United States: Text Message Marketing In 2021: Recent Developments At The Federal And State Level

Businesses across many different industries utilize text messaging programs to communicate with their consumers, both through rewards programs or general text message marketing campaigns. The benefits of these programs to both businesses and consumers are apparent, but text message communication with consumers has often been seen as a prime target for the plaintiffs' bar. Although the recent U.S. Supreme Court decision that clarified that only a narrow definition of an automatic telephone dialing system ("ATDS") applies under the Telephone Consumer Protection Act ("TCPA") curbed some litigation, developments at the state level may present new challenges.¹ Companies should not overreact, but should be prepared to act accordingly as the landscape surrounding telemarketing laws develops.

On April 1, 2021, the U.S. Supreme Court unanimously held in Facebook Inc. v. Duguid that "Congress' definition of an autodialer requires that in all cases, whether storing or producing numbers to be called, the equipment in question must use a random or sequential number generator."² The decision was noteworthy because the use of ATDS is an essential element of a claim under the TCPA and prior to Duguid, a circuit split had developed over the definition of an ATDS. More specifically, three circuits defined an ATDS as any device that can store and dial telephone numbers (essentially encompassing nearly any type of modern text messaging platform), while three circuits followed the unambiguous text of the TCPA, enforcing a narrow definition. The Duguid decision resolved the issue by adhering to the statutory language and establishing that equipment that makes calls to "targeted ... numbers linked to specific accounts," like the equipment utilized by many businesses, is excluded from the TCPA's ATDS restrictions.³

Although the Supreme Court's holding in Duguid provided some relief to businesses seeking to communicate with consumers using text messages, some states moved quickly to further muddy the waters surrounding telemarketing. In particular, the Florida legislature acted within weeks to amend the Florida Telephone Solicitation Act ("FTSA"), effective July 1, 2021, incorporating a new private right of action and imposing new restrictions on businesses placing calls or text messages to individuals in "Florida ... at the time of the call" using an automated system.⁴ The term "automated system" is undefined and it is unclear whether Florida courts will interpret the term more broadly than courts interpret an ATDS under the TCPA. There are also other new elements of the Florida statute that are important for businesses to understand, including, but not limited to, the attorneys' fees provision and the presumption that a telephonic sales call made to a Florida area code "is made to a Florida resident or to a person in Florida at the time of the call."⁵

In addition to the new Florida statute, businesses should be cognizant that certain states, such as Washington state, already had stringent telemarketing statutory schemes, which may require additional guidance as claims under state statutes become more prevalent. Professionals should also keep an eye on potential forthcoming state legislation. For example, states such as New York and Massachusetts have introduced telemarketing legislation this year, although these bills specifically seem unlikely to be passed by their respective state legislatures in the near future.

These recent developments in the law surrounding text message marketing programs should encourage businesses to examine their compliance measures and relevant terms and conditions. It is important for businesses to continue to adapt, particularly as state legislatures navigate a postDuguid world and courts examine the applicability and constitutionality of the FTSA and any other state telemarketing statutes to come.

Footnotes

1 Facebook, Inc. v. Duguid, 141 S. Ct. 1163, 1170 (2021)(analyzing 47 U.S.C. § 227(a)(1))

2 Duguid, 141 S. Ct. at 1170.

3 Id. at 1168.

4 Fla. Stat. § 501.059.

5 Fla. Stat. § 501.059(8)(d).

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