A consumer who voluntarily provides a cell phone number when registering online for membership has given “prior express consent” under the Telephone Consumer Protection Act (TCPA) to receive a text message containing instructions for activating such membership, a Washington federal court recently ruled.

In Aderhold v. Car2go N.A., LLC, the plaintiff had entered his e-mail address and cell phone number on an online registration form he completed to become a member of a local car-sharing service. He also checked boxes to confirm his review and acceptance of various documents, including a “Trip Process” document that indicated the defendant would validate information provided by the plaintiff and confirm acceptance of his registration.

Such documents also included a privacy policy that indicated the defendant would use the plaintiff’s personal information for business purposes that included membership validation. Within seconds of submitting the form, the plaintiff received an e-mail and text message from the defendant. The text message directed him to enter an activation code into a link contained in the e-mail and stated that the defendant looked forward to welcoming him.

The plaintiff alleged that the text message violated the TCPA provision that makes it unlawful to make autodialed or prerecorded non-emergency calls to a cell phone number unless the call is made with “the prior express consent of the called party.” He argued that he did not give “express consent” by providing his cell phone number because there was no accompanying disclosure by the defendant that doing so would result in his receipt of a text message.

As an initial matter, the court rejected the plaintiff’s argument that the text message he received was not subject to the Federal Communications Commission’s (FCC’s) ruling that “persons who knowingly release their phone numbers have in effect given their invitation or permission to be called at the number which they have given, absent instructions to the contrary.” It then reviewed numerous cases in which federal courts found that express consent was given to receive text messages “based on the context of the transaction in which a consumer provides her cellular number.”

Stating that it did not “purport to rule upon what ‘prior express consent’ means in every case,” the court held that the plaintiff consented to the text message at issue. In the court’s view, the text message fell “squarely within the scope of” the disclosures the plaintiff received when he registered because it validated his cell phone number, confirmed acceptance of his application, and was a form of membership validation.

While observing that the plaintiff “arguably did not explicitly grant permission for car2go to contact him by text message,” the court nevertheless stated that “no reasonable person in his shoes could have doubted that car2go would contact him in some manner.” The court also said the defendant’s use of text message was “not significant” because the plaintiff “clearly and unmistakably consented to being contacted about his registration.”

Using “the common sense approach that courts construing the TCPA have advocated,” the court further observed that, even if the defendant had made no disclosures, “it defies logic to contend that [the plaintiff] did not consent to be contacted regarding his membership application” and that “when people provide their telephone numbers in commercial transactions, it would be odd to imagine that they do not consent to be contacted for purposes of completing that transaction.”

Effective October 16, 2013, the FCC’s TCPA rules were changed to require prior express written consent for autodialed or prerecorded telemarketing calls to cell phone numbers. Such consent must be in the form of an agreement that satisfies specified FCC requirements. The rules change, however, does not affect autodialed or prerecorded “informational” non-sales calls to cell phone numbers such as the Aderhold text message. Such calls can still be made with only the consumer’s “prior express consent,” which can be written or oral, so long as the caller can prove there was consent.

Because the Aderhold text message was sent in 2012, it would not have been subject to the new FCC rules. The court declined to analyze whether it would have been prohibited by the new rules had they then been in effect. Nonetheless, the court found unpersuasive the plaintiff’s argument that the text was a telemarketing message because the link took him to a website that included promotions for the service.

We continue to see a high volume of class actions alleging TCPA violations. In part, this is because the penalties are draconian. Violations can yield damages of $500 per violation or actual damages—whichever is greater—with a tripling of damages for willful violations and unlimited class action liability.

Ballard Spahr’s Consumer Financial Services Group is nationally recognized for its guidance in structuring and documenting new consumer financial services products, its experience with the full range of federal and state consumer credit laws throughout the country, and its skill in litigation defense and avoidance (including pioneering work in pre-dispute arbitration programs). In addition to having vast experience in defending TCPA lawsuits, the Group has counseled a number of clients on establishing autodialing and monitoring protocols.

For more information, please contact CFS Practice Leader Alan S. Kaplinsky at 215.864.8544 or kaplinsky@ballardspahr.com, John L. Culhane, Jr., at 215.864.8535 or culhane@ballardspahr.com, or Mark J. Furletti at 215.864.8138 or furlettim@ballardspahr.com.

Copyright © 2014 by Ballard Spahr LLP.
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This alert is a periodic publication of Ballard Spahr LLP and is intended to notify recipients of new developments in the law. It should not be construed as legal advice or legal opinion on any specific facts or circumstances. The contents are intended for general informational purposes only, and you are urged to consult your own attorney concerning your situation and specific legal questions you have.

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