SMS Marketing: Understanding Telephone Consumer Protection Act Liability

Derek Johnson: Hi, everyone. Derek Johnson with I’m here with Joe Bowser from Innovista
Law and the TCPA Defense Force. And we’re talking today about who is responsible
for TCPA compliance. And I guess who’s responsible and then who’s
held accountable, I guess are two different kinds of…or maybe they are the same thing,
right? Joe Bowser: Well, I think lawyers would use
the term liability. Derek Johnson: Okay. Joe Bowser: Who’s liable for the SMS in
question, but that’s a different way of saying responsibility. Derek Johnson: Okay. Joe Bowser: In terms of if the plaintiff gets
a judgment against you, who has to satisfy it? Derek Johnson: Okay. Joe Bowser: Right? Derek Johnson: And I guess there’s a lot
of different players in text message marketing. You have the brand, so let’s say the retailer. You have software providers like Tatango. You have marketing or digital agencies that
might be helping a brand use a software provider like Tatango. Who’s responsible, and who gets sued? Who gets to back out of the lawsuit? I’ve heard a lot of different kind of opinions
on this, so maybe you can help me out. Joe Bowser: Sure. Well, so let’s just start with the law. Derek Johnson: Yeah. Joe Bowser: So the law holds the sender or
the initiator of a message liable. Derek Johnson: Okay. Joe Bowser: So the question is, who sent it
or who initiated it? Right? So, that can get us back to the brand. So a brand doesn’t absolve itself of liability. It can’t just wash its hands of TCPA liability
just because it hired a third party to hit send on a message to develop the campaign,
right? So your campaign can be liable if they’re
actively involved. The platform provider can be liable. Derek Johnson: Okay. Joe Bowser: If they’re actively involved. And all three can be liable, if they’re
actively involved. So the court sees a test of what’s called
vicarious liability. So the person to hit send is necessarily liable
because they’re the sender. Derek Johnson: Okay. Joe Bowser: But you can go upstream to find
out who hired them. So it might be an agency. It might be the brand directly. But just like when the UPS driver rear-ends
you in the street, you can sue the driver and you can sue UPS. Derek Johnson: Okay. Joe Bowser: Because that driver is doing UPS’
business. It is a so-called principal-agent relationship. Derek Johnson: Okay. Joe Bowser: UPS is the principal. They’re getting paid to deliver the package. And that driver is the agent. And someone who’s injured in what’s called
a tort claim – and TCPA is a tort claim – can sue anybody who caused their damages,
or all of them. Derek Johnson: Interesting. Joe Bowser: So, typically, the plaintiff’s
attorney will sue everybody. Derek Johnson: Yeah. Joe Bowser Right? And then you start looking. Who’s got the deep pockets? Who may have insurance? And then, between the defendants, you start
looking at, what do the contractual arrangements between the three of you say? Did one of you agree to defend and indemnify
me? Did one of you agree to take responsibility,
exclusive responsibility? Derek Johnson: So it’s more a contractual
between the parties. Joe Bowser: Right, but the plaintiff never
has to care about any of that. Derek Johnson: They don’t care. Okay. Joe Bowser: Because they get to sue all of
you. Derek Johnson: Yeah. And you have to figure it out with everybody
else. Joe Bowser: On the back end. Derek Johnson: Yeah, okay. Joe Bowser: But the court can hold anyone
who qualifies as a sender liable. And so anyone who has an active role in the
delivery of that message that violated the TCPA can be held liable. Derek Johnson: Interesting. Joe Bowser: So you don’t wash your hands
just because you hired a third party. That’s the classic UPS… Derek Johnson: I’ve heard about like, “An
agency’s doing it, it’s not my problem.” It is your problem essentially. Joe Bowser: If it’s your good or service
being promoted, you should assume you have exposure. Derek Johnson: Okay. And what are the penalties? I know we’ve reviewed this in other videos,
but how much exposure are we talking here? Joe Bowser: The base statutory damages under
the TCPA is $500 per call. And if you are shown to have willfully violated
the law, it’s $1,500 a message. Derek Johnson: Wow. Joe Bowser: Each message. Derek Johnson: Each text message, each person. Joe Bowser: Each message to each person. Derek Johnson: So this is not something you
want to take lightly. And even if you have three different parties,
you still need to be compliant, and still be concerned and aware of the TCPA, because
this is not something you can kind of shift blame, and it’s very expensive obviously. Joe Bowser: The exposure is quickly in the
millions and not uncommonly into the billions. Derek Johnson: Wow. Do you think, as an attorney, should each
party have their own attorney? Should they all be working together on TCPA
compliance? I know a lot of brands use agencies that use
software that have different, you know, people involved in the campaign. What are some best practices as to how to
get everybody compliant? Joe Bowser: Well, certainly, attorneys should
be involved at each stage because there are times when one attorney can’t represent
all three. Derek Johnson: Okay. Joe Bowser: Like the defense and indemnification
provisions we were talking about. So if the brand wants the agency to assume
more responsibility, that attorney can’t… Derek Johnson: So that’s the contract law
between the parties. Joe Bowser: Exactly. Derek Johnson: Okay. And then in terms of, like, setting up the
campaign and running the campaign, like, you know, the double opt-in message, the disclosures
that, you know, are shown to the consumer when they opt in, it seems like kind of everybody
needs to be involved. And everybody needs to be aware of the TCPA
because if one person isn’t, that can screw everybody. Joe Bowser: Well, right. If the attorney’s only at the brand level
and they’re not getting good intel back from the agency or the marketing company about
what’s actually going out the door, it didn’t matter if you approved the campaign, if it
adapts along the way. Derek Johnson: Okay. Joe Bowser: So you want to keep them involved
because, again, the TCPA has many inflection points about who you’re calling, what you’re
calling about, what…whether it’s an informational or a marketing call or a message. So you want to make sure that everyone is
towing the line as the message goes out. Derek Johnson: It seems almost like from a
software provider standpoint, as a brand, you know, a software provider, they’ll always
say they’re TCPA compliant, but, you know, maybe a brand shouldn’t take that, you know,
just as-is. They should also, you know, have their own
counsel review things, as well, because, again, the brand is liable at the very end of the
day, as well. Joe Bowser: I don’t even know what that
means, to say that a platform provider is TCPA compliant. Derek Johnson: Yeah. Joe Bowser: Because if they’re not involved
in what the messages are saying, if they’re not involved in the achievement of consent
before those messages go out, if they don’t have visibility into that… Derek Johnson: They can’t determine it. Joe Bowser: They can’t put a seal of approval
when they’re missing key pieces of the puzzle. Derek Johnson: So it sounds like just everybody
needs to be involved in TCPA compliance. Everything, from the people that are composing
the message to the software that’s built it, the attorneys, everybody needs to be on
the same page. So that, you know, one part of the component
is not, you know, having issues and no one else knows, and everyone else is liable for
that one component. Joe Bowser: Right. Just because Microsoft provides Outlook doesn’t
mean that Microsoft knows whether the email I’m about to send defames someone or violates
someone’s IP. Derek Johnson: Interesting. Wow. Okay, so it really comes down to that, really
everybody involved in the chain is liable for TCPA violations. So that’s why it’s so important for, I
think, brands and software providers and attorneys and marketing agencies all to get on the same
page, come up with a strategy, and really make sure that they’re following the TCPA
to the T. Joe Bowser: Right, because the TCPA, at the
end of the day, is designed to keep consumers happy. So the last thing you want is your agency
to go off on a rogue campaign. Derek Johnson: Yeah. Joe Bowser: It damages the brand. Derek Johnson: Yeah. Joe Bowser: And you just got yourself exposed
to a whole bunch of TCPA lawsuits because they’re promoting your product. Derek Johnson: Yeah, so really having a good
view of everything that’s going on. Joe Bowser: You’re in court and your consumers
are upset. Derek Johnson: Yeah, that’s the worst. Well, that is definitely something you do
not want to do as a text message marketer. Again, my name is Derek Johnson, with,
sitting with Joe Bowser from Innovista Law and the TCPA Defense Force, and we’re answering
your TCPA text messaging questions. Thanks for watching our video today. If you liked this video, be sure to give us
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