Consumer Crossroads: Where Financial Services and Litigation Intersect

We analyze in this client advisory the recent decision by a unanimous U.S. Supreme Court to narrow the definition of what constitutes an automatic telephone dialing system, or autodialer. Our analysis includes a take on the potential impacts of the decision, as well as the significance of a Democratic Party-controlled FCC. We note that the TCPA has not gone away and callers should continue to carefully consider how best to comply with its provisions to avoid further litigation and regulatory risk.

Hinshaw continues to monitor the deepening circuit split over what constitutes an automatic telephone dialing system (ATDS) under the Telephone Consumer Protection Act (TCPA), which restricts certain automated calls and text messages. To say there has been substantial debate by the courts and FCC concerning what constitutes an ATDS would be putting it lightly. And, just when it seemed a majority position was emerging, the playing field seems to have leveled with the Second Circuit's decision in Duran v. La Boom Disco, Inc.

The Second Circuit, in King v. Time Warner Cable, Inc., and the Third Circuit, in Dominguez v. Yahoo!, Inc., relied upon the D.C. Circuit's decision in ACA International v. FCC in limiting the definition of an autodialer under the Telephone Consumer Protection Act. Dominguez found that Yahoo's text message system did not fit the definition of autodialer, while King emphasized that only a device that currently has the ability to perform autodialing functions can qualify as an autodialer system.