King v. Time Warner Cable Inc.King v. Time Warner Cable Inc.
GERARD E. LYNCH, Circuit Judge:
Defendant-appellant Time Warner Cable Inc. (“Time Warner“) appeals a decision by the district court (Alvin K. Hellerstein, J.) granting partial summary judgment in favor of the plaintiff-appellee Araceli King on her claim that Time Warner knowingly or willfully violated the Telephone Consumer Protection Act of 1991 (“TCPA“),
BACKGROUND
I. The Telephone Consumer Protection Act
In the interest of reducing the volume of unwanted telemarketing calls, the Telephone Consumer Protection Act, in relevant part, makes it “unlawful . . . to make any call (other than a call made for emergency purposes or made with the prior express consent of the called party) using any automatic telephone dialing system . . . to any telephone number assigned to a . . . cellular telephone service, . . . unless such call is made solely to collect a debt owed to or guaranteed by the United States.”
The FCC has the authority to promulgate regulations implementing the TCPA.
II. Factual Background for King‘s TCPA Claims
King contends that Time Warner violated the TCPA by making numerous calls to her cell phone using an autodialer after she had withdrawn her consent for it to do so.1 During the period at issue in this lawsuit, King was a Time Warner customer. When signing up to receive services from Time Warner, King was required to agree to the company‘s terms of service, which included, in relevant part, granting the company permission to “call any number you provide to us (or that we issue to you) for any purpose,” provided, however, that a customer could request to be placed on a “do not call” list so as not to receive any further calls “for marketing purposes,” and that request would be honored. App. at 243. The terms of service agreement also specified that Time Warner “may use automated dialing systems or artificial or recorded voices to call” its customers. Id.
Beginning on July 3, 2013, Time Warner‘s system began making calls to a cell phone number belonging to King in an effort to collect on an overdue account. Unfortunately, King was not the customer Time Warner was seeking; instead, her phone number had erroneously been associated with the account of another, apparently delinquent, customer. King claims that, on October 3, 2013, after she had received ten calls from the system, she asked Time Warner to stop calling her number regarding the other customer‘s account. But the calls
In March 2014, King filed the instant suit, claiming that Time Warner‘s calls violated the TCPA. The parties cross-moved for summary judgment. Time Warner interpreted the term “capacity” in the TCPA‘s definition of an autodialer to mean that a device was “capable at the time of use” of performing the functions of an autodialer. App. at 265; see also id. at 266 (referring to a system‘s “present capacity“). Accordingly, it argued that, in the absence of any evidence that its system had the present ability to perform the requisite functions, its system could not qualify as an autodialer under the statute. The district court disagreed, because it adopted a broader understanding of the term “capacity.” Relying on a press release announcing the FCC‘s 2015 Order, which was not formally issued until a few days after the court‘s ruling, the district court
The court also concluded that although King‘s assent to the company‘s terms of service constituted blanket consent to receive calls from an autodialer, she effectively withdrew that consent on October 3, 2013. Accordingly, the court granted summary judgment to Time Warner as to the ten calls made before King withdrew her consent, and granted summary judgment to King as to the 153 calls made thereafter. The court further held that, because Time Warner had knowingly violated the statute, treble damages were warranted for each of the violating calls.
Time Warner filed the instant appeal.
III. The D.C. Circuit‘s Invalidation of the FCC‘s 2015 Order
While Time Warner‘s appeal was being briefed to this court, the United States Court of Appeals for the District of Columbia Circuit heard a challenge to the FCC‘s 2015 Order.3 In ACA International v. FCC, 885 F.3d 687 (D.C. Cir. 2018), that court decided in relevant part that the FCC‘s definition of “capacity” in the 2015 Order, which included a device‘s “potential functionalities” after modification, id. at 693–94, would allow the statute to extend well past what Congress intended, and that the 2015 Order therefore failed “the requirement of reasoned decisionmaking,” id. at 703.
DISCUSSION
The district court‘s order granting in part King‘s motion for summary judgment is reviewed de novo. See Reyes v. Lincoln Auto. Fin. Servs., 861 F.3d 51, 54 (2d Cir. 2017), as amended Aug. 21, 2017. As noted above, in concluding that Time Warner‘s calls to King violated the TCPA, the district court relied on the FCC‘s 2015 Order, which broadly construed the term “capacity” and thus extended the TCPA to reach any device that could be modified by software changes to perform the functions of an autodialer. In the wake of ACA International, which invalidated that Order and thereby removed any deference we might owe to the views the FCC expressed in it, we must decide independently whether the district court‘s broad understanding of the “capacity” a device must have in order to qualify as an ATDS under the TCPA is a supportable interpretation of the statute. We conclude that it is not. Although we are not bound by the D.C. Circuit‘s interpretation of the statute, we are persuaded by its demonstration that interpreting “capacity” to include a device‘s “potential functionalities” after some modifications extends the statute too far. Instead, we agree with the D.C. Circuit that the term “capacity” is best understood to refer to the functions a device is currently able to perform,
I. “Capacity”
As discussed above, to qualify as an ATDS under the TCPA, a device must have the “capacity” to perform the functions of an autodialer.
“Every exercise in statutory construction must begin with the words of the text.” Saks v. Franklin Covey Co., 316 F.3d 337, 345 (2d Cir. 2003). The words to be interpreted are not considered in isolation; rather, we “look[] to the statutory scheme as a whole and plac[e] the particular provision within the context of that statute.” Id. “If resorting to the plain text alone fails to resolve the question, we test the competing interpretations against both the statutory structure of the
A. The “Plain Meaning” of “Capacity”
Definitions of the word “capacity” from dictionaries contemporaneous with the passage of the TCPA do little to definitively rule in or rule out Time Warner‘s proposed interpretation.4 Some of those definitions invoke an abstract sense of potential — i.e., the capacity of mankind to make world-changing inventions, or the capacity of one person for “greatness.” Others aim at something more concrete and immediate — for instance, when one is looking to hire an employee with the capacity to perform certain engineering tasks, qualified applicants presumably will not include people who don‘t yet have an
Common sense suggests that legislation, which typically targets present social problems, would be aimed at devices that have the “capacity,” in that narrower sense, to cause the problem that is the subject of legislative concern, rather than addressing itself to the hazily defined universe of things that have only a theoretical potential to do so. That is so not least because a broader sweep is unnecessary to effect the legislators’ protective purpose: in the context of the TCPA, for instance, devices with only the theoretical potential to perform the functions of an autodialer must necessarily obtain that actual ability before they pose a concrete risk of causing the problems which the statute was enacted to prevent. Based on the plain meaning of the statutory text, therefore, we are inclined to adopt a narrower definition of “capacity” than the one the FCC endorsed in its 2015 Order.
B. The D.C. Circuit‘s Opinion
In ACA International, the D.C. Circuit rejected the FCC‘s broad interpretation of “capacity” as inconsistent with the legislative purposes behind the TCPA, and concluded, as do we, that a narrower definition would be
In reaching that conclusion, however, the D.C. Circuit did not unequivocally adopt the view of the petitioners in that case (and of Time Warner here) that the term “capacity” was clearly limited to a device‘s “present ability.”
whether equipment has the ‘capacity’ to perform the functions of an ATDS ultimately turns less on labels such as ‘present’ and ‘potential’ and more on considerations such as how much is required to enable the device to function as an autodialer: does it require the simple flipping of a switch, or does it require essentially a top-to-bottom reconstruction of the equipment?
Although the D.C. Circuit was deciding only whether the FCC‘s specific interpretation was a reasonable one, rather than announcing what that court itself deemed to be the best interpretation of the statute, its analysis informs our understanding of the statutory text. We view the D.C. Circuit‘s discussion as correctly drawing a distinction between a device that currently has features that enable it to perform the functions of an autodialer — whether or not those
C. Legislative History of “Capacity”
Finally, the TCPA‘s ambiguous legislative history regarding the use of the term “capacity” does not cast doubt on the interpretation of the term we derive
The House Committee on Energy and Commerce, which was responsible for reviewing and presenting in the first instance the bill that would become the TCPA, certainly recognized that the term “capacity” had some potential for expansiveness, and, indeed, seems to have selected the word partially on that basis. During the Committee‘s hearings, industry representatives expressed concern that the term “capacity” would allow the statute to reach too broadly and specifically advocated for the definition of an ATDS to focus instead on the actual “use” of a device. See Telemarketing Practices: Hearing before the Subcomm. on Telecomms. & Finance of the H. Comm. on Energy & Commerce on H.R. 628, H.R. 2131, & H.R. 2184, 101st Cong. 110–11 (1989) (letter from Tracy Mullin, Senior Vice President of Gov‘t Affairs, Nat‘l Retail Merchs. Ass‘n); see also Telemarketing/Privacy Issues: Hearing Before the Subcomm. on Telecomms. & Finance of the H. Comm. on Energy & Commerce on H.R. 1304 & H.R. 1305, 102d Cong. 107
The legislative history thus confirms what the language of the statute makes clear in any event: that the TCPA applies to calls from a device that can perform the functions of an autodialer, regardless of whether it has actually done so in a particular case.7 The history is less clear, however, about the issue here:
The House Committee‘s Report acknowledged concerns that the definition of an ATDS could potentially be read broadly to “cover the mere ownership of office computers which are capable, perhaps when used in conjunction with other equipment, of delivering automated messages.” H. Rep. No. 101-633, at 6. But instead of responding to those concerns by explicitly narrowing the definition, the Committee asserted that, even if such a broad reading prevailed, the statute would not regulate an unduly expansive category of equipment in any event, because the bill placed restrictions only on the “active ‘use’ [of an ATDS] to deliver automatically dialed prerecorded telephone solicitations without live operator intervention.” Id. at 6–7 (emphasis added).
The Committee‘s proposed solution was incomplete. The Committee apparently failed to consider that even the version of the bill then under consideration also prohibited the use of an ATDS “to make unsolicited calls . . . to any number assigned to a paging or cellular telephone service,” apparently
The legislative history thus provides no definitive assistance in resolving the issue before us, and it certainly tells us nothing that would foreclose what we view as the best interpretation of the term “capacity” in the context of this statute, which we believe is a narrower one focusing on a device‘s current functions.
In sum, we conclude that the term “capacity” in the TCPA‘s definition of a qualifying autodialer should be interpreted to refer to a device‘s current functions, absent any modifications to the device‘s hardware or software. That definition does not include every smartphone or computer that might be turned into an autodialer if properly reprogrammed, but does include devices whose autodialing features can be activated, as the D.C. Circuit suggested, by the equivalent of “the simple flipping of a switch.” ACA Int‘l, 885 F.3d at 696. Within those bounds, however, courts may need to investigate, on a case-by-case basis, how much is needed to activate a device‘s autodialing potential in order to determine whether it violates the TCPA.
Applying those principles in the present case, we conclude that the district court‘s grant of partial summary judgment relied on an incorrect interpretation of the statute that was in turn premised on deference to an FCC Order that is no longer valid. The record does not permit us to conclude, as a matter of law, that Time Warner‘s system has the requisite “capacity,” as we understand it, to meet the definition of an autodialer regulated by the TCPA. Nor does it permit us to conclude the opposite. On the present record, we do not know whether Time
II. Other Issues
The parties have raised several additional arguments that were not resolved by the prior district court order and that the court may need to consider on remand. First, Time Warner argues that the district court‘s reading of the statute would render its “random or sequential number generator” clause superfluous. The district court‘s ruling does not address that question. To the contrary, the district court stated that “[w]hether [Time Warner] actually dialed King‘s number randomly or from a list is irrelevant” because its system had the ”capacity to dial random or sequential numbers,” under the FCC‘s expanded definition of that term. App. at 304 (emphasis in original, internal quotation marks omitted). In ACA International, the D.C. Circuit noted that “the role of the phrase, ‘using a random or sequential number generator,’ has generated substantial questions over the years,” which the FCC‘s 2015 Order failed to conclusively resolve. 885 F.3d at 701. To the extent that applying the narrower
Second, Time Warner argues that the district court improperly relied on a “human involvement” standard that is not reflected in the statute. Appellant‘s Br. at 27. We note that the FCC expressly declined to adopt such a standard in its 2015 Order. See 2015 Order at 7976. And it is unclear whether the district court intended to present the lack of human involvement in Time Warner‘s calls to King as an alternative basis for its ruling because it cites no authority for reading that standard into the statute. Given those uncertainties, we venture no opinion on whether that lack of human involvement is a consideration relevant to King‘s claims.
In light of the technological complexities inherent in the application of the statute to different types of devices, software programs, and “systems,” and the lack of clarity in the record as to the precise mechanisms constituting the Time Warner system that produced the calls to King, it seems prudent to limit our pronouncements in this case. Accordingly, we hold only that the district court decision was in error because (1) that decision was, understandably, based on
CONCLUSION
For the reasons stated above, the judgment of the district court is VACATED, and the matter is REMANDED for further proceedings consistent with this opinion.