] . . . uses store[d] telephone numbers to be called and automatically dials those numbers, the system qualifies as an ATDS.” 

The court’s decision in Allan, however, is not entirely bleak for defendants caught up in the ATDS confusion.  After concluding that the calls at issue violated the TCPA, the Court rejected the plaintiffs’ argument that the defendant violated the TCPA willfully and knowingly by continuing to call plaintiffs using an ATDS after they revoked consent to receive such calls.  The Court found that, because the defendant’s violations were made at a time when the FCC had equivocated on whether the type of system it used qualified as an ATDS, the defendant’s violations were not willful or knowing and, therefore, not subject to treble damages.

The takeaway here is plain—the battle over the TCPA’s ATDS definition is still raging on. Although court’s adopting the “statutory approach” are now the more numerous—and particularly so in 2019—a surprising number of courts continue to show a willingness to apply Marks.


© Copyright 2020 Squire Patton Boggs (US) LLPNational Law Review, Volume IX, Number 232


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