…another important development in the area of mobile marketing and advertising.
Last week, the U.S. District Court for the Northern District of Illinois’ Eastern Division found that a 20th Century Fox SMS campaign violated the Telephone Consumer Protection Act (the “TCPA”). While these cases provide extremely important guidance as mobile marketing continues to evolve into legitimate and effective marketing medium, equally noteworthy is the fact that the SMS campaign in question took place five years ago.
On Oct. 1, 2005, 20th Century Fox sent text messages to various consumers advertising the release of its “Robots” movie on DVD. Victor Lozano was one of many individuals who received these text messages without having signed up for, or otherwise consented to, receiving them. Over the next several months, Mr. Lozano asserted that he received additional unsolicited text message advertisements from 20th Century Fox concerning “Robots” and other properties that were being marketed. As a result, he filed a lawsuit alleging that that text-message campaign was unlawful.
As we’ve written here in the past, the TCPA generally prohibits the use of an automatic telephone dialing system (“ATDS”) to place calls to a mobile number without the prior express consent of the recipient. Moreover, this court, like others before it, found that it is not necessary to prove that the sender actually used the equipment’s ATDS capacity, only that the equipment had that capacity. Although section 227 of the TCPA places certain restrictions on the making of an unsolicited “call,” the FCC has taken the position that sending SMS is the equivalent of making a call, at least when it comes to marketing communications.
Despite 20th Century Fox’s argument to the contrary, the court found the FCC’s interpretation to be reasonable and held that the 20th Century Fox text-message campaign was subject to the TCPA. Additionally, the court rejected the defendant’s notion that the TCPA only prohibits calls that result in a charge to the recipient.
Along with the case presented above, a class action lawsuit was filed very recently in Chicago against Selling Source, a web development, hosting and Internet marketing company, for sending “unsolicited” SMS messages via an ATDS, which the plaintiffs claim is a direct violation of TCPA laws. The defendant in the case filed a motion to have the case dismissed pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure, which states that lawsuits with insufficient legal theories underlying their cause of action is grounds for dismissal in court. Despite Selling Source’s defense as to why SMS marketing messages should not fall under the terms of the TCPA, the FCC had already ruled that SMS was in fact covered under TCPA laws and were considered “calls” just like phone solicitations, and, as such, are subject to the same regulations set forth by the TCPA.
Why This Is Important: Consent is absolutely essential for SMS marketing and, as the recent string of cases in this area strongly support, an argument that text messages aren’t subject to the TCPA is likely to fail. In addition, marketers should be cognizant that they are being regulated by yet another governing body (the FCC), thereby adding to the complication and worry on behalf of marketers who must apply, and make sure they adhere, to strict opt-in and deliverability standards, while being subject to lawsuits such as the one described above, where clear-cut laws under the TCPA are still not fully in place.