Under the plain language of the Telephone Consumer Protection Act of 1991 (TCPA) and its regulations, only “residential telephone subscribers” have a right of action for violations of the do-not-call registry.¹ The issue becomes murky, though, when a number is used for both residential and business purposes. The Ninth Circuit recently addressed this question and concluded that there is no simple answer when determining whether a mixed-use line is “residential” but, instead, requires a fact-intensive inquiry into each individual number.²

In Chennette v. Porch.com, Inc., the plaintiffs were home improvement contractors that received unsolicited text messages from Porch.com and its subsidiary, GoSmith, offering potential customer leads. Fifteen of the plaintiffs had registered their numbers on the national do-not-call registry but still received 2,754 text messages on their registered numbers. The plaintiffs filed suit in the District of Idaho alleging violations of the TCPA based on the use of an automated telephone dialing system to send automated text messages³ and violations of the do-not-call registry. The defendants moved to dismiss, arguing, in part, that the plaintiffs lacked statutory standing because they used their phone numbers for both business and personal purposes.⁴ The district court dismissed the complaint, holding that the TCPA does not apply to the plaintiffs because the phone numbers were business lines.

The Ninth Circuit reversed the district court’s ruling. The court relied on a 2003 order in which the Federal Communications Commission (FCC) concluded that a cell phone registered on the do-not-call registry is “presumptively a residential phone.”⁵ Later, in a 2005 order, the FCC specifically declined to articulate a bright-line rule that numbers associated with home-based businesses would be excluded from the do-not-call provision, preferring to “review such calls as they are brought to our attention to determine whether or not the call was made to a residential subscriber.”⁶ The court noted that a majority of district courts, in light of the FCC’s guidance, have determined that a number used for both personal and business purposes can still be regarded as a residential line under the do-not-call provision.

Following the majority of district courts, the Ninth Circuit held that there is a presumption that a cell phone placed on the do-not-call registry is residential, but that the presumption can be rebutted on a case-by-case basis. The court remanded to the district court for further factual determination as to whether the plaintiffs’ lines were residential or business lines, and articulated several factors that the lower court should consider:

(1) whether plaintiffs have held out to the public or advertised their phone numbers for business purposes; (2) whether plaintiffs’ phones are registered with the telephone company as residential or business lines, including whether the phones are part of a family usage plan; (3) whether, and the extent to which, plaintiffs use their phones for business transactions or employment; (4) whether, and the extent to which, plaintiffs’ employers (or other business entities) pay for or reimburse plaintiffs for their phone bills.⁷

By explicitly affirming the fact-intensive nature of determining whether a line is residential or business, the Ninth Circuit’s decision has important implications for both individual and class action TCPA claims. In particular, the court’s decision provides additional support for defendants opposing class certification. To the extent that potential members of a class used their phone numbers for both business and personal purposes, the court’s decision reaffirms that an individual, fact-intensive inquiry is required to determine whether the do-not-call provisions would apply, thus showing that individual questions predominate over the common questions of law or fact and making class certification improper.

FOOTNOTES

[1] 47 U.S.C. § 227(c)(1) (directing the FCC to promulgate do-not-call regulations to “protect residential telephone subscribers’ privacy rights to avoid receiving telephone solicitations to which they object”); 47 C.F.R. § 64.1200(c)(2) (prohibiting telephone solicitation calls to “[a] residential telephone subscriber who has registered his or her telephone number on the national do-not-call registry”).

[2] Chennette v. Porch.com, Inc., — 4th –, 2022 WL 6884084 (9th Cir. Oct. 12, 2022).

[3] 47 U.S.C. § 227(b).

[4] The defendants also argued that the plaintiffs lacked Article III standing and statutory standing related to the autodialer claim. The court quickly rejected both arguments. The court held that, as to Article III standing, the receipt of unsolicited text messages was sufficient to establish a concrete injury. As to the statutory standing argument for the autodialer claim, the court held that the autodialer provision allowed for both persons and entities, which included businesses, such as the plaintiffs, to recover damages.

[5] Chennette, 2022 WL 6884084 at *5 (citing In re Rules and Regulations Implementing the Telephone Consumer Protection Act of 1991, 18 FCC Rcd. 14014 (F.C.C. 2003)).

[6] Id. (quoting In re Rules and Regulations Implementing the Telephone Consumer Protection Act of 1991, 20 FCC Rcd. 3788, 3793 (F.C.C. 2005)).

[7] Id. at *7.