iSo the Czar has been out for a couple of weeks, which means we have a backlog of cases to get through together. No worries, I will blog a couple of these a day until we are all caught up.
First on the agenda, a new case out of Missouri that really sinks the hopes and dreams of companies that send unsolicited messages to consumers offering to buy their homes for cash.
While the general rule remains that offers to buy are not solicitations, courts have been carving out an exception where messages are sent to buy people’s home for an effective fee–a lower than market price.
In McMorroe v. Core Properties, LLC 2023 WL 8697795 (E.D. Mo. Dec. 15, 2023) the Defendant took a MASSIVE hit when the Court entered summary judgment on liability AGAINST the Defendant. Holy smokes.
In McMorroe the Defendant was sued for text messages sent by a third-party marketer sent to consumers in an effort to buy their homes. The Defendant argued that it was not responsible for these messages as it did not send the messages directly–but the Court quickly dispatched with that argument in light of Core Properties’ licensing of its name to the marketer:
Core Properties entered into a licensing agreement with Growth Development whereby Growth Development can use Core Properties name, branding, and the Core Properties website at corepropertiesstl.com. Growth Development contracted with 1000 CAD to perform an outgoing text message campaign to solicit the purchase of its services. As part of this agreement, Growth Development sent consumers’ contact information to 1000 CAD, including Plaintiff’s contact information.
I will say, it is odd to me that CP’s license to GD somehow created liability for actions of CAD in the Court’s mind. (This is like some sort of geometry puzzle here CP = GD > CAD, right?)
In any event, the Court found CP afforded apparent authority to CAD to act on its behalf and that was all that was needed in the court’s mind to hold CP liable here.
On the bigger substantive question–i.e. is a text offering to buy something a solicitation, the Court looked at practical concerns. Essentially because the message was sent for profit the court found the message was solicitation:
Despite Defendants’ arguments that the text messages were merely meant as an offer to purchase Plaintiff’s home, in reality, this offer is coupled with the offer to provide Plaintiff with a service for an effective fee
In selling a home to Growth Development utilizing Growth Development’s services, Plaintiff or other consumers lose out on either the benefit of the higher price paid by a third-party purchaser or the fee charged for the assignment of the purchase contract to a third-party purchaser
Eh..I guess.
Recalling that the definition of solicitation requires that the consumer actually be offered something for sale or rent it is tough to see how these calls meet that definition. I understand the theory is the consumer is being sold a “service” of the home buyer, but is it really paying for that service in any real sense? Seems like the buyer is just trying to get the seller to agree to sell for less–but that’s jus ta negotiation on the price of a home is it not?
Regardless, those in the business of buying homes need to be extremely cautious with outbound calls or texts made without consent these days. The case law is NOT developing favorably.
