On January 27, 2020, the United States Court of Appeals for the Eleventh Circuit endorsed a narrow definition of what constitutes an “autodialer” in a significant legal decision that effectively creates a circuit split with the Ninth Circuit Court of Appeals on this exact same issue.
This direct contradiction of the Ninth Circuit’s definition of autodialer is a welcome ruling for companies who have recently experienced nuisance lawsuits arising from their attempts to contact individuals for marketing purposes under the Telephone Consumer Protection Act (TCPA).
Three Significant Conclusions
In Glasser v. Hilton Grand Vacations Company, the federal court of appeals reached three major conclusions with respect to the TCPA which are described in detail below.
- A telephone system that randomly dials sequentially generated phone numbers from a predetermined list to reach individuals for marketing purposes, does not meet the definition of an automatic telephone dialing system, also known as an autodialer, under the TCPA.
- If an employee must “click” on a number in a computer application to dial and connect a call to another employee, that “clicker agent system” does not meet the definition of an autodialer under the TCPA because of the requirement of human intervention.
- Whether or not a voice on a phone call from a company is artificial or prerecorded is an independent legal matter under the TCPA, and is not relevant to the legal analysis regarding autodialer and TCPA liability. However, most courts will still hold that any artificial or prerecorded voice has the presupposition of meeting the TCPA definition of an autodialer.
This decision by the Eleventh Circuit Court of Appeals directly contradicts that of the Ninth Circuit Court of Appeals regarding the definition of an autodialer. Many companies successfully used autodialers to market their goods and services effectively to the 96% of Americans that are continually attached to their cell phones. With the ability to easily reach consumers quickly through cell phones, many companies have used technology, such as autodialers, to effectively reach millions of potential customers wherever they are.
Specific legislation was passed indicating that the use of an autodialer was only allowable with prior consumer consent. With this constricting legislation, many companies found themselves on the opposite side of lawsuits, especially when it came to autodialers.
Adding even more of a challenge to companies was the fact that the Ninth Circuit Court of appeals had previously defined an autodialer as any equipment that could store or produce telephone numbers that can be called using a random or sequential number generator to dial these numbers. The Eleventh Circuit held that if a telephone system simply relies on a pre-set list of telephone numbers (instead of creating that random list itself) then that system is not in and of itself considered an autodialer for purposes of the TCPA. The bottom line is that just because a telephone system has a predetermined list of numbers that it uses to make phone calls does not inherently make it an autodialer (at least in the Eleventh Circuit.)
Why This TCPA Case Matters
This case matters because it means that there is a greater chance that the Supreme Court will review this issue, as well as currently limit TCPA liability for companies using these types of computer systems to market consumers in, at least, this jurisdiction. The Eleventh Circuit reached this decision by noting that while the Federal Communications Commission (FCC) had adopted an expansive definition of autodialer, the D.C. District decision effectively eliminated that definition. With so many regulatory agencies and courts in disagreement, there is an opportunity for the Supreme Court to make a final decision with respect to both individual consumer rights as well as a company’s right to market to consumers.
How Can Outbound Call Centers Ensure They Are TCPA Compliant?
If you have any kind of a telephone system, make sure that you do not violate the TCPA or else you are likely to suffer hefty and substantial fines. If it is possible to separate the telephone system into different parts: one that dials versus another part that either creates or stores the telephone numbers, this may help you argue that your telephone system is not effectively an autodialer.
However, the best thing you can do to ensure that your telephone marketing system is not considered abusive to consumers under the TCPA act, or considered an autodialer by definition (at least in the Eleventh Circuit) is to have some sort of human intervention involved in the calling process. If, for example, an employee must “click” on a number in a computer application to dial a number and then connect the call to a different employee, this would effectively remove that system from the definition of an autodialer.
Finally, avoid using any artificial voice or any kind of recording to call a potential customer or client without their consent. These actions could bring an independent basis for liability under the TCPA that has nothing to do with the definition of “autodialer.”
If you are a company using this kind of telephone technology to contact consumers in Alabama, Georgia, or Florida, the court likely just gave you a gift of a reduction of litigation regarding TCPA cases. However, if you are in a different state, especially one that covers the Ninth Circuit (Alaska, Arizona, California, Idaho, Montana, Nevada, Oregon or Washington), you may wish to take extra care during this time of indecision and disagreement between circuit courts, and continue to err on the side of caution when using any kind of telephone system to contact potential consumers.
Eventually, the hope is that the Supreme Court, or perhaps even Congress, will weigh in on this important matter regarding the TCPA, which was enacted in 1991, long before cell phones became part of the fabric of our daily lives.