The Insights Association joined an amicus brief in a U.S. Supreme Court challenge to the definition of an autodialer in the Telephone Consumer Protection Act (TCPA). The leading nonprofit trade association representing the marketing research and data analytics industry joined 10 other business groups in the filing, including the U.S. Chamber of Commerce, American Financial Services Association, and Business Roundtable.

"This amicus brief will help shape the Supreme Court's ultimate ruling and clarify the TCPA so that marketing research via telephone may move forward without unnecessary lawsuit risk,” said Stuart Pardau, outside counsel to the Insights Association.

As explained in the amicus brief in Facebook v. Duguid, the “Ninth Circuit’s broad reading” of TCPA “threatens to impose liability on” the businesses “for communications that are helpful to, and desired by, consumers, thereby depriving consumers of these valuable communications.”

Facebook filed the case right after the Supreme Court ruled in Barr v. AAPC that the TCPA should remain intact, but struck down a 2015 exemption for calls collecting government debt. The U.S. government has already chimed in to support Facebook’s position

The 1991 TCPA statute requires prior express consent to use an automatic telephone dialing system to call a cell phone. An autodialer is defined as “equipment which has the capacity … to store or produce telephone numbers to be called, using a random or sequential number generator.” As explained in the amicus brief, that provision “targeted a specific, now-eradicated practice: telemarketers whose equipment randomly or sequentially dialed numbers and thereby shut down hospital switchboards, knocked out nascent cellular networks, and aggravated consumers with pricey per-minute charges.”

The Facebook case takes issue with lower court rulings like the Ninth Circuit’s in Marks v. Crunch San Diego that focus solely on autodialers having the “capacity” to “store numbers and dial them automatically.”

Such an “overly broad reading,” IA and its fellow amici argued, “captures nearly every modern calling device, from the equipment that organizations use to make these communications to the smartphone in your pocket. As a result, callers risk litigation—and at least $500 in damages per call, with $1500 for willful violations—every time they try to deliver essential, desired, and often time-sensitive communications.”

“Marks is wrong. As Facebook and the United States explain, it badly misconstrues the TCPA’s text, context, and history. But even if Marks’s reading of the statute were plausible, it still would have to be rejected. By treating every smartphone as an ATDS and by threatening liability for billions of legitimate calls and texts from organizations of all stripes, Marks violates the First Amendment.”

When TCPA was passed, the brief explained, “the vast majority of Americans used residential telephone lines as their primary means of communication, so businesses called these lines to provide information to their customers. Had Congress been concerned about such calls, it would have restricted ATDS calls to landlines, not merely hospital rooms, emergency lines, and wireless numbers.” Now, 60.3 percent of American adults live in households with only wireless phones (“wireless-only”). Another 18.6 percent live in households with a residential phone line, but with almost all calls being received on a cell phone ("wireless-mostly").[1]

As cell phones took over, so did the trial lawyers. “Between 2014 and 2017, roughly 5,000 TCPA cases were filed in state and federal court” and “nearly 3,000 TCPA lawsuits had been filed” in 2018 as of October of that year. After the Marks court decision, things got even worse: “in the first half of 2020 alone, more than 2,000 new TCPA cases have hit the dockets.”

Considering the “massive uncapped per-call statutory damages, uncertainty about the true scope of the law, and the prospect of burdensome discovery, many defendants,” including many in the insights industry, “have had to settle rather than fight—and at eye-watering numbers.”

Like many industires and professions that care about connecting with consumers via telephone, the insights industry has been reliant, until recently, on the promise of clarity from the Federal Communications Commission (FCC) on the definition of an autodialer. However, the agency has not taken action since losing a Circuit Court case challenging the FCC's 2015 TCPA regulations and now all eyes are on the U.S. Supreme Court.

"One way or another, marketing researchers hope that the nation's highest court can finally settle this issue and let us get back to work," concluded Howard Fienberg, VP Advocacy for the Insights Association.

 

[1] Blumberg SJ, Luke JV. Wireless substitution: Early release of estimates from the National Health Interview Survey, July-December 2019. National Center for Health Statistics. September 2020. https://www.cdc.gov/nchs/data/nhis/earlyrelease/wireless202009-508.pdf