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Terms and Conditions May Give Express Consent to Text Advertisements

federal court ruled that online Terms and Conditions may cause consumers to give express consent to receiving advertisements by text message under the Telephone Consumer Protection Act.

If you have signed up for text alerts, chances are you have encountered terms and agreement or a “REPLY Y to continue, STOP to end alerts.”

The recurring issue with the TPCA cases is consent, whether recipients have expressly consented to receive text alerts.

The TCPA a strict liability statute, prevents making any call using any automatic telephone dialing system to cell phone numbers unless the person expressly consents. 47 U.S.C. 227(b)(1)(A).

The term “call” includes text messages, thus the TPCA act would apply to text messages sent to cell phone users.   A person or company may be fined up to $1,500 per willful violation.

YAHOO! Welcome Messages

Recently, the district court in Johnson v. Yahoo Inc addressed whether Yahoo! violated the TCPA for sending unsolicited text messages to Yahoo users cell phones. Class action status was granted to the plaintiffs in January, which allowed the case to proceed against the company.

The following messages sparked this litigation:

  • A “Welcome” system message: “A Yahoo! User has sent you a message. Reply to that SMS to respond. Reply INFO to this SMS for help or go to yahoo.it/imsm”
  • A “Warning system message states: “To continue receiving Y! message you need to reply to one. Or reply to this msg to RESET. Reply INFO for help or go to y.ahoo.it/imsms”

The plaintiffs alleged that responding to the text notices regarding changes to the terms of service did not equate to express consent. The district court rejected the plaintiff's argument, holding that by providing a cell phone number the users gave consent to receive communications by any method outlined in the terms of service, including text messages.

Other Major TCPA Cases

In February, a decision was issued in Campbell-Ewald Co. v. Gomez, 135 S.Ct. 2311 (2016). Jose Gomez had filed suit against the Campbell-Ewald, an advertising and marketing agency, after he received text messages from a US Navy recruiting campaign.  At age 40, Gomez claimed he was not apart of the 18-24 target group and never consented to receiving the messages.

Before the deadline for class action certification passed Campbell attempted to settle with Gomez. The Supreme Court addressed whether Gomez's case was moot because of the attempted settlement. The court held that an unaccepted settlement offer or offer judgment did not leave the plaintiff without standing.

In 2014 there were several other cases filed alleging violations of the TCPA. A consumer filed suit against Wells Fargo & Co for automated debt collection calls. Plaintiff Lilian Franklin alleged the bank repeatedly called her cell phone to collect credit card debt. The phone calls used prerecorded messages in addition to contacting persons without express consent. This class action case ended with a $14.5 Million settlement for the plaintiff.

In Plaintiff v. Kaiser Foundation Health Plan, Kaiser settled for $5.35 million to satisfy the TCPA violations against it. The insurance company was accused of making prerecorded calls to cellphones to resell its insurance coverage. This case  in the Southern District of California was granted class action status. The final settlement claims were accepted in 2015.

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