This article was originally published in Venable's All About Advertising Law Blog.
On February 4, 2015, in Glauser v. GroupMe, Inc., No. 4:11-cv-02584, the U.S. District Court for the Northern District of California struck a blow to class action plaintiffs asserting claims under the Telephone Consumer Protection Act ("TCPA"), interpreting the TCPA's definition of "automatic telephone dialing system" ("ATDS") narrowly to mean equipment that has the "present capacity" – as opposed to "potential capacity" – to perform autodialing functions.
In GroupMe, the plaintiff received several text messages that were sent through GroupMe's group messaging application, which allows users to create a "group" of personal contacts and transmit text messages to all members of the group at the same time. One of the plaintiff's friends had created a group and sent a text to the group members seeking to arrange a poker game; group members, in turn, began responding via text message to all other members about the game through GroupMe's platform. After receiving these messages, in May 2011, the plaintiff filed a putative class action, alleging that GroupMe violated the TCPA by sending text messages using an ATDS without his prior express consent. The TCPA defines ATDS as equipment that "has the capacity (A) to store or produce telephone numbers to be called, using a random or sequential number generator; and (B) to dial such numbers."
GroupMe moved for summary judgment on grounds that its messaging platform does not constitute an ATDS under the TCPA because it lacks the "present capacity" to function as a prohibited autodialer. In opposition, the plaintiff argued that messaging or dialing technology that has the "potential capacity" to function as an ATDS qualifies as an autodialer under the TCPA, even though the device is not actually used as an ATDS at the time of the offending text or call. The court rejected the plaintiff’s argument and distinguished Ninth Circuit authority that previously held that dialing equipment could qualify as an ATDS when it merely had the "capacity" to serve as an ATDS, even though it was not being used in such a manner. The court noted that, were it to accept the plaintiff's argument, many "run of the mill" devices, such as smartphones, could be misconstrued as an ATDS under the TCPA. The court's analysis focused on the distinction between the dialer's present and potential capacity to be used as an ATDS – "the relevant inquiry under the TCPA is whether a defendant's equipment has the present capacity to perform autodialing functions, even if those functions were not actually used." Finally, the court held that GroupMe's platform did not have the capacity to send text messages “without human intervention," another essential element of an ATDS according to FCC interpretations of the TCPA, because the text messages were sent "in direct response to the intervention" of the plaintiff's friend.
GroupMe is an important decision because many telemarketers use technology, such as preview dialers and dialing/messaging platforms, that, theoretically, could have the capacity to place autodialed calls, but such functionality has been disabled. In those cases, some level of human "intervention" occurs to place calls or send text messages, and GroupMe supports a finding that such technologies do not constitute ATDSs under the TCPA. It bears noting, however, that the "present vs. potential capacity" issue is the subject of several petitions pending before the FCC and telemarketers should continue to monitor the Federal Communication Commission's docket for the agency's conclusions.