Why it matters
Detailed discussion

Why it matters:

Retailers communicate with their customers frequently as an essential part of their business. While these communications are typically expected and desired, that doesn't shield even the most well-intentioned companies from the explosion of Telephone Consumer Protection Act (TCPA) litigation seen the past few years. In this climate, many companies struggle to balance communicating with their customers and warding off litigation.

A recent decision by the Ninth Circuit underscores why good compliance is key, and also lends clarity to certain key parameters, such as the scope of consent and revocation thereof.

Detailed discussion:

On January 30, 2017, the Ninth Circuit issued its decision in Bradley Van Patten v. Vertical Fitness Group et al., No. 14-55980, a case that addressed a number of significant TCPA issues. Plaintiff Van Patten joined a gym in 2009 and provided his cell phone number on the membership application. He canceled his membership shortly thereafter. In May and June 2012, he received several promotional text messages from the gym inviting him to re-join. Van Patten filed a putative class action alleging various violations of the TCPA, arguing that he never consented to receive the text messages and even if he had, he revoked consent when he canceled his membership.

The defense initially argued that Van Patten did not have Article III standing for his suit, citing the U.S. Supreme Court's recent decision in Spokeo v. Robins. The Ninth Circuit rejected this argument, finding that "[u]nsolicited telemarketing phone calls or text messages, by their nature, invade the privacy and disturb the solitude of their recipients." The panel distinguished Spokeo, reasoning that "[u]nlike in Spokeo, where a violation of a procedural requirement minimizing reporting inaccuracy may not cause actual harm or present any material risk of harm . . . the telemarketing text messages at issue here, absent consent, present the precise harm and infringe the same privacy interests Congress sought to protect in enacting the TCPA." Thus, "[a] plaintiff alleging a violation under the TCPA 'need not allege any additional harm beyond the one Congress has identified.'" (quoting Spokeo).

This ruling is consistent with prior Ninth Circuit TCPA decisions on this issue, effectively foreclosing the applicability of Spokeo to virtually all TCPA cases in that circuit.

The Ninth Circuit's ruling on revocation of consent provided a mixed result for defendants. On one hand, the court held that revocation must be "clearly made" and Van Patten's cancelation of his gym membership, standing alone, was insufficient to constitute revocation of consent for calls and text messages. However, the Ninth Circuit definitively held that the defendant bears the burden to prove that consent was previously given, a finding consistent with the FCC's July 2015 ruling on that issue, but unclear within the circuit as some lower courts placed the burden of proving a lack of consent on the plaintiff. Now, it is squarely on the defense to prove consent by affirmative evidence.

The Ninth Circuit also reaffirmed the importance of considering the context of the circumstances under which consent is provided. The texts Van Patten received were an offer to re-join the gym. Thus, the court held the texts were within the scope of his consent because he had provided prior express consent to receive text messages related to his gym membership when providing his mobile number on his original gym application. (It is also noteworthy that the texts were sent prior to the FCC's 2012 Order requiring prior express written consent went into effect in October 2013, so the standard was prior express consent even though the texts were marketing).

For further information on this topic please contact Christine Reilly at Manatt Phelps & Phillips LLP's Los Angeles office by telephone (+1 310 312 4000) or email ([email protected]). Alternatively, contact Marc Roth at Manatt Phelps & Phillips LLP's New York office by telephone (+1 212 790 4500) or email ([email protected]). The Manatt Phelps & Phillips LLP website can be accessed at www.manatt.com​.

Diana L Eisner also contributed to this update.

This update has been reproduced in its original format from Lexology – www.lexology.com.