Courts Says Ralph Lauren Should Have Designed a Better Text Message Marketing Program
A decision earlier this month out of the Northern District of Illinois provides important cautionary tales for companies sending marketing text messages, as well as text messaging platform providers. Defendants Ralph Lauren Corporation, Ralph Lauren Retail, Inc., (collectively, “Ralph Lauren”) and the marketing company Ralph Lauren uses, Vibes Media, LLC (“Vibes”), had their motion to dismiss plaintiff Patrick Hudson’s (“Plaintiff”) amended complaint denied. Hudson v. Ralph Lauren Corp., No. 18 C 4620, 2019 WL 1953106 (N.D. Ill. May 1, 2019).
In Hudson, Plaintiff filed a putative TCPA class action suit after allegedly receiving 188 text messages from Ralph Lauren and Vibes (“Defendants”). Id. at *1. In the amended complaint, Plaintiff claimed that Defendants violated the TCPA by “sending him text messages using an [ATDS] without his express consent and by failing to include opt-out instructions in each message.” Ibid.
The facts are where this case is somewhat interesting. The initial text message that Plaintiff received contained the following message:
PoloFactoryStores: Reply Y to get automated offers & ads. Consent is not a condition of purchase. Up to 6 alert msgs/mo.Msg&DataRatesMayApply.Rply STOP to end.
Ibid. Plaintiff replied “Y,” and Defendants went on to send him more than the promised “6 alert msgs/mo.” Ibid. Plaintiff alleged that he received at least 32 text messages over the six alerts per month amount that he had originally consented to. Further, Plaintiff claimed that 80% of texts he received from Defendants did not include any opt-out instructions.
In their motion to dismiss, Defendants argued that Plaintiff pled himself out of a TCPA claim because he admitted in his amended complaint that he provided Defendants with prior express consent to receive the text messages at issue. Plaintiff countered that “Defendants exceeded the scope of his consent by sending him more than six texts in certain months, despite his express agreement to only receive” up to six messages per month. Id. at *2.
So, the court addressed the issue of consent first. In analyzing that issue, the court stated that the “scope of consent must be determined upon the facts of each situation.” Ibid. While Defendants argued that the wording of the initial text message did not limit Plaintiff’s consent, the court noted that Defendants did not cite to any law for support. In fact, the court found that there is at least one case that stands for the exact opposite point Defendants argued for—a case wherein the defendant was found to have exceeded the scope of the plaintiff’s consent because the plaintiff agreed to receive up to three text messages per week and the defendant sent more than three text messages to the plaintiff over two separate seven-day periods. Id. at *3. Thus, in light of that case, and because Plaintiff’s consent did “not preclude a finding that he did not consent to all the messages Defendants sent,” the court declined to dismiss Plaintiff’s TCPA claim against Defendants on the basis of prior express consent. Ibid.
Next, the court addressed the ATDS issue. Defendants argued that Plaintiff “failed to plausibly allege that Defendants used an ATDS to send text messages to his phone.” Ibid. The court first made two conclusions regarding the law surrounding the definition of an ATDS: (1) ACA International is binding on the court, and (2) the court will determine the proper definition of an ATDS in the first instance because several “courts in this district have concluded that ACA International invalidated both the 2003 and 2008 Orders with respect to the ATDS definition.” Ibid.
Next, the court acknowledged that Defendants argued for the court to adopt the ATDS definition adopted by the Pinkus court. The Pinkus court defined ATDS as having “the capacity to generate telephone phone numbers, either randomly or sequentially, and then to dial those numbers.” Id. at *4 (internal citation omitted). The court here ultimately found that, “even under Defendants’ proposed narrow definition of an ATDS,” Plaintiff’s allegations do not foreclose the use of an ATDS. Ibid.
Specifically, the court noted that in Plaintiff’s amended complaint, he alleges that “Defendants used equipment with the ability to store or produce cellular telephone numbers to be called using a random or sequential number generator and to dial such numbers without human intervention,” as evidenced by “the high volume of text messages, the generic and impersonal nature of the messages, and Defendants' use of an SMS code.” Ibid. (internal citation omitted). The court determined that those allegations sufficiently suggest Defendants’ use of an ATDS at the motion to dismiss stage.
Finally, the court addressed Plaintiff’s claim that Defendants’ “failure to include instructions on how to stop receiving Ralph Lauren advertisements in every text message that Defendants sent,” allegedly violated 47 U.S.C. § 227(c)(1) and 47 C.F.R. § 64.1200(b)(3). Id. at *6. Defendants argued that the opt-out requirements only apply to artificial or prerecorded voice messages. Ibid. The court agreed, holding that “because the plain language of § 64.1200(b)(3) encompasses only voice telephone messages and [Plaintiff] identifies no other basis for imposing an opt-out requirement with respect to every text message Defendants sent [Plaintiff], he cannot pursue a claim for violation of 47 U.S.C. § 227(c)(1) and 47 C.F.R. § 64.1200(b)(3) based on the lack of such information in each text message he received.” Ibid.
So, what are the takeaways here? Well, first, if you are going to engage in a text message marketing campaign, stay within your advertised limits. That is to say that, if you, like the Defendants in Hudson, state that you will send the consumer up to six text messages per month, make sure that you are only sending up to, and no more than, six text messages per month to that consumer. Therefore, unless there’s a clear reason to do so, companies should consider obtaining consumer’s consent to receive “recurring” text messages, rather than a specified number per month. Additionally, and although the Defendants in Hudson won on this issue, it cannot hurt to include opt-out instructions frequently. The CTIA guidelines require SMS campaigns to include “opt-out instructions at program opt-in and at regular intervals in content or service messages, at least once per month.” In the long run, it is preferable to make clear how customers can opt-out of marketing messages rather than get caught up in costly litigation.