Derek: Hi, Derek Johnson with Tatango.com.
I’m here at Innovista Law, home of the TCPA Defense Force.
I’m sitting with TCPA Attorney David Carter.
So one of the questions we get asked, David, is, first of all, in text message marketing
you have to get consent to text message your customers.
Now what happens if that business wants to maybe sell that list of phone numbers or the
business goes out of business or maybe somebody acquires that business?
What happens to the consent from those consumers and kinda what are the legalities around that
I guess under the Telephone Consumer Protection Act?
David: Sure.
So looking at the question of what is the consent and when a consumer opts-in, they’re
not just opting-in to receive any message you wanna send them.
Usually there’s gonna be a Terms of Service that lays out the types of message, the marketing
materials you might be sending them, things of that nature.
And so to answer the question who else could rely on that consent, you often have to start
with what was the actual consent.
Derek: So when someone actually texted in or entered their phone number into a website,
what were they actually agreeing to?
David: Correct.
Derek: Okay.
David: And because even within a single company, right, that hasn’t sold or been bought out
by anyone or closed down, you know, there could be lines within that very company about
what is an appropriate message to send to those individuals because maybe they only
consented to receive messages about a particular sweepstakes, for example, or something that
you’re giving away, right.
They didn’t then give you a consent to continue to message them about other products or other
services that you have.
So, really, the issue of consent has to start…[inaudible 00:01:59] has to start with, well, what was
the consent?
Derek: Okay.
David: When you move past that and ask the question, “Well, if a brand’s been sold,
and someone else has taken over the company, do they have to go back and get consent?”
Again, that’s…the answer could be yes or no, unfortunately, right?
This is not…this is one of those areas where in some occasions it may be perfectly appropriate
for the next…for the new owner to take over and continue sending messages because that’s
what the consumer would expect right?
For they would…
Derek: Same brand name, same content, same [crosstalk 00:02:36].
David: Same product, nothing has really changed so they wouldn’t…if there’s some corporate
restructuring behind the scenes, the consumer wouldn’t expect to like stop receiving messages,
right?
In other instances though, perhaps, a company gets brought out and their name, the name
of the company goes away.
They get absorbed into a larger enterprise.
Well, that may be a slightly different analysis to deal with.
You may not be able to…a consumer may not expect to get messages from ABC Corp. today
and then they get bought out and all of a sudden it’s, you know, ACME, that’s the
name the message [inaudible 00:03:09].
Derek: Maybe they’re selling something completely different.
David: Right, or they’re combining it or bundling it in a way that’s very different,
a very different service from the consumers originally receiving messages about.
So these issues about who can rely on consent that’s been given, how broad does that consent
go, it’s one of those areas it’s not always black and white.
It actually is probably really black and white when you’re asking those questions.
Derek: It seems that way.
David: There are a couple of black letter, black and white things, you know, that if
a brand has consent to send messages to consumers then a company like Tatango that facilitates
sending those messages can rely on that consent.
So we do know that, right?
But if you’re asking, you know, can the sister corporation rely on the consent?
Can the other brand name that’s sort of associated with the company, those are gonna
be very fact-specific inquiries.
And you’re gonna have to have a close examination of what’s the language of the consent, what
was the consumer expectation.
Derek: And that’s only changing, right, to the law under the Telephone Consumer Protection
Act.
It was developed in 1991?
David: Correct.
Derek: And since then it’s ever changing.
So it could be today something but then tomorrow something different.
David: I think that’s definitely the case.
The law continues to evolve, the case law and analysis about these questions of whether
that was a reasonable expectation, does that consent extend there.
Those cases are gonna continue to evolve.
And then you also have issues about what was required to get the consent in the first place,
right?
Derek: What does that mean?
David: Well, there’s questions about the level of like written consent.
For example, for text messaging marketing, you need to have written consent, right?
So you’re gonna have to have a record of that.
And you’re gonna have to tell consumers there’s a requirement now the FCC created
in 2015 that you have to tell consumers when they’re consenting that making a purchase
is not a requirement or, excuse me, opting-in to receive a text message is not a condition
of purchase.
So there is…that was a 2015 requirement that got added by the FCC.
So the level of consent and how you get consent continues to change or evolve.
And so if you’re…say, you’re buying out a company that’s been doing text messaging.
You’re gonna wanna review…you guys just wanna assume that they have been doing it
right, that they have all the right levels of consent and that you’re just gonna continue
to send text messages.
If you’re doing due diligence and you’re acquiring a company that’s been text messaging,
you’re gonna wanna really have someone take a look at the list they have, how they obtained
the list, did they get the right level of consent, did they do the right disclosures…
Derek: Good check-up time almost, okay.
David: Exactly.
And you may decide even if it’s…even if you can make a good argument that the consent
flows into the new company, you may decide, you know what?
As a risk prevention measure, it’s time to go back and get people to confirm that
they wanna be on the list.
Derek: Interesting.
One of the things you said I think that’ll impact a lot of brands is the same brand,
let’s just use, you know, GAP for example, if you opt-in for text messages from GAP and
you opt-in for offers and alerts…
David: True.
Derek: Maybe let’s say offers and coupons, let’s make it very specific.
You’re opting-in for offers and coupons.
So GAP cannot send you employment offers essentially.
You know it’s coming from GAP.
David: Correct.
Derek: Like it’s…you opted-in to…people think you opt-in to GAP messages.
You’re actually opting to a certain kind of message from the brand.
David: Right, and that’s exactly, again, the language of the opt-in really matters
like [crosstalk 00:06:49].
Derek: Okay.
You have to really like tailor to make sure that you’re not excluding something you
might wanna send them in the future.
David: Exactly, and you gotta make sure that, again, our consumers are informed at the time
that they give you consent about what types of messages they’re gonna be receiving from
you.
And if you deviate from that, you do run the risk that someone says, “Well, look, you
know, my consent was limited and I don’t…I’m not authorizing you to send me these other
types of messages about your company.”
Derek: And if for some reason you maybe do deviate, what are the penalties for violating
the Telephone Consumer Protection Act?
David: So the penalty of the TCPA are pretty significant.
And so the Act, the Telephone Consumer Protection Act, has minimum statutory damages of $500
per unauthorized message.
So think that like per message, per person, adding up across the…
Derek: So very expensive.
David: Could be very expensive and then you have on top of that the potential that that
goes up to $1,500 per message if they can show that you knowingly and willfully violated
by sending out messages to people that had not authorized them.
And that’s an addition to, you know, other potential penalties from the Federal Communications
Commission, State Attorney General and others that could come after you as well.
And so when you’re talking about the Telephone Consumer Protection Act, sending out text
messages, it’s really critical that companies look at these requirements that they take
a pretty conservative approach.
If there’s two interpretations they should, you know, think about what’s the potential
exposure for the different interpretations.
Derek: Because the risk is really high.
David: The risk is disproportionately high and these cases usually go as class action
litigation.
So it’s not just one plaintiff.
Derek: Okay.
So it’s your entire list being angry at you going, you know, to court.
David: And plaintiff’s attorneys that will bring the case on behalf of all of those people
together.
And so the damages can add up very quickly.
And so it’s important that you, you know…companies work with experienced attorneys in this space
with a reputable company that’s helping to send messages on their behalf and then
understands a pretty dynamic landscape that changes on a regular basis.
Derek: It almost seems like you need to work with, you know, a TCPA attorney or expert
at the get go.
It’s not, you know, when you’re interested in transferring your list or, you know, your
company gets bought out.
That’s the time to engage with attorney but not the first time.
The first time should be at the very get go and then also during I guess because things
are changing.
So it seems like the engagement is for the entire time.
David: I think that certainly companies that are really on top of this issue and making
sure that they’re complaint which…and I wanna make that point too, right.
It is possible to comply.
Derek: We have many brands that do.
David: We have many great brands that do this on a regular basis.
And so it’s just an understanding of like how to do the compliance in a way that doesn’t
stand in the way of communicating with your customers and reaching them but that keeps
you hopefully out of the litigation pool from paying lawyers much more money later down
the road and trying to really plan that out in advance.
So you’re absolutely right.
And you should have that continued engagement but certainly if you’re acquiring a company
that’s doing text messaging, you should be asking them, “Well, how have you been
ensuring continued compliance?
And who’s really helping you with that process?”
Derek: Perfect.
That sounds good.
Well, that answers the question from our viewers.
And this is David Carter, an attorney with Innovista Law at the TCPA Defense Force.
I’m Derek Johnson with Tatango.
We’ve essentially answered the question, you know, who owns the consent to your customers
that opt-in for text message marketing?
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