On April 1, 2021, the U.S. Supreme Court issued a decision in Facebook v. Duguid that ended a long division of opinion regarding the meaning of ‘autodialer’ under the Telephone Consumer Protection Act (TCPA). That term is defined in the TCPA as equipment with the capacity to ‘store or produce telephone numbers to be called, using a random or sequential number generator,’ and then to dial those numbers to deliver a prerecorded message to a residential phone line. Some U.S. Circuit courts, including the Ninth Circuit, in this case, had interpreted the definition to include devices that store and call numbers that the device did not generate. Compliance with the TCPA for telemarketing calls requires prior express written consent of the recipient.

The Supreme Court’s unanimous decision limits the definition by requiring the autodialer to use a random or sequential number generator in order to place calls. The Court noted that the Ninth Circuit’s interpretation would include virtually all modern phone systems, including cell phones, which did not appear to be the intent when the TCPA was passed.

Although this decision may not often affect residential mortgage loan originators, TCPA litigation has been one of the highest-volume litigation nationwide over the last several years. The certainty that this decision brings should serve to lower the plaintiff bar activity in this area.