While motions to dismiss tied to the Texas Public Participation Act have been a hot topic among the Texas legal community, lawyers from Norton Rose Fulbright last week secured a different kind of TCPA win in California tied to another heavily-litigated subject: text message telemarketers.
In a summary judgment ruling issued Friday, a federal court in Los Angeles dismissed NRF’s clients — financial news publication Investor’s Business Daily and its premium subscription service, MarketSmith — from the litigation with prejudice.
The class action lawsuit, filed in March 2018, claimed IBD, MarketSmith and other defendants violated the Telephone Consumer Protection Act (TCPA) when they engaged in a marketing campaign that sent unwanted text messages about MarketSmith to consumers.
The ruling, which was issued in a region that is known to be pro-consumer, draws the line for the extent that companies could be held liable for text messaging and telemarketing campaigns conducted by outside marketing firms that could be violating the TCPA.
Under the law, consumers are allowed to sue companies that make phone calls or text messages using an automatic telephone dialing system. Because minimum statutory penalties are $500 per phone call or text and the trend for insurance carriers to exclude the TCPA from their coverage, the stakes can grow high for companies that engage in marketing campaigns that do not comply with the statute’s requirements.
Whether the campaign in this situation violated laws had not been yet determined, but the lawsuit subjected the defendants to $25 million in possible liability based on the statutory penalties alone.
The plaintiff, California resident Clifford Armstrong, claimed in his lawsuit that the text messages caused “cognizable legal injury” to himself and the proposed class. He also claimed the text messages caused many other damages to their phones, including wear and tear, a weakened battery life and lost cellular minutes.
IBD claimed it did not know the plaintiff received the text messages, that it did not authorize its outside marketing agency to violate the TCPA and that it expected any marketing activities conducted by its third parties would comply with all applicable laws.
U.S. District Judge Michael W. Fitzgerald of the Central District of California sided with IBD and MarketSmith on Friday, holding that there was a lack of evidence to prove Armstrong’s claims, including the failure of evidence to establish that the text messages were sent by an automatic telephone dialing system.
Judge Fitzgerald also pointed out that Armstrong received the text messages at work and that before he retained a lawyer, he looked at the message “only one time for a total of six to eight seconds.”
“Plaintiff did not click on the link, did not respond to the message, and is unaware of anyone else who received the text,” Judge Fitzgerald wrote. “At the time he received the text, plaintiff was unaware that the message came from Handstack [a third party working with the marketing agency] or that Handstack was working for IBD.”
Lawyers on both sides declined to comment on the ruling.
The Norton Rose Fulbright team representing IBD and MarketSmith was led by San Antonio partner Saul Perloff, Austin partner Peter Stokes, and also includes Los Angeles associate Andy Guo. IBD General Counsel Patrick Begley was also heavily involved.
Armstrong’s legal team included lawyers from Miami, New Jersey and Encinitas, California.