Federal Judge Issues Positive TCPA Ruling; Potential Capacity in ATDS Not Enough for Violation

A federal district judge in California last week granted summary judgment to the defendant in a TCPA case that hinged on whether the company was using an “automatic telephone dialing system” (ATDS) under the statute. While not an ARM industry case, the ruling explores present vs. potential capacity in an ATDS.

The case, Glauser v. GroupMe, involved the use of a group messaging application to send out many text messages to separate cell numbers, GroupMe’s core business offering. The application allows users to create groups and to transmit texts to all members of that group simultaneously.

On or about April 23, 2011, plaintiff Brian Glauser received a text message that read: “Hi Brian Glauser, it’s Mike L. Welcome to GroupMe! I just added you to “Poker” w/Richard L. Text back to join the conversation.” He then received another welcome text from the GroupMe application.

Glauser received several texts from other members of the group, including ones discussing plans for scheduling a poker game. He never responded to any of the text messages.

Glauser then filed suit asserting a claim under the TCPA against GroupMe. The plaintiff said that the welcome texts sent by GroupMe were a violation. On January 27, 2012, the case was stayed pending FCC decisions on three issues: (1) the definition of an “automatic telephone dialing system” under the TCPA, (2) whether prior express consent could be received through an intermediary, and (3) the scope of the TCPA’s “common carrier” exemption.

The court lifted the stay on March 27, 2014, after receiving no indication that any FCC action was forthcoming.

GroupMe moved for summary judgment on the grounds that the platform it used to send text messages does not qualify as an ATDS under the TCPA because it lacks the capacity to function as an ATDS. Glauser countered that a device that has the “potential capacity” to function as an ATDS qualifies as an ATDS under the TCPA, even if the device was not actually used as an ATDS in sending the message at issue.

District Judge Phyllis J. Hamilton, in the Northern District of California, held that there was a distinction between the issues of “present vs. potential capacity” and “capacity vs. actual use.”

Finding that GroupMe’s system did not have the capacity to send the messages, “without human intervention,” she wrote “the relevant inquiry under the TCPA is whether a defendant’s equipment has the present capacity to perform autodialing functions, even if those functions were not actually used.”

Hamilton granted summary judgment in favor of GroupMe.