It’s been awhile since we posted about the Telephone Consumer Protection Act (TCPA). Last year a federal appeals court in Washington DC struck down a critical component of the law and since then Congress has been in gridlock. Everyone but the telemarketers agree the law needs to be fixed but politics in Washington these days seem to be focused on the impeachment “inquiry”, whatever that is.
This week a major federal SPAM texting case settled in West Palm Beach. We think there are other similar situations to this case. That means new opportunities for people tired of getting spam text messages.
The promotion at issue was started by several Pizza Hut franchises. A customer could get discounts by signing up for text message promotions. That is totally legal. The law says companies can text you into oblivion as long as you consent. There is also a requirement that it be easy to opt out at any time.
Friend Forwarder Program Illegal
The Pizza Hut franchises were on the right track until they unveiled the “Friend Forwarder” program. Do you want even more discounts or just feel like your friends would love you even more if you signed them up for Pizza Hut promotional messages? Pizza Hut made it easy to do so.
They invited registrants to sign up friends and family and thus become eligible for prizes.
When I was a little kid, we found a Playboy magazine and thought we were cool when we used the subscription cards in the magazine to sign up teachers and the principal for the magazine. Pizza Hut isn’t responsible when a child or adult randomly signs up all his buddies for promotional texts but they were liable in this case.
What is the difference? The Telephone Consumer Protection Act requires consent for telemarketing calls and text messages. If you randomly sign up your buddy for text messages that isn’t the telemarketer’s fault. It is their fault, however, when you ask the customer to sign up his friends and even offer prizes for doing so.
The case was filed by Brian Keim after he said he and others received “thousands of unwanted spam text messages.” These were messages that he didn’t sign up for.
Under the settlement, the two franchise operators have agreed to pay $6 million. It’s hard to estimate how many customers will sign up for the settlement but the attorneys believe that customers will receive $400. That number can vary by how many people sign up.
The TCPA law is most known for spam calls but also includes unsolicited text message. The law provides damages of between $500 and $1500 per text message. If Brian Keim is correct and received thousands of texts, he would be eligible for a million dollars as would every other affected Pizza Hut customer. The two franchise companies would most certainly simply go bankrupt and close their doors.
In TCPA class action cases, the court holds a fairness hearing to insure everyone’s rights are balanced. Inevitably, some folks will say the $400 isn’t enough. Usually the court approves the settlements understanding that not everyone will be satisfied. The courts also know that with such high penalties, imposing those fines would simply drive the company out of business.
Are Other Companies Running a Friend Forwarder Text Message Campaign?
We haven’t heard of other companies having a “friend forwarder” type campaign. But we certainly are interested in finding them. It’s one thing to get consent and sign people up for discount campaigns. It’s quite another, however, to circumvent the law by asking participants to sign up others without their consent.
As much as you think that Sally or Dad would love a thousand text messages offering free cheesy breadsticks, you don’t have the right to consent for them and companies like Pizza Hut shouldn’t offer prizes to get you to do so.
Speaking of Pizza Hut, the $6 million dollar settlement is being paid by the two franchise operators. The parent Pizza Hut company was also sued. Because the case settled, we don’t know if they would have been forced to pay as well. (And they certainly have much deeper pockets.)
This was one of the most hotly disputed TCPA SPAM text cases ever filed. It began in 2012. The case was tossed out of court and dismissed, Brian Keim’s lawyers appealed and won, the lawsuit was subsequently amended to include Pizza Hut the parent company and 7 years later it was settled.
We now know that companies can be held responsible for promotional text messages to be sent to individuals whose telephone number was provided by a third-party without consent in violation of the TCPA. The promoters of these promotional schemes can’t hide behind so-called consent confusion.
Now we need your help. If your buddy signed up you up for promotional text messages because he was drunk or thought it was funny, there probably is no case. But if your buddy signed you up because the company asked for the numbers of friends and family, you may have a case.
As noted, most of these cases are handled as class actions. It is expensive to litigate a single case (unless you can prove you received 1000’s of unwanted text messages). If you know of a business seeking to sign up “friends and family” for promotional text messages, call us.
Please note that telemarketers can spam text a wrong number once. They are supposed to offer an easy opt out mechanism. If a company makes a mistake either because your phone number once belonged to someone else or because your buddy played a prank and signed you up, that’s not on the telemarketer. The cases we handle typically involve multiple texts and no way to stop them.
For more information, visit our TCPA robocall claims information page. Ready to see if you have a case? Contact us online, by email or by phone at 202-800-9791. All inquiries are protected by the attorney – client privilege.
Do you work at one of these companies and believe the company is wrong for spamming people? We would love to hear from you confidentially and off-the-record.