South Carolina District Court Grants Summary Judgment for TCPA Defendant after Supreme Court's Duguid Decision


A South Carolina federal district court recently granted summary judgment for a TCPA defendant in one of the first major lower court decisions following the Supreme Court's opinion in Facebook v. Duguid, which clarified (and narrowed) the definition of an "automatic telephone dialing system," or "ATDS," under the TCPA. In Timms v. USAA Federal Savings Bank, the plaintiff claimed that USAA called her excessively using an ATDS to "harass" her about delinquent credit card accounts. However, the district court found that USAA's dialing equipment—Aspect Unified IP ("Aspect UIP") and Aspect Agent Initiated Contact ("Aspect AIC")—did not violate the TCPA because it did not meet the narrowed definition of an ATDS clarified by the Supreme Court in Duguid, which held "that a necessary feature of an autodialer under [the TCPA] is the capacity to use a random or sequential number generator to either store or produce phone numbers to be called." 141 S. Ct. 1163, 1173 (2021) (emphasis added).

The record evidence established that USAA's dialing systems worked as follows: (1) "Telephone numbers of all [USAA] members are stored in the Aspect Advanced List Management ('ALM')"; (2) "Each day, [a USAA] representative identifies accounts he or she wishes to call the next day based on different criteria, such as 'account is overlimit, the period of delinquency, [or] the amount of debt'"; (3) "ALM creates a list of telephone numbers for members matching those criteria"; (4) "The numbers are then transferred to Aspect UIP or Aspect AIC"; (5) "Numbers are dialed from those pre-created lists"; (6) "If the Aspect UIP system is used, the Aspect UIP system dials the numbers" and "[i]f a person answers, the call is connected to a live representative"; and (7) "If the Aspect AIC system is used, the [USAA] representative initiates the call to a specific number on the list." Based on this evidence, the district court concluded that neither of USAA's dialing systems "store[s] or produce[s] telephone numbers using a random or sequential number generator," and therefore they did not qualify as an ATDS. Thus, there was no TCPA violation.

The plaintiff in Timms argued that Aspect UIP qualified as an ATDS because it "dials numbers automatically without the assistance of an agent," but the district court rejected that argument, stating that, "[a]s we learned from Duguid, the automatic dialing capability alone is not enough to qualify a system as an ATDS." Instead, the court explained, the system "must store numbers using a random or sequential number generator or produce numbers using a random or sequential number generator to qualify as an ATDS." The plaintiff also argued that Aspect UIP was an ATDS because it had a "predictive mode" in which "calls are made using an algorithm that predicts when an agent will be available to take the call." The district court rejected that argument too, holding that the fact that a system "can automatically dial numbers on a preset list based on the number of agents available is not evidence that [it] stores or produces telephone numbers using a random or sequential number generator."

Finally, the plaintiff, relying on a footnote in the Duguid opinion, argued that "even though the Aspect UIP was using a stored list of numbers that were not randomly generated, it can still qualify as an ATDS if it 'use[d] a random number generator to determine the order in which to pick phone numbers from a preproduced list.'" The court rejected this argument for several reasons: (1) there was no evidence that Aspect UIP "operates in that manner"; (2) the plaintiff repeatedly took the position in her briefs that USAA's ALM generated numbers to be called "in sequential order," meaning Aspect UIP was not using a random number generator; and (3) the plaintiff's reliance on the Duguid footnote was out of context and irrelevant because that footnote was specifically addressing dialing equipment from 1988 far different from USAA's.

While the Timms decision had to await a fully developed record at summary judgment (and is thus not a silver bullet at the pleading stage), the court's well-reasoned decision is a positive development for businesses nationwide, particularly those operating in the Fourth Circuit. As more cases like Timms are handed down post-Duguid, we may see a gradual chipping away at the number of abusive TCPA lawsuits filed against businesses across the country.