Call of the Scams: How Facebook v. Duguid Opens the Door for Spam Calls and Texts

In Litigation, Supreme Court by Kris CoombsLeave a Comment

There are several privacy issues on the internet through data breaches and unwanted communications, and Facebook is no exception having had its own share of problems over the past several years. Facebook is no stranger to litigation as a result of its (mis)handling of customers’ privacy. One recent case, Facebook v. Duguid, focuses on how Facebook collects and uses users’ phone numbers. Oral arguments were heard on December 8, 2020, and the Supreme Court of the United States (SCOTUS) reached their decision on April 1, 2021 (and no, it was no joke and no laughing matter). SCOTUS landed a decision, siding with Facebook and ruling that Facebook’s gathering and use of telephone numbers did not violate the Telephone Consumer Protection Act (TCPA) of 1991. 

But, what’s actually going on here, and why does it matter? First, a quick bit of history.

Congress passed the Telephonic Consumer Protection Act (TCPA) in 1991 with the goal of banning automated calls to cell phones except 1.) in emergencies (e.g. life/death, crime notices, etc.) or 2.) with prior consent (e.g. checking a box on a form). In 2015, however, Congress added a third exception: automated calls to cell phones to collect debts secured by the government. This exception did NOT extend to private entities calling for debts they, themselves, had secured. This graphic by Business Insider shows how the process works:

Under the TCPA, automated calls are made by “automatic telephone dialing systems (ATDS). The TCPA defines “automatic telephone dialing system” (ATDS) as “equipment which has the capacity—(A) to store or produce telephone numbers to be called, using a random or sequential number generator; and (B) to dial such numbers.” Part A really needs to be broken down into subparts.

First, an ATDS is able to store numbers to be called. Second, an ATDS can produce numbers to be called. This production of a phone number can happen through a random number generator where the system randomly puts in a random combination of phone numbers, usually one number at a time for each of the 10 digits that make up a phone number. The production of a phone number can also be through a sequential number generator, where the system starts with a 10-digit telephone number and continuously increases that phone number by 1 in the last digit. 

As would be expected, a flurry of lawsuits ensued . According to WebRecon’s data on TCPA complaints, TCPA federal lawsuits drastically rose from 3,711 plaintiffs represented in 2015 to a whopping 4,770, the highest number from 2010 until now. 

In one such case, Marks vs. Crunch San Diego (2018), the Court of Appeals for the 9th Circuit overturned a district court ruling that granted summary judgment in favor of the defendant, Crunch San Diego. In the opinion, the definition of ATDS was clarified to include systems that could automatically dial stored numbers, regardless of whether the system could generate them; thus the court found in favor of the plaintiff. 

In numerous other cases, including Gallion v. Charter Communications (2020) and Barr v. American Association of Political Consultants (2020)–itself preceded by Am. Ass’n of Political Consultants v. Sessions and Am. Ass’n of Political Consultants v. FCC–courts grappled with the constitutionality of the TCPA. Many corporations argued that the third exception rendered it a constitutional violation as it was a “content-based” restriction. That is, it regulated communication (here, phone calls) based on the content of the calls (such as advertisements and debt collection). Ultimately, courts stated that the third exception was severable from the rest of the TCPA. As such, the TCPA itself was constitutional and would remain in effect, protecting the rights of consumers.

Why is this issue so important? Robocalls are both very costly to Americans and constitute an invasion of privacy. In 2019 alone, Americans were hit with over 58 billion robocalls. Although 2020 saw the total number of robocalls decrease to 46 billion, the average number of text messages increased.

Even outside of the daily intrusion into one’s lives, these calls have a financial impact as well. In 2014, spam calls cost American small businesses over $500 million, and the cost per year continues to climb. In 2019, scams cost Americans $10 billion, with 43 million people losing an average of $244. In 2020, even with the decrease in the amount of calls Americans lost $20 billion, with 56 million Americans losing money at the average cost of $351. In other words, more Americans were falling prey even as the number of calls decreased

As if that weren’t enough, year-to-date Americans have already reached 18 billion calls. In April 2021 alone, YouMail has tracked 4.4 billion calls. This translates into 147.6 million calls per day, all the way down to 1.7K calls per second. And who is doing the calling?

Given all of this, Congress has had good reason to maintain the TCPA, as without that piece of legislation, the number of robocalls would dramatically increase. But what does this have to do with the Facebook case?

In Duguid v. Facebook (2021), Duguid sued Facebook for automatically sending him text messages about an unrecognized browser attempting to access his Facebook account. However, Duguid never had a Facebook account, and it wasn’t clear how Facebook obtained his number. Despite his best attempts to stop the texts, he ultimately filed suit. 

Duguid argued Facebook violated the TCPA. Facebook argued that they never “called”, and even if they did, their communications fell under the “emergency exception” rule. However, the lower courts decided that it is generally legally agreed upon that text messages are included within the term “call” as construed by the TCPA. Additionally, even if Facebook fell under the “emergency exception” rule, Duguid was never a customer and thus, that exception would not apply in this case. 

SCOTUS’s decision could be considered a grammatical one, as the interpretation depended largely on how one was to read the lone comma in part (A). Essentially, the court found that under the TCPA, an ATDS must either 1) store telephone numbers using a random or sequential number generator, OR 2) produce telephone numbers using a random or sequential number generator. Based on SCOTUS’ reading, then, the defining feature of an ATDS is rooted in its ability to randomly/sequentially and automatically generate numbers, rather than its ability to randomly and automatically call numbers. Thus, Facebook is off the hook for now, since their technology only stores–rather than produces–numbers which it can automatically call or text. 

So what does this mean for Americans? The case decision is but a month old, but consumer advocacy groups are already concerned that the number of robocalls and texts will dramatically increase, as telemarketing and advertising companies can now expand the technology they use to make mostly unwanted telephonic contact. Based on the above statistics and the already annually increasing number of robocalls, we can expect to see more Americans receiving more robocalls, most of which will fall into the “scam” and “telemarketing” categories. 

About 61% of Americans are already worried they will miss an important call due to robocalls, even as 87% try to only answer calls they recognize. As the number of calls increases as the likely result of this ruling, Americans may increasingly worry they will miss important calls and receive even more spam texts. What started as an issue of being automatically contacted by a service to report a suspicious log-in–generally seen as a useful feature by those who actually have the service–led to a dramatic altering of the legal landscape for who, what, when, where, why, and how automated calls can be made.

For now, I plan to put my phone aside during dinner, stick with answering calls from friends and acquaintances, and not believe a single thing anyone I don’t know tells me over the phone or in a text. 

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