In one of the first decisions evaluating Telephone Consumer Protection Act (TCPA) claims under the FCC’s recent omnibus TCPA order, the Northern District of California dismissed a putative class action lawsuit alleging that AOL violated the TCPA when users of its Instant Messenger service (AIM) sent text messages to incorrect recipients.  After the court dismissed the plaintiff’s original complaint, the FCC issued an omnibus TCPA order offering guidance on numerous issues, including the types of equipment subject to TCPA restrictions and the statute’s application to social app petitioners for text messages sent using their services.  On September 11, the court dismissed the plaintiff’s amended complaint with prejudice, concluding that the omnibus TCPA order reinforced prior FCC decisions that supported AOL’s arguments for dismissal.  (Covington represents AOL in this case.)  The decision undercuts the dire predictions in some quarters that the recent omnibus TCPA order would in every circumstance expand the scope of liability under the TCPA.

As interpreted by the FCC and courts, the TCPA prohibits the use of an automatic telephone dialing system (ATDS) to call or text a mobile phone for informational purposes without the prior express consent of the recipient.  However, equipment used to make calls or send text messages can only qualify as an ATDS if it operates “without human intervention.”  The plaintiff alleged that he had received instant messages from an AIM user that were intended for someone else as text messages on his mobile phone, as well as a “confirmation text” from AOL after he requested to block future messages from the errant sender.  In dismissing the initial complaint, the court held that the misdirected messages resulted from “human intervention” by the AIM user.  The court also held that existing FCC authority and a “common sense” approach to the TCPA allows for a confirmation text message to be sent in reply to a request for action.

In support of his amended complaint, the plaintiff had argued that the FCC’s omnibus order expanded the ATDS definition to cover any call made or text message sent using equipment with the alleged capacity to operate as an ATDS, even if this “potential” capacity was not used to place the call or send the text message in question.  The court soundly rejected the plaintiff’s sweeping interpretation, noting that the FCC’s omnibus order “does not eliminate the requirement that an autodialer under the TCPA operate without human intervention.”  The court also stated that the FCC’s omnibus order reaffirms that the TCPA permits consumer-friendly confirmation texts.

The amended complaint also alleged that AIM status updates were indicative of the use of an ATDS.  However, the court held that the plaintiff did not have standing to “pursue a TCPA claim based on [AIM] messages that plaintiff did not personally receive.”  The court also pointed out that the new allegations “only relate to users of AIM,” who would have consented to receive such messages.  Finally, the court found that AIM status updates result from the “human intervention” of users logging into or out of the AIM service, or sending the status messages themselves.

The court’s decision provides important clarity on the effect of the FCC’s recent omnibus order for social messaging services.

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Photo of Eric Bosset Eric Bosset

Eric Bosset is a partner whose practice encompasses a broad range of complex litigation matters, with an emphasis on (1) privacy, data security and consumer protection, (2) employment and ERISA, and (3) financial products and services. Eric has extensive experience in class actions…

Eric Bosset is a partner whose practice encompasses a broad range of complex litigation matters, with an emphasis on (1) privacy, data security and consumer protection, (2) employment and ERISA, and (3) financial products and services. Eric has extensive experience in class actions, MDL proceedings, and other multi-party lawsuits. His trial victories include a jury verdict in an employment class action lawsuit that The National Law Journal ranked among the 25 most notable defense verdicts of the year.

Privacy and Consumer Protection

Eric was named “Most Valuable Player” in Privacy & Consumer Protection by Law360. He has an extensive practice representing Internet service providers, publishers and advertisers in class action litigation involving claims of unauthorized collection and disclosure of personally identifiable information (“PII”). He has successfully represented Microsoft, AOL, CBS, McDonald’s, Mazda, the Indianapolis Colts, and other companies in obtaining the dismissals of putative class action lawsuits that asserted federal law claims under the Electronic Communications Privacy Act (“ECPA”), Computer Fraud and Abuse Act (“CFAA”), and Video Privacy Protection Act (“VPPA”), as well as state law claims under the Illinois Biometric Information Privacy Act (“BIPA”) and for unfair practices, trespass, and invasion of privacy.

Eric also represents companies in connection with matters arising under the Fair Credit Reporting Act (“FCRA”), Fair and Accurate Credit Transaction Act (“FACTA”), Telephone Consumer Protection Act (“TCPA”), and other consumer protection statutes.

Employment and ERISA

Eric has extensive experience defending companies in individual and class action litigation brought under federal and state laws concerning discrimination, retaliation, whistleblowing, wage and hour disputes, and wrongful termination, as well as in class action litigation involving the Employee Retirement Income Security Act (“ERISA”). Eric has the rare distinction of having tried and won a jury verdict in a class action lawsuit alleging “pattern or practice” discrimination on the basis of age in connection with a corporate reduction in force. Bush, et al. v. Deere & Company (C.D. Ill.). He also secured the reversal on appeal of a class certification order in a “stock drop” lawsuit that claimed breaches of fiduciary duty in the administration of a company retirement savings plan. In re Schering Plough Corporation ERISA Litig., 589 F.3d 585 (3d Cir. 2009). Eric also represents clients in EEOC investigations.

Financial and Fintech

Eric’s practice includes the representation of financial and fintech companies on a broad array of civil litigation, arbitration, and regulatory enforcement matters relating to financial products and services, including matters for Wells Fargo Bank, JPMorgan Chase, Synchrony Bank, Envestnet, Yodlee, and MidFirst Bank.

Photo of Caleb Skeath Caleb Skeath

Caleb Skeath advises clients on a broad range of privacy and data security issues, including regulatory inquiries from the Federal Trade Commission, data breach notification obligations, compliance with consumer protection laws, and state and federal laws regarding educational and financial privacy.