8th Circuit: Text Marketing System Not ATDS Under TCPA | PC Weiner Brodsky Kider

On March 24, 2022, the United States Court of Appeals for the Eighth Circuit issued an opinion determine whether an automated promotional SMS marketing system that sent messages to randomly selected, manually entered telephone numbers qualified as an automatic telephone dialing system (ATDS) under the TCPA. The Eighth Circuit concluded that because the automated marketing system did not “produce” telephone numbers to call, it could not be called an ATDS.

The individual appellants in the case had received promotional text messages from the respondent’s bar establishments. The callers claimed that these text messages violated the TCPA because they were sent by an ATDS without the callers’ consent. The respondents sent the text messages through a marketing software platform, and the issue before the court was whether that software qualified as ATDS under the TCPA.

The Eighth Circuit ruled that the marketing software did not fall within the TCPA’s ATDS definition after a detailed analysis of the software’s function, concluding that the marketing software did not generate phone numbers. Focusing its analysis on the functionality of the software, the Eighth Circuit noted that the software maintained a database of contact details of former and potential clients of the respondents which were entered manually. Because of this distinction between manual input and system generation, the Eighth Circuit found that the system did not “generate phone numbers to call”.

The Eighth Circuit also analyzed the U.S. Supreme Court’s decision in Facebook v Duguid, 141 S.Ct. 1163 (2021). The Eighth Circuit estimated that Facebook serves to limit the application of the term ATDS by “excluding[ing] equipment that we don’t[e] a random or sequential number generator. Considering Facebookthe Eighth Circuit explained that the marketing software in question “is exactly the type of equipment Facebook excluded from § 227(a)(1) – “equipment that merely stores and dials telephone numbers.” »