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Facebook’s Robocall Win at Supreme Court Signals Limit on Claims (1)

April 1, 2021, 5:15 PM; Updated: April 1, 2021, 7:36 PM

The U.S. Supreme Court’s narrow view of autodialers under federal anti-robocall law in a case involving unwanted texts from Facebook Inc. could shield other companies from expensive class actions over their contacts with consumers.

The decision is seen as a win for companies defending against a wave of lawsuits over robocalls. Companies including Home Depot Inc. and Quicken Loans LLC backed Facebook’s argument in the case.

Robocall claims tend to be directed more at the technology used to contact consumers, “not the content of those calls,” according to Richard Perr, chair of the consumer financial services practice at Kaufman Dolowich & Voluck LLP.

“Because they use a particular technology shouldn’t be the barrier,” Perr said. Companies shouldn’t be penalized for contacting consumers that they already have a business relationship with, he added.

The court ruled Thursday that Facebook’s system for texting users about unauthorized logins to their social media accounts doesn’t fit into the Telephone Consumer Protection Act’s definition of an autodialer.

The decades-old law was targeted at telemarketers that dial wide swaths of numbers at once, not companies like Facebook that send texts to specific numbers, according to the unanimous ruling.

Targeted Texts

Facebook sought Supreme Court review after an appeals court denied the company’s bid to toss the robotext lawsuit. The suit centers on account alerts sent to Noah Duguid, who took issue with the messaging because he wasn’t a Facebook user and hadn’t provided his number. Facebook said Duguid likely had a recycled number associated with another user.

Consumer advocates have warned of unleashing a flood of nuisance calls, if technology that dials numbers from a database is considered allowable.

“Many robocallers and would-be robocallers will interpret the Court’s decision today as essentially abrogating the autodialer restriction, which will likely lead to a surge in unwanted automated calls to cell phones,” Megan Iorio, counsel at the nonprofit Electronic Privacy Information Center, said in an email. EPIC submitted a brief in the case urging the Supreme Court to decide on a broad robocall ban, saying a narrowed definition wouldn’t protect people’s privacy.

The Supreme Court downplayed such concerns, saying its decision doesn’t impact the law’s general prohibition against calls using artificial or prerecorded voices. The ruling also noted that the texts at issue were individualized and meant for numbers linked to specific Facebook accounts.

“As the Court recognized, the law’s provisions were never intended to prohibit companies from sending targeted security notifications,” a Facebook spokeswoman said, adding that the decision will let companies continue working to keep user accounts safe.

The robocall law addressed random or sequential dialing, a method that most businesses or other organizations contacting consumers don’t use today. Instead, they often market to consumers using targeted lists, according to John Richer, a shareholder at law firm Hall Estill who specializes in the TCPA.

The Supreme Court’s ruling means businesses “text blasting” consumers at random will still have exposure to liability under the robocall law, Richer said. Those using targeted marketing should have an easier time shaking off consumer claims, he said.

Richer added that businesses using automated methods of contacting consumers should continue to obtain consent.

The case is Facebook Inc. v. Duguid, U.S., No. 19-511, decided 4/1/21.

(Updates with comment from EPIC.)

To contact the reporter on this story: Andrea Vittorio in Washington at avittorio@bloomberglaw.com

To contact the editors responsible for this story: Kibkabe Araya at karaya@bloomberglaw.com; Keith Perine at kperine@bloomberglaw.com

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