JOHN F. GRADY, District Judge.
Before the court is defendant Consumer Portfolio Services, Inc.'s ("CPS") motion for summary judgment. For the reasons explained below, we deny CPS's motion.
The named plaintiffs in this case, Roslyn Griffith and Jerret Cain, allege that they received unauthorized telephone calls and text messages on their cellular telephones from CPS, a sub-prime auto-finance lender.
The night before a dialing campaign begins, a computer program reviews account information for every CPS customer listed in the Customer Information File and identifies customers eligible for the dialing campaign using criteria selected by CPS. (Id. at ¶ 9; see also Gallagher Decl. ¶ 8 (stating that as a first cut CPS might, for example, use the program to identify all customers who are less than 60 days in arrears).) This same program then copies the account and telephone numbers of each eligible customer into a new temporary computer file called the "Dialer File." (Def.'s Stmt. ¶ 10.) On the day of the campaign, a supervisor in CPS's collections department inputs additional criteria for the dialing campaign into CPS's Collections System, "effectively telling the CPS Collection System which numbers the dialer should call." (Id. at ¶ 11; see also Clewell Decl. ¶ 7 ("The supervisor might decide, for example, that Illinois customers who owe $500 or more and are 21 to 30 days behind should be called during the campaign.").) The program then reviews the Dialer File for accounts that satisfy the criteria and copies those accounts and associated telephone numbers into a new file called the "Logical View File." (Def.'s Stmt. ¶ 13.) At the same time, the supervisor assigns certain CPS employees ("collectors") to the campaign, who then use the program to "`sign on' to the campaign so that they can `answer' the calls made by the Castel dialer that actually connect to consumers." (Id. at ¶ 14.) Once the dialing campaign begins, the Castel dialer "reads" the telephone numbers at the "predictive dialing rate" set by the supervisor. (Id. at ¶ 15.) ("Predictive dialing" software on the Collections System regulates the dialer's call rate to improve efficiency. (Gallagher Decl. ¶ 10; see also Def.'s Stmt. ¶ 12.)) The dialer determines whether a call is answered by a customer, and if so, routes the call back to CPS's computer system, which forwards the call to an available collector. (Def.'s Stmt. ¶ 16.) The customer's account information appears on the collector's computer screen as he or she receives the call. (Id.) While speaking with the customer, the collector enters data into the Customer Information File in the Collections System. (Id. at ¶ 17.) After the dialing campaign is completed, the Collections System prepares reports on the results of the dialing campaign. (Id.)
"The court shall grant summary judgment if the movant shows that there is no genuine dispute as to any material fact
The TCPA prohibits calls to certain telephone numbers, including cellular telephone numbers, using an "automatic telephone dialing system," except in an emergency or with the recipient's "prior express consent." 47 U.S.C. § 227(b)(1). As defined in the statute, an "automatic telephone dialing system" means "equipment that 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." 47 U.S.C. § 227(a)(1). The phrase "random or sequential number generator" is not defined. As we understand these terms, "random number generation" means random sequences of 10 digits, and "sequential number generation" means (for example) (111) 111-1111, (111) 111-1112, and so on. CPS's expert states that early dialers operated in this fashion, calling every conceivable telephone number. (Cutler Decl. ¶ 15.) More recently, companies like Castel have developed dialers that call lists of known telephone numbers — in this case, the telephone numbers of CPS's customers. (Id. at ¶ 16.)
In 2002, the FCC solicited comments concerning the TCPA's definition of an "automatic telephone dialing system." See In the Matter of Rules and Regulations Implementing the Telephone Consumer Protection Act of 1991, 17 FCC Rcd 17459, 17473-476 (September 18, 2002). The FCC acknowledged that autodialing technology had advanced. See id. at 17474 ("More sophisticated dialing systems, such as predictive dialers and other electronic hardware and software containing databases of telephone numbers, are now widely used by telemarketers to increase productivity and lower costs."). In light of that fact, it sought comments concerning "whether Congress intended the definition of `automatic telephone dialing system' to be broad enough to include any equipment that dials numbers automatically, either by producing 10-digit telephone numbers arbitrarily or generating them from a database of existing telephone numbers." Id. "Specifically, we ask whether a predictive dialer that dials telephone numbers using a computer database of numbers falls under the TCPA's restrictions on the use of autodialers." Id. at 17475. As CPS points out, several companies argued that predictive dialers fell outside the TCPA's scope because a list or database of actual customer telephone numbers is, by definition, not randomly or sequentially generated. See, e.g., Comments of the American Teleservices Ass'n, attached as Ex. C to Stone Decl., at 113 ("Predictive dialers do not generate `random' or `sequential' telephone numbers. Instead, they rely on telephone numbers from lists provided by the equipment operator. These lists are
The FCC effectively rejected these comments, concluding that "a predictive dialer falls within the meaning and statutory definition of `automatic telephone dialing equipment' and the intent of Congress." In the Matter of Rules and Regulations Implementing the Telephone Consumer Protection Act of 1991, 18 FCC Rcd 14014, 14093 (July 3, 2003). The technology had changed, but the basic function of such equipment — "the capacity to dial numbers without human intervention" — had not. Id. at 14092 (emphasis in original). The FCC went on to conclude that,
Id. at 14092-93. In 2008, in response to a request for clarification, the FCC "affirm[ed] that a predictive dialer constitutes an automatic telephone dialing system and is subject to the TCPA's restrictions on the use of autodialers." In the Matter of Rules and Regulations Implementing the Telephone Consumer Protection Act of 1991, 23 FCC Rcd 559, 566 (Jan. 4, 2008). The petitioner requesting clarification argued that "a predictive dialer meets the definition of autodialer only when it randomly or sequentially generates telephone numbers, not when it dials numbers from customer telephone lists." Id. The FCC rejected this interpretation, citing the policy considerations that guided its 2003 ruling. Id. at 566-67.
CPS acknowledges that the FCC's final orders are binding on this court under the Hobbs Act. See 28 U.S.C. § 2342(1); 47 U.S.C. § 402(a); CE Design Ltd. v. Prism Bus. Media, Inc., 606 F.3d 443, 446-50 (7th Cir.2010); (Def.'s Mem. at 10 n. 4). But it argues that the FCC's 2003 and 2008 orders are really quite narrow. According to CPS, to fall within the FCC's interpretation of an "automatic telephone dialing system" the equipment in question must have the technical ability to perform the now obsolete functions performed by dialers when Congress originally passed the TCPA. That is, it must be able to "store or produce numbers using a random or sequential number generator" and "dial numbers randomly or sequentially." (Def.'s Mem. at 10.) According to CPS's witnesses, the Castel dialer cannot perform these functions. (Cutler Decl. ¶¶ 19-20; Gallagher Decl. ¶ 16.) CPS's interpretation of the FCC's orders, which it supports by quoting portions of those orders out of context, is a transparent attempt to win through litigation a battle that other companies lost before the FCC.
Finally, we reject CPS's argument that the TCPA only applies to telemarketing, not debt collection. (Def.'s Mem. at 12; Def.'s Reply at 8-10.) Certain TCPA provisions apply only to "telephone solicitations," and consequently those provisions do not apply to debt-collection calls. In the Matter of Rules and Regulations Implementing the Telephone Consumer Protection Act of 1991, 23 FCC Rcd at 565. But § 227(b)(1)(A)(iii) — the provision that
CPS's motion for summary judgment (24) is denied. CPS's motion to strike the declaration of Randall Snyder (61) is denied as moot. We hold, as a matter of law, that CPS employs an "automatic telephone dialing system" to call its customers.