Collector- June 2018 - 50

IAP

CBE Group Defeats TCPA Claim Over
Its Proprietary Dialing System
In a case supported by ACA's Industry Advancement Program, a Nevada federal court found that the company's
application to dial calls, used in conjunction with LiveVox's equipment to connect calls, is not an ATDS under the TCPA.
By Karen Scheibe Eliason

T

he U.S. District Court for the
District of Nevada handed the
accounts receivable management
industry a significant win in April when
it ruled that ACA International member
The CBE Group Inc. did not violate the
Telephone Consumer Protection Act when
it placed a series of outbound calls to a
consumer's cell phone allegedly without her
consent in its effort to reach her to collect
the unpaid debt she owed to DirecTV.
The district court held that CBE was not
liable under the TCPA for such calls because
the Manual Clicker Application (MCA),
CBE's patent-pending web-based software
platform used to dial the consumer's cell
phone, paired with LiveVox Inc.'s cloudbased call connectivity pass-through system,

"ACA is encouraged by
the Marshall decision and
confident that judges,
regulators and industry
participants will look to
it as positive persuasive
authority for interpreting
what equipment
constitutes an ATDS
under the TCPA."
50

do not constitute an automatic telephone
dialing system (ATDS). ACA supported its
member's initiative to obtain an important,
potentially precedent-setting TCPA decision
positively impacting ACA's members and the
credit and collection industry by providing
Industry Advancement Funds to help defray
the cost of litigation.
In the case Marshall v. The CBE Group,
Inc., No. 16-02406, 2018 WL 1567852 (D.Nev.
March 30, 2018), DirecTV referred the
consumer's account to CBE for collection.
CBE placed 189 calls to the consumer over
a six-month period using CBE's proprietary
MCA to dial. In order for a number to be
called using the MCA, the MCA requires a
CBE agent to manually initiate the call by
clicking a "bull's-eye on a computer screen
... Once a CBE agent clicks the bulls-eye,
a call is passed through LiveVox's cloud
connecting a CBE agent with the person to
whom the call is placed."
After the consumer filed her complaint
against CBE alleging violations of the TCPA,
the Fair Debt Collection Practices Act
and the Nevada Deceptive Trade Practices
Act, the parties each moved for summary
judgment.
Granting in part CBE's motion for
summary judgment, the district court
concluded that CBE's "communications
infrastructure does not constitute an ATDS."
Relying on the U.S. Court of Appeals for
the District of Columbia Circuit's ruling in
ACA Int'l v. FCC, which explicitly rejected
the Federal Communication Commission's
unreasonably expansive interpretation
of which devices qualify as an ATDS, the
district court based its decision in Marshall
by adhering to the statute's clear language
that mandates "'the focus be on whether

the equipment has the capacity 'to store or
produce telephone numbers to be called,
using a random or sequential number
generator.'"
In doing so, the district court said that
the MCA, which initiated the calls, does not,
by itself, "qualify as an ATDS." The district
court also said that the LiveVox system used
in conjunction with the MCA, which system
has the ability to track calling information,
"does not have the capacity to operate as an
ATDS" because it is not capable of and does
not have the capacity to store or produce
numbers in a random or sequential order or
to dial numbers in such a manner.
As for the nationwide precedential effect
of the D.C. Circuit Court's ruling in ACA
Int'l, the district court summarily rejected
the consumer's argument that it is not
required to follow the decision in ACA Int'l.
The district court explained that "[t]he D.C.
Circuit's decision is binding on this Court
because appellate courts have exclusive
jurisdiction to determine the validity of all
FCC final orders and the Judicial Panel on
Multidistrict Litigation has consolidated
the various appeals in that case in the D.C.
Circuit."
And notwithstanding the district court's
well-reasoned explanation for why it is bound
by the ACA Int'l ruling, the district court
said that even if the 2015 FCC Order, as well
as the 2003 FCC Order, remained intact, it
would still find that "the MCA, in conjunction
with LiveVox, is not an ATDS" because the
"overwhelming weigh of authority applying
[the 'human intervention'] element hold that
'point-and-click' dialing systems, paired with
a cloud-based pass-through services, do not
constitute an ATDS as a matter of law in light
of the clicker agent's human intervention."

ACAINTERNATIONAL.ORG


http://www.ACAINTERNATIONAL.ORG

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