Wednesday, April 23, 2014

Buffalo Bills Alleged Over-Texting Results in Multi-Million Dollar Settlement

The National Football League’s Buffalo Bills, no strangers to disappointment on the field, are now a cautionary tale for mobile marketers. Last week, a federal judge in the Middle District of Florida approved a class settlement agreement over alleged violations of the Telephone Consumer Protection Act (“TCPA” 47 U.S.C. §227, et seq.), stemming from text messages sent by the Bills to fans who had explicitly signed up to receive texts from the team.

According to the complaint filed in October 2012, Bills fan Jerry Wojcik visited the Bills website to read news about the team and learned about the Bills text alerts program, under which fans could sign up to receive team news by text message. The program was explicitly opt-in; only fans who signed up would receive text messages. Further, subscribers could cancel their subscriptions at any time. The program description was quite specific, reading, in part: “You will be opted in to receive 3-5 messages per week for a period of 12 months. Text STOP to cancel.”

Mr. Wojcik signed up for the text program and began receiving texts. One week, he allegedly received 6 messages. Another week, he allegedly received 7. Noting that the program terms had stated that he would receive 3-5 messages per week, he sued, on behalf of himself and all others similarly situated, alleging a massive violation of the TCPA and seeking damages of up to $1500 for every text above the permitted 5/week. A year and a half later, the parties have agreed to a settlement potentially worth as much as $3 million (depending on the number of claimants who come forward), including approximately $500,000 in attorneys’ fees and costs for Wojcik’s lawyers.

The Bills’ unfortunate experience is an important lesson for anyone who uses text messaging as a marketing tool. After all, the Bills did nothing more than send text messages to fans who had explicitly signed up to receive them, and who could at any time ask to stop receiving them. It’s difficult to see how anyone was harmed by this. Nevertheless, they ultimately made the calculation that this settlement was preferable to continuing down the long path of litigation. This has to do in part with the cost of complex class action litigation, and in part with the TCPA itself. The law requires a company to obtain prior express consent before using automated technology to send mass texts, and provides for statutory damages of $500 per negligent violation, or $1500 per willful violation. In the case of a mass text campaign, the potential statutory damages can quickly add up to a very large amount.

Companies utilizing text messaging should take care in crafting their program terms and conditions. The Bills’ Text Alert program, with its specific statement that subscribers were “opted in to receive 3-5 text messages per week,” presented a tempting target, because it allowed the argument that subscribers had not consented to receive any text in excess of 5 per week, even it was just a single extra text. Additionally, companies need to ensure that their actual practices are consistent with the disclosures in their terms and conditions. Unfortunately, TCPA litigation can be costly, regardless of a case’s merits, but there are steps companies can take to reduce their risk of becoming a target.

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