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Federal Deception Law: 6.7.1 Introduction

A significant form of unwanted telephone contact involves text messages sent to consumers’ cell phones. This section focuses on the applicability of this TCPA prohibition to unwanted text messages sent to consumers’ cell phones. Because it prohibits the use of automatic dialers to “call” a cell phone,951 the Telephone Consumer Protection Act (TCPA) generally prohibits spam text messaging. In section 227(b)(3), the statute provides an explicit consumer private right of action with statutory and treble damages.

Federal Deception Law: 6.7.2.1 Generally

With certain exceptions,956 the TCPA prohibits any person from initiating a “call” using an automatic telephone dialing system to “any telephone number assigned to a paging service, cellular telephone service, specialized mobile radio service, or other radio common carrier service, or any service for which the called party is charged for the call,” except in an emergency or with the prior express consent of the called party.957 As discussed below, many decisions have applied this provision to sp

Federal Deception Law: 6.7.3.1 Prior Express Consent

The TCPA’s prohibition on the use of autodialers to make voice calls and send text messages does not apply if the caller or sender has the recipient’s prior express consent.982 If the text message constitutes telemarketing or introduces an advertisement, the recipient’s consent must be written.983 Senders of spam text messages are rarely able to establish that they had the recipient’s consent.984

Federal Deception Law: 6.8.1 Introduction

The TCPA and the FCC rule adopted under it prohibit the use of a telephone fax machine, a computer, or any other device to send an unsolicited advertisement to a telephone fax machine.995 The impetus behind this prohibition is that junk faxes tie up recipients’ fax lines and shift costs from advertisers to recipients.996 The rule protects against faxes to business telephone subscribers as well as residential subscribers.997 While several of the TCP

Federal Deception Law: 6.8.2 Definition of “Telephone Fax Machine”

The statute defines the term “telephone fax machine” as “equipment which has the capacity . . . to transcribe text or images (or both) from an electronic signal received over a regular telephone line onto paper.”1002 Many courts have held that the junk fax prohibition applies regardless of whether the message is sent to a fax server or computer that receives and stores the message for later printing, or to a conventional fax machine that automatically prints each message.1003

Federal Deception Law: 6.8.3.1.1 Definition; constitutionality

The junk fax rule generally prohibits “unsolicited advertisement[s].”1012 The statute defines this term as “any material advertising the commercial availability or quality of any property, goods, or services” that is transmitted to another person without prior express invitation or permission.1013 The definition in the FCC regulation is identical.1014

Federal Deception Law: 6.8.3.1.3 Faxes that promote free goods or services

Fax messages that promote goods or services at no cost—such as free magazine subscriptions, catalogs, consultations, or seminars—can be unsolicited advertisements because they often serve as part of an overall marketing campaign.1042 In some cases, the fact that the fax is promoting the sender’s products will be apparent on its face, such as a fax that offers a free seminar but adds a laudatory description of its goods or services.

Federal Deception Law: 6.8.3.1.4 Informational messages

Some courts hold that “informational messages” that are not primarily advertisements are not unsolicited advertisements.1048 For example, the Eighth Circuit held that a health plan prescription benefits administrator’s fax to doctors, informing them of new limits on insurance coverage for their patients’ opioid prescriptions, was informational and not an unsolicited advertisement.

Federal Deception Law: 6.8.3.1.6 Faxes that promote an indirect profit for the sender

To be an unsolicited advertisement, a fax must propose a commercial transaction, but it need not be a direct transaction between the sender and the recipient.1069 For example, a fax that encouraged physicians to write prescriptions for the sender’s services was an advertisement even though the physician’s patients, rather than the physicians, would be the actual purchasers.1070 Similarly, a fax

Federal Deception Law: 6.8.3.3 Exemption for Established Business Relationship

The TCPA contains an explicit exemption for fax advertisements when there is an established business relationship between the sender and recipient, but only if the sender obtains the recipient’s fax number in a particular fashion and discloses an opt-out right.1104 The FCC defines an established business relationship as one created by a voluntary two-way communication on the basis of a purchase, transaction, inquiry, or application.1105 If there is an established business relationship, it ex

Federal Deception Law: 6.8.3.4.1 Overview

The TCPA requires that an unsolicited fax advertisement that is sent pursuant to an established business relationship contain a notice of the recipient’s right to opt out of receiving additional faxes.1116 This important requirement is discussed in § 6.8.3.4.2, infra.

Federal Deception Law: 6.8.3.4.2 Opt-out notice requirement for fax sent pursuant to established business relationship

Whenever an unsolicited fax advertisement is sent pursuant to the established business relationship exemption, the first page of the fax advertisement must contain a clear and conspicuous notice of the recipient’s right to opt out of receiving additional faxes.1122 This requirement is framed as an element of a safe harbor, and the Sixth, Seventh, and Eighth Circuits have held that non-compliance results in negation of the consent and established business relationship defenses.1123 A complian

Federal Deception Law: 6.8.5 State Junk Fax Laws

Many states have their own laws forbidding junk faxes. These statutes may make useful parallel claims, as there may be additional remedies and fewer jurisdictional issues.1150 For example, the TCPA does not provide for attorney fees for a prevailing plaintiff.

Fair Debt Collection: 11.2.2.2 “Transaction of Business” Test in Long-Arm Statutes

Courts usually interpret the statutory “transaction of business” test as broadly as possible within the minimum contacts standard required by the due process clause of the Fourteenth Amendment. The Supreme Court, in International Shoe Co. v. State of Washington,40 required that the nonresident defendant have minimum contacts with the forum state “such that the maintenance of the suit does not offend ‘traditional notions of fair play and substantial justice.’”41 McGee v.

Fair Debt Collection: 11.2.3 Federal Court Venue

Federal suits may be brought in any judicial district in which the defendant “resides, if all defendants are residents of the State in which the district is located” or in which a substantial part of the events or omissions giving rise to the claim occurred.57 The federal venue provisions should therefore be construed to permit suit to be brought in any competent federal court of a state that has long-arm jurisdiction over the defendant.58 Unlike claims of improper jurisdiction, objections to venue

Fair Debt Collection: 11.3.1 Overview

Creditors, debt buyers, or those collecting on behalf of creditors or debt buyers often seek to thwart a consumer’s FDCPA or state claims by attempting to enforce a mandatory arbitration clause found in the credit agreement between the original creditor and the consumer. These clauses require consumers to bring legal claims in private arbitration as opposed to litigation in court.

Fair Debt Collection: 11.3.2 Defendant Must Produce Arbitration Agreement Binding on the Consumer

Debt buyers and debt collectors wishing to take advantage of the arbitration agreement entered into between the consumer and the creditor have the burden of presenting to the court that actual arbitration agreement. The Federal Arbitration Act does not require arbitration of disputes, but only enforces arbitration agreements that have been validly created. Production of the actual agreement is also essential to determine what parties and disputes are covered by the agreement and whether any aspect of the agreement is unenforceable.