Minnesota District Court Holds Predictive Dialer Not ATDS Under TCPA And Defendant Not Liable For Prerecorded Messages To Reassigned Number Based On Prior Subscriber's Consent

Reassigned NumbersSteward v. Credit One Bank, N.A., No. 16-173 (PAM/ECW), 2018 WL 5921652 (D. Minn. Nov. 13, 2018)

By: Joshua H. Threadcraft

Plaintiff filed suit alleging Defendant violated the TCPA by calling his recently assigned cell phone number 140 times to collect debt from another, including leaving 4 prerecorded messages. Defendant moved for summary judgment arguing that: (1) Its phone system was not an Automatic Telephone Dialing System (ATDS); and (2) It was reasonable to rely on consent from the previous subscriber when calling Plaintiff.

With respect to the first issue, plaintiff argued that because Defendant's phone system used a predictive dialer, it was an ATDS pursuant to 2003 and 2008 FCC Declaratory Rulings. The Court disagreed, stating:

The D.C. Circuit, in fact, rejected this very argument. "According to the [FCC], because there was no timely appeal from [the 2003 and 2008 rulings], it is too late now to raise a challenge by seeking review of a more recent declaratory ruling that essentially ratifies the previous ones. We disagree. Here there is no question that the devices used by [Defendant's] agents are predictive dialing systems. However, in the wake of ACA Int'l, predictive dialing systems are no longer always considered autodialers under the TCPA. Rather, the correct inquiry is whether a device can generate numbers to dial either randomly or sequentially. [Defendant's] "limited understanding of the proprietary dialing systems employed by the vendors is that none of those systems has the actual capability of randomly/sequentially generating numbers to dial," and "the vendors have worked diligently to ensure that their dialing systems do not have such capabilities [. . .] In sum, [Plaintiff] has failed to show that there is a genuine issue of material fact regarding the required functionality of [Defendant's] dialing system.

Moving next to Defendant's argument regarding prerecorded messages, the Court recognized that the TCPA makes it unlawful to use an artificial or prerecorded voice to place a call to cell numbers without prior express consent. The Court also recognized that the FCC has interpreted the statutory term "called party" as the current subscriber of the cell number, not the intended recipient of the call. But the decision in ACA Int'l, "invalidated a portion of the FCC ruling that allowed for a one-call 'safe harbor' rule for reassigned numbers and 'set aside the Commission's treatment of reassigned numbers as a whole.'" Thus, "to determine whether there has been a violation of this section of the TCPA under current authority, the Court must consider the reasonableness of the caller's reliance on a prior number holder's express consent."

Noting that Defendant had express consent from its customer, the prior subscriber, to call him using prerecorded messages, the Court stated that, under the circumstances, "[i]t was reasonable for [Defendant] to rely on [the previous subscriber's consent] to call his number and therefore, summary judgment on this issue was proper."

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