Subway avoided liability under the Telephone Consumer Protection Act (TCPA) when an Illinois federal court dismissed the sandwich chain from the action, based on texts from T-Mobile offering its customers a free Subway sandwich.
The text at issue read: “This T-Mobile Tuesday, score a free 6 Oven Roasted Chicken sub at SUBWAY, just for being w/ T-Mobile. Ltd. supply. Get app for details,” accompanied by a link with more details. Illinois resident Matthew Warciak filed a putative class action on behalf of T-Mobile customers who did not consent to receive promotional text messages, naming both T-Mobile and Subway in his complaint.
Subway responded with a motion to dismiss, arguing that it was neither directly nor vicariously liable under the statute for the text message. U.S. District Judge Charles P. Kocoras granted the motion, agreeing on both counts.
“The complaint acknowledges that T-Mobile is the entity that physically sent out the text message at issue, meaning that Subway was not the actual sender,” the court said. “The complaint does not allege that Subway was intimately involved in giving instructions to T-Mobile regarding the details of the text message. Accordingly, the Court finds that the complaint does not allege sufficient facts to hold Subway directly liable for a violation of the TCPA.”
Turning to the question of vicarious liability, the court explained that the plaintiff needed to allege facts indicating that Subway had control over T-Mobile’s acts, such as the quality, timing and volume of calls or the geographic location of targeted customers.
But Warciak asserted that Subway “engaged” in a text message campaign “through a marketing partner” and “had these text message calls made.”
“Notably absent from the complaint are any facts alleging that Subway controlled the timing, content or recipients of the text message,” Judge Kocoras wrote. “Indeed, Warciak acknowledges that the recipients of the text message are all T-Mobile customers, indicating that Subway did not have control over who received the text message. Therefore, the complaint does not allege sufficient facts to establish a common-law agency relationship.”
The court further found that the plaintiff failed to establish vicarious liability through apparent authority or ratification, as Warciak failed to allege that he reasonably believed T-Mobile texted him as Subway’s agent, and that his belief was traceable to some communication from Subway.
“The complaint does not allege that there was any communication from Subway to Warciak, so as to qualify as a ‘manifestation of the principal,’” the court stated. “Moreover, the complaint states that the text message from T-Mobile was directed to T-Mobile customers, was part of a T-Mobile program that rewarded customers ‘just for being w/ T-Mobile’ and directed recipients to a T-Mobile website.”
“Due to the lack of factual support for the claim that T-Mobile was communicating as Subway’s agent, the Court cannot find apparent authority based on the facts alleged. Given that Warciak failed to sufficiently allege that Subway exhibited actual or apparent authority, ratification is also unavailable. Accordingly, the Court finds that the complaint cannot support a theory of vicarious liability.”
Judge Kocoras also determined that the wireless carrier exemption to the TCPA applied because T-Mobile was messaging its own customers, who were not charged for the text at issue.
“This type of content falls squarely within the sort of communications Congress anticipated between wireless carriers and their customers,” the court noted. “Accordingly, the wireless carrier exemption applies to the text message at issue and there cannot be a TCPA violation based on the facts alleged in the complaint.”
To read the memorandum opinion in Warciak v. Subway Restaurants, Inc., click here.
Why it matters: T-Mobile’s text spawned multiple lawsuits across the country, but Subway managed to evade the Illinois class action when the court found no sufficient basis on which to hold the sandwich chain directly or vicariously liable for a violation of the TCPA, and further found that the statute’s wireless carrier exemption applies, meaning no underlying TCPA violation occurred. Despite this victory, however, the litigation continues as the plaintiff has already filed notice of appeal with the district court, seeking review by the U.S. Court of Appeals, Seventh Circuit.