The Evolving Landscape of Tcpa Consent Standards and Ways to Minimize Risk

• Jurisdiction: United States,Federal
• Publication year: 2014
• Citation: Vol. 10 No. 1

Washington Journal of Law, Technology and Arts Volume 10, Issue 1 Summer 2014

The Evolving Landscape of TCPA Consent Standards and Ways to Minimize Risk

Misa K. Bretschneider(fn*)© Misa K. Bretschneider

ABSTRACT

Given the exponential growth in mobile phone usage, more businesses are adopting mobile communication strategies to engage with existing and potential customers. With 97% of all mobile marketing text messages being opened by their intended recipients, mobile text message marketing is both effective and lucrative. However, businesses must ensure that such messages comply with the Telephone Consumer Protection Act (TCPA), which generally prohibits sending unsolicited commercial text messages. Indeed, TCPA litigation has become the recent darling of class action lawyers due to uncapped statutory damages and is sure to increase with the heightened consent regulations promulgated by the Federal Communications Commission (FCC), effective October 16, 2013. However, businesses cannot escape liability simply by obtaining prior express consent, as more businesses are being forced into multi-million dollar settlements for exceeding the scope of consent granted by their mobile customers. This Article examines recent trends in how the FCC and the courts are delineating the contours of consent for mobile text messaging under the TCPA and provides ways businesses can engage with mobile customers without running afoul of the TCPA.

TABLE OF CONTENTS

Introduction ...................................................................................... 2

I. The Telephone Consumer Protection Act ................................. 3

II. Delineating the Scope of Consent ............................................. 6

A. 2014 FCC Rulings ............................................................... 6

B. 2014 Court Rulings .............................................................. 8

III. Mobile Communications Outside the Scope of Consent ........ 11

A. Language in Disclosure Documents .................................. 12

B. Purpose and Timing of Text Messages .............................. 13

C. Third Party Affiliates ......................................................... 14

Conclusion ..................................................................................... 15

Practice Pointers ............................................................................. 16

INTRODUCTION

2014 is shaping up to be an explosive year in Telephone Consumer Protection Act (TCPA) mobile text messaging litigation. Recently, the Buffalo Bills NFL team approved a $3 million settlement for sending three too many text messages to the team's mobile subscribers over a two-week period in violation of the TCPA.(fn1) The takeaway message is clear: businesses and their counsel need to be vigilant about TCPA compliance and ensure that all mobile text communications fall within the scope of consent provided by the customer.(fn2) However, the available guidance is far from clear, given that the TCPA is silent as to what forms of mobile communications are permissible.(fn3) For instance, if a customer consents to participating in a text-based social network, can the network then send the customer an administrative text message confirming the customer's interest without violating the TCPA?(fn4)

In recent years, the FCC and the courts are increasingly determining the scope of consent required from the context of a given mobile transaction in light of reasonable consumer expectations and industry norms.(fn5) While this shift towards a more common sense approach is effectively expanding the scope of consent for mobile communications, businesses and their counsel must continue to closely monitor FCC declaratory rulings and court decisions to properly assess compliance risks. This Article examines emerging trends in delineating the scope of consent for mobile text messages under the TCPA. Part I describes the rationale and relevant rules governing consent under the TCPA. Part II then analyzes two recent FCC declaratory rulings and three recent court decisions. Finally, Part III focuses on three common instances where unwary businesses can exceed the scope of consent granted by their mobile customers, and provides recommendations for minimizing such risks.

I. THE TELEPHONE CONSUMER PROTECTION ACT

In 1991, Congress enacted the TCPA to protect consumers from the growing numbers of telemarketing calls and faxes that one TCPA sponsor deemed the "scourge of modern civilization."(fn6) However, rather than prohibit all forms of commercial communications, Congress "aimed to strike a balance between protecting consumers from unwanted communications and enabling legitimate businesses to reach out to consumers that wish to be contacted."(fn7) As a result, both the FCC and the courts grant considerable weight to legislative intent when analyzing a TCPA case.(fn8)

In relevant part, the TCPA prohibits businesses from making any mobile "call" without the "prior express consent" of the customer with limited exceptions, such as calls made for emergency purposes.(fn9) The prohibition of "calls" extends to text messages, such as those sent via Short Message Service (SMS), as well as voice calls.(fn10) While the TCPA does not define what constitutes "prior express consent," Congress delegated authority to the FCC to establish rules and regulations to implement the TCPA, whereby the FCC's interpretations of TCPA are controlling unless invalidated by a court of appeals.(fn11) Accordingly, federal district courts consistently refer to the FCC's interpretation of the TCPA when deciding TCPA cases.(fn12)

While non-telemarketing messages, such as purely informational and non-commercial messages, require "prior express consent," heightened TCPA consent rules effective October 16, 2013,(fn13) require businesses to obtain a consumer's "prior express written consent" before sending a telemarketing message.(fn14) The writing requirement can be met through any legally recognized electronic or digital form, such as one that conforms to E-SIGN.(fn15) Notably, the inclusion of the writing requirement adds an extra hurdle for businesses seeking permissible consent: whereas businesses can obtain "prior express consent" either explicitly or implicitly through any reasonable method,(fn16) they must explicitly obtain "prior express written consent" by obtaining clear written consent authorizing the delivery of specified telemarketing messages.(fn17) Thus, a business can unwittingly exceed the scope of consent if, despite obtaining prior express consent, it sends a text message to a customer that does not fully comply with the terms provided for in the written consent agreement.

As aforementioned, the vast majority of TCPA claims focus on non-consent cases. The reason for the popularity of such cases is that prior express consent is an affirmative defense and businesses bear the burden of demonstrating that they obtained proper prior express written consent from the customers.(fn18) Accordingly, in defending against a TCPA non-consent claim, a business must either show that the mobile marketing text message fell within the scope of consent provided or was altogether exempted from the TCPA.

II. DELINEATING THE SCOPE OF CONSENT

In light of Congress's intent that the TCPA "not be a barrier to normal, expected, and desired business communications,"(fn19) both the FCC and the courts have increasingly adopted a more common sense approach to evaluating consent...