In Duguid v. Facebook, Inc., No. 17-15320, 2019 U.S. App. LEXIS 17675 (9th Cir. June 13, 2019), the Court of Appeals for the Ninth Circuit again addressed its prior decision in Marks on the subject of what constitutes use of an ATDS under the TCPA. Ruling on an appeal from a motion to dismiss, the Ninth Circuit Court of Appeals held that the non-customer plaintiff sufficiently pleaded the use of an ATDS. The Court began by recalling its ruling in Marks v. Crunch San Diego, LLC, 904 F.3d 1041, 1049-50, 1053 (9th Cir. 2018), wherein it “rearticulated” the definition of an ATDS as “equipment which has the capacity (1) to store numbers to be called or (2) to produce numbers to be called, using a random or sequential number generator and to dial such numbers automatically.” Duguid at *5. The key being that—in the court’s view—“using a random or sequential number generator” only modifies “to produce numbers” and not “to store numbers.” The Court did not veer from this interpretation. Specifically:
Duguid’s nonconclusory allegations plausibly suggest that Facebook’s equipment falls within this definition. He alleges that Facebook maintains a database of phone numbers and explains how Facebook programs its equipment to automatically generate messages to those stored numbers. The amended complaint explains in detail how Facebook automates even the aspects of the messages that appear personalized. Those factual allegations, accepted as true and construed in the light most favorable to Duguid, sufficiently plead that Facebook sent Duguid messages using “equipment which has the capacity . . . to store numbers to be called . . . and to dial such numbers.”
Duguid at *9. Facebook tried to draw a distinction between numbers stored to be called independently by Facebook and numbers stored only for responsive messages. Id. at *10-11. The Court rejected this argument saying that it “cannot square this construction with Marks.” Id. at * 11. Additionally, given the plaintiff’s non-customer status and his repeated notification to Facebook of that fact, the court found the calls “fall outside even the broad construction the FCC has afforded the emergency exception.” Id. at * 13.
Finally, the court held that Facebook’s challenge to the constitutionality of the entire TCPA based on the content-based exemption of calls solely to collect debts owed to or guaranteed by the United States also failed. Id. at *25. Under strict scrutiny, the court held that “the debt-collection exception is content-based and insufficiently tailored to advance the government’s interests in protecting privacy or the public fisc.” Duguid at *23. Though the court held that Facebook was right that the exemption is unconstitutional under the First Amendment, the result was that the court severed and struck down the exemption, not the entire TCPA. See also Am. Ass’n of Political Consultants, Inc. v. FCC (4th Cir. 2019) 923 F.3d 159.