Reed Smith Client Alerts

On September 20, 2018, in Marks v. Crunch San Diego, LLC, No. 14-56834, 2018 WL 4495553 (9th Cir. Sept. 20, 2018), the Ninth Circuit Court of Appeals vacated the District Court’s grant of summary judgment in favor of Appellant Crunch Fitness (Defendant), concluding that under the TCPA, “the statutory definition of an 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.”  The Ninth Circuit’s ruling arguably marks the most expansive definition of ‘ATDS’ by any court since the statute was enacted almost thirty years ago, and is broader than even the FCC’s definition, which the D.C. Circuit recently invalidated in ACA Int’l. Fed. Comm’cns, 885 F.3d 687 (D.C. Cir. 2018).

Bottom line from Marks v. Crunch:

  • After ACA Int’l, all FCC guidance regarding the functions a device must perform to qualify as an ATDS have been wiped away.
  • The Ninth Circuit interpreted the statutory language without reference to the FCC’s guidance and found that the statute was ambiguous on its face.  The Ninth Circuit looked to the legislative history and statutory context to determine Congress’ intent.  The Court ultimately concluded that an ATDS is not limited to devices with the capacity to call numbers produced by a “random or sequential number generator” but also includes devices with the “capacity to dial stored numbers automatically.”
  • The Ninth Circuit’s interpretation is extremely expansive and possibly renders every smartphone user a potential TCPA violator.
  • The Ninth Circuit expressly distinguishes as “unpersuasive” the only other Court of Appeal decision on the issue, Dominguez v. Yahoo, in which the Third Circuit held that the statutory language requires the ability to randomly or sequentially generate phone numbers, not merely the ability to call from a database of numbers.