Consider the following: “It’s time to eat, Grandma!” versus “It’s time to eat Grandma!” Punctuation saves lives. It also potentially saved AT&T and Hilton many millions of dollars in two Telephone Consumer Protection Act (“TCPA”) suits.
Within the last month, the Seventh and Eleventh Circuit Courts of Appeal spilled more than 50 pages of ink on the interpretation of the statutory definition of an “automatic telephone dialing system” (“ATDS”) under the TCPA. Much of the analysis in both opinions focused on a single comma. The decisions are very well-written and entertaining, and while the grammar lessons in both are valuable, these opinions are most notable for illustrating the difficulties courts have interpreting statutory language that no longer makes sense due to changes in technology.
Congress enacted the TCPA in 1991 to combat unwanted telemarketing calls. Among other things, the law prohibits the use of an ATDS to call or text a cell phone without consent and is subject only to limited exceptions. Violations of the TCPA can be costly with statutory penalties of $500 per offending call or text, or up to $1,500 per call or text for a knowing or willful violation.
A lot has happened in the nearly 30 years since Congress passed the TCPA, including the introduction of cellular devices with functionality Congress could not have dreamed of in 1991. But much of the TCPA’s language remains unchanged. The outdated language leaves courts in the proverbial square peg, round hole situation when trying to interpret it. The result is a hyper-technical focus on grammar for evidence of some intent that makes sense in today’s world.
In both Glasser v. Hilton (11th Cir. Jan. 27, 2020) and Gadelhak v. AT&T (7th Cir. Feb. 19, 2020), the courts examined the definition of an ATDS. The TCPA defines an ATDS as: “equipment which 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.”
The Seventh and Eleventh Circuits analyzed whether “using a random or sequential number generator” modified both “store” and “produce.” After both courts considered many interpretations, they found that the comma after “called” necessitated the interpretation that “using a random or sequential number generator” modified both “store” and “produce.” The result was that AT&T’s and Hilton’s systems did not meet the definition of an ATDS because neither system used a random or sequential number generator to store or produce telephone numbers.
This interpretation substantially limits the applicability of the TCPA today because most companies no longer use a random or sequential number generator. But it made sense in 1991. As the court in Gadelhak pointed out, devices existed in 1991 that met the definition of an ATDS and were used to make telemarketing calls.
Both courts admitted that although the interpretation was not perfect, it was better than any of the alternatives. One possible alternative interpretation essentially results in every iPhone meeting the definition of an ATDS and potentially subjecting every iPhone-carrying American to the steep statutory penalties under the TCPA. The Ninth Circuit adopted this interpretation in 2018.
In Marks v. Crunch San Diego, the Ninth Circuit found that “using a random or sequential number generator” modified only “produce” and not “store.” Consequently, under this interpretation, any device with the capacity to store and dial numbers, like an iPhone, satisfies the definition of an ATDS. While the court considered the comma after “called,” albeit not in as much detail as the Seventh and Eleventh Circuits, it instead focused on the statutory scheme and original intent.
All three US Courts of Appeal concluded that the relevant statutory language was unclear on its face. As the Glasser court said “[c]larity, we lament, does not leap off this page of the U.S. Code.” And because the language does not work in the context of technology today, all three courts had to work hard to justify the result in each, with two courts reaching one conclusion and another reaching an opposite conclusion.
When there is a split in the circuits, a matter is ripe for US Supreme Court consideration. While the Supreme Court could expend additional effort dissecting the grammar and structure of the short phrase at issue, like the other courts, it would be stuck trying to jam the same square peg through the same round hole. At this juncture, only Congress can fashion a solution that fits within the present-day context.
The Need for Change
Most would welcome modernization of the TCPA, except possibly class action lawyers. The sharp increase in TCPA actions and sizable payouts over the past decade show that the class action lawyers are the only group that has benefited substantially from confusion caused by language that stopped making sense many years ago.
Congress, it’s time. In fact, it’s way overdue. In making changes to the TCPA, I offer the following advice to our lawmakers. First, when drafting legislation that addresses a specific technology, impose a sunset provision that forces the evaluation of the measure’s continued relevance and efficacy. Second, use a grammarian.
 I cannot take credit for this; I saw it on a mug once. I thought it was hilarious, but others did not find it as funny. Apparently, I’m a sucker for a good grammar joke.
 No. 18-1449 (11th Cir. Jan. 27, 2020). In Glasser, the plaintiff received about 13 calls about vacation opportunities over the course of a year.
 No. 19-1738 (7th Cir. Feb. 19, 2020). The plaintiff in Gadelhak received five customer survey text messages in Spanish. The plaintiff was not an AT&T customer and did not speak Spanish.
 47 U.S.C. § 227(a)(1).
 Gadelhak, p. 11.
 904 F.3d 1041 (9th Cir. 2018).
 Glasser, p. 7.
 To illustrate this point, we only need to look back one week to a rejected TCPA settlement. A federal court judge in Pennsylvania raised concerns about the “de minimums” recovery of individual class members and rejected a proposed TCPA settlement. Ward v. Flagship Credit, No. 17-2069. Under the proposed $4 million settlement, class members would collect only $35 each and the named plaintiff would receive a $10,000 incentive payment, while the lawyers would walk away with $1.3 million. Most TCPA resolutions have a similar structure. To be clear, in rejecting the settlement, the judge was focused entirely on the de minimums recovery by class members, the defendant’s ability to pay more and the amount of time and effort expended by the court.