Friday was an absolutely world-changer in TCPAWorld.

Yes, we had the McKesson Supreme Court ruling that will literally cast everything we know about the federal TCPA into doubt—but there was a critical development at the state level that NO ONE is talking about. But your state law compliance Queen is.

And its all about Texas and autodialers.

Brace yourselves.

First, it has been a nice couple of years since Facebook was decided.

After an initial brush with uncertainty the majority rule for interpreting the TCPA’s ATDS definition has settled around the requirement that a system randomly produce phone numbers to be dialed. While this interpretation is somewhat at odds with the express language of the statute—and the Supreme Court’s ruling in Facebook –that seems to allow claims where a system merely uses an ROSNG to store numbers, the clear majority of courts will not read the TCPA so expansively.

This is great news, of course, for TCPA defendants and callers nationwide as the volume of TCPA ATDS cases has shrunk to nothingness even as the overall volume of TCPA class litigation spikes.

But in Texas a massive change just took place. The Texas state legislature has modified the state’s marketing law to massively expand the private right of action available to individuals who received unconsented calls.

Specifically, the state will now allow direct private litigation for calls made using an autodialer. And the definition adopted in Texas varies from the federal definition in a critical respect.

The TCPA defines ATDS as:

The term “automatic telephone dialing system” means equipment which has the capacity—

1. to store or produce telephone numbers to be called, using a random or sequential number generator; and
2. to dial such numbers.

The Texas law defines an ADAD as:

Equipment used for telephone solicitation or collection that can:
(A) store telephone numbers to be called or produce numbers to be called through use of a random or sequential number generator; and
(B) convey, alone or in conjunction with other equipment, a prerecorded or synthesized voice message to the number called without the use of a live operator.

Notice the difference in the phrasing in sub (A) for each statute. With the TCPA’s definition there is a comma that follows the phrase “store or produce telephone numbers to be called.” This critical comma was the lynchpin for the Supreme Court’s textualist approach to interpreting the statute in Facebook. The comma demonstrated the phrase “using a random or sequential number generator” modified both store and produce—meaning the Ninth Circuit had wrongly interpreted the statute in holding any system that stores numbers and can dial them automatically qualified as an ATDS. (See Marks v. Crunch.)

But look at the Texas statute!

There is no comma! Plus, the phrase is different. The fragment “Store telephone numbers to be called” is a complete phrase, unlike in the TCPA where only the word “store” appears prior to the phrase “produce telephone numbers.” The TCPA’s structure strongly implies the following restriction—use of ROSNG—modifies both verbs prior to the comma. But the Texas statute lacks that structure. Instead, the provision merely continues to reference the seemingly alternative act of “produc[ing] numbers to be called through use of a random or sequential number generator.”

Yikes.

To be clear the statute can be read either way. I can certainly imagine a court concluding the phrase ROSNG does modify both “store” and “produce” just as it does with the TCPA. But there is simply no denying the structure of the two phrases is different.

Adding to the mix, section B of the Texas statute does not reference dialing but rather the ability to use either a prerecorded or synthesized voice message to the number without the use of a live operator. The tight restriction in section B implies that mere number storage may be the predicate trigger for the application of Section A.

On the other hand, if mere storage is the predicate for section A, doesn’t that render the ROSNG provision redundant and unnecessary? Seems like that will be a defendant’s best argument moving forward.

Regardless, this change is simply massive and really increases the pressure on all marketers or collectors in Texas to make sure they are collecting consent for all outbound calls.