Court Finds That System Is Not An ATDS Unless It Can Generate (As Opposed To Merely Dial) Numbers On A Random Or Sequential Basis

Judge Baylson of the Eastern District of Pennsylvania recently granted Yahoo! summary judgment in a case challenging Yahoo's automatic email to text alert system because it did not use an automatic telephone dialing system ("ATDS") when it forwarded emails as text messages. In doing so, he applied the plain meaning of the statutory definition of ATDS, rejected an FCC opinion that had purported to broaden it, and disagreed with Judge Curiel in the Southern District of California, who denied a similar motion by Yahoo! just weeks ago. See Dominguez v. Yahoo!, Inc., No. 13-1887, slip op. (E.D. Pa. Mar. 20, 2014); Sherman v, Yahoo!, Inc., No. 13-0041, slip op. (S.D. Cal. Feb. 3, 2014). The decision is important because it limits the definition of ATDS to those systems that can generate (as opposed to merely dial) a list of numbers on a "random or sequential" basis.

Plaintiff Bill Dominguez alleged that Yahoo! used an ATDS to send thousands of unsolicited text messages (nearly 50 to 60 per day for many months) to his cell phone. The text messages were part of a Yahoo! service that allowed account holders to have incoming email messages automatically converted into a truncated format and forwarded to cell phones as text messages. One such account holder was Jose Gonzalez, who neglected to disable or update the service after his cell phone number was reassigned to Mr. Dominguez. Uninterested in Mr. Gonzalez's emails, Mr. Dominguez contacted Yahoo!, which told him that the service could only be stopped if the Yahoo! account holder (Mr. Gonzalez) disabled it himself. Mr. Dominguez then filed suit. (Whether he or Yahoo! ever tried to contact Mr. Gonzalez is not clear from the court's opinion.)

Yahoo! moved for summary judgment and argued that the text messages: (1) were not sent using an ATDS and, even if they had been, (2) were not the sort of unsolicited telemarketing that the TCPA was meant to prohibit in the first place.

The parties assumed that text messages constitute "calls" under the TCPA,1 and agreed that the challenged service "automatically converted email messages into a truncated format, accessed the appropriate user's telephone number from a stored list, and automatically sent the text message to the customer's mobile device." Dominguez, slip op. at 7-8. They disagreed, however, about whether the service used an ATDS. See 47 U.S.C. § 227(a)(1) ("The term 'automatic telephone dialing system' means equipment which has the capacity(A) to...