SC Makes it Easier to Reach out and Touch Someone

April 9, 2021 at 9:22 am Leave a comment

It’s been more than a week now since a unanimous Supreme Court dramatically narrowed the reach of the Telephone Communication Protection Act (TCPA) and you can still hear the moans coming from class action attorneys everywhere who were feasting on alleged violations.

Since 1991, Congress has prohibited businesses from using auto-dialers to reach out to consumers without first getting their permission.  An auto-dialer is a device that has the capacity:

“(A) to store or produce telephone numbers to be called, using a random or sequential number generator; and “(B) to dial such numbers.”

Violations of the Act start at $500 and go up to $1,500 for willful violations.  In recent years, the TCPA has been used against both banks and credit unions.  In Facebook, Inc., Petitioner v. Noah Duguid, et al, Facebook was sued by a disgruntled consumer who received text messages that someone was trying to access his account.  The problem was that he, like your faithful blogger, is one of the 10 people left in the universe who doesn’t have a Facebook account.  Since Facebook reached out to him without his permission using an automated system, he claimed that it violated the TCPA.

Had his argument been successful, every cell phone in America would come within the reach of the TCPA.  In contrast, the Supreme Court decided as a matter of statutory interpretation that Facebook had the better side of the argument.  The Supreme Court ruled that for the TCPA to apply, the automated system must use a random or sequential number generator to both store and produce numbers to call.  Facebook uses an automated system to call its members, but does not use a random or sequential number generator. 

The Court said that it was up to Congress to give Mr. Duguid the interpretation he was looking for.  Senator Markey indicated that he plans to do just that.  In the meantime, hundreds of suits are legal dead ends.

Entry filed under: Legal Watch, Regulatory. Tags: , .

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Authored By:

Henry Meier, Esq., Senior Vice President, General Counsel, New York Credit Union Association.

The views Henry expresses are Henry’s alone and do not necessarily reflect the views of the Association. In addition, although Henry strives to give his readers useful and accurate information on a broad range of subjects, many of which involve legal disputes, his views are not a substitute for legal advise from retained counsel.

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