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S.C. Broadly Interprets Cordless/Cell-Phone Privacy Act
Unanimous Court Says It’s Illegal for Participant to Secretly Record Conversation
By a MetNews Staff Writer
It’s crime to record a cellular or cordless telephone conversation without the consent of the other party, the California Supreme Court held yesterday, reversing a decision of the Court of Appeal which interpreted the governing statute as being restricted to surreptitious records by third parties.
Chief Justice Tani Cantil-Sakauye wrote for the unanimous court in disapproving the interpretation of Penal Code §632.7 by the Fourth District’s Div. Two. That section—which is contained in the Cordless and Cellular Radio Telephone Privacy Act of 1985, a subpart of the Invasion of Privacy Act—provides:
“(a) Every person who, without the consent of all parties to a communication, intercepts or receives and intentionally records, or assists in the interception or reception and intentional recordation of, a communication transmitted between two cellular radio telephones, a cellular radio telephone and a landline telephone, two cordless telephones, a cordless telephone and a landline telephone, or a cordless telephone and a cellular radio telephone, shall be punished by a fine not exceeding two thousand five hundred dollars ($2,500), or by imprisonment in a county jail not exceeding one year, or in the state prison, or by both that fine and imprisonment….”
Sec. 637.2 authorizes statutory damages and injunctive relief for violations.
Menetrez’s View
The Court of Appeal on Dec. 20, 2019, affirmed the dismissal of a putative class action brought by Jeremiah Smith against LoanMe, Inc. which, it was alleged, routinely recorded sales-pitch calls, without advising the person who answered the phone of the recording. Justice Frank J. Menetrez wrote:
“We conclude that section 632.7 prohibits only third party eavesdroppers from intentionally recording telephonic communications involving at least one cellular or cordless telephone. Conversely, section 632.7 does not prohibit the participants in a phone call from intentionally recording it. Consequently, Smith failed to state a claim against LoanMe under section 632.7.”
Menetrez explained:
“Section 632.7 imposes liability on any person ‘who, without the consent of all parties to a communication, intercepts or receives and intentionally records’ a communication involving a cellular phone or a cordless phone. The statute thus requires that the interception or receipt of the communication be without the parties’ consent. But the parties to a phone call always consent to the receipt of their communications by each other—that is what it means to be a party to the call (or at least that is part of what it means). In this case, for example, LoanMe consented to Smith’s receipt of LoanMe’s communications (‘Is Mrs. Smith there?’), and Smith consented to LoanMe’s receipt of Smith’s communications (‘No.’). Consequently, the parties to a phone call are incapable of violating section 632.7, because they do not intercept or receive each other’s communications without all parties’ consent.”
Supreme Court Opinion
Cantil-Sakauye noted that Menetrez’s opinion was the first one published by a California appellate court interpreting §632.7. However, federal district courts have construed the statute, and most have expressed a contrary understanding of its breadth, she said.
The “more plausible reading of section 632.7(a),” she declared, is that the “consent” element only refers to the recording of conversations, and that “the section’s ‘intercepts or receives’ phrasing specifying the circumstances in which a person may become privy to a covered communication,” the chief justice declared, adding:
“Under this interpretation of section 632.7(a), there is no doubt regarding its applicability to parties as well as nonparties to a communication.”
Acknowledging that the statute is not free from ambiguity, Cantil-Sakauye looked at its legislative history. AB 2465, which created the statute, she pointed out, was interpreted broadly by the Assembly Committee on Public Safety.
Its analysis, taking into account the prospect of blameless interception of messages in light of cordless and cellular phones using radio waves, says:
“The innocent, merely curious, or non-malicious interception of cellular or cordless telephone conversation will remain legal. However, it will be illegal to record the same conversations. Henceforth, persons using cellular or cordless telephones may do so knowing that their conversations are not being recorded.”
Cantil-Sakauye observed that the Legislature’s intent “would not be vindicated by an interpretation of section 632.7 as applicable only to recording by nonparties.”
Riverside Superior Court Judge Sharon J. Waters decided the case against Smith based on the sounding of a “beep” three seconds into the call he received and at 15 second intervals after that. That alerted Smith to the recording. She found, that by not hanging up, he consented to the recording.
The Court of Appeal, Cantil-Sakauye wrote, did not consider the beeping. Her opinion instructs it to do so on remand.
The case is Smith v. LoanMe, Inc., 2021 S.O.S. 1329.
Todd M. Friedman, Adrian R. Bacon and Thomas E. Wheeler of the Law Offices of Todd M. Friedman in Woodland Hills represented Smith. Michael R. Williams and Jared M. Toffer of the Irvine firm of Finlayson Toffer Roosevelt & Lilly were counsel for LoanMe.
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