On August 12, 2024, a California federal court dismissed a complaint with prejudice, finding, among other things, that text messages sent to the plaintiff to recruit him for employment did not constitute a “solicitation” under the Telephone Consumer Protection Act (TCPA). This is a critical development in TCPA litigation, specifically for businesses sending text messages in California.
In Anderson v. Nexa Mortgage, LLC, the plaintiff alleged that the defendant contacted him four times during a three-day span in March 2024. The dates here are significant, because the plaintiff alleged that he had registered his cell phone number on the Do-Not-Call Registry in 2019 (thus, at least 30 days prior to the alleged text messages and voicemail; any fewer days would constitute a potential defense under the TCPA). The first three alleged communications were text messages purporting to recruit the plaintiff for employment, while that fourth alleged communication was a voicemail left by the defendant’s “Recruiting Manager” to “follow up on the text messages.”
The court turned to the TCPA to determine whether the text messages and voicemail were violative. According to the court, it is prohibited to initiate more than one “telephone solicitation” to the same person within a twelve-month period. The main crux of this case came down to whether the four text messages, or the one voicemail, constituted “solicitations” under the TCPA.
Ultimately, this United Stated States District court for the Central District of California agreed with the defendant that “the communications were not ‘solicitations’ within the meaning of the TCPA,” because under the TCPA a solicitation is a “telephone call or message for the purpose of encouraging the purchase or rental of, or investment in, property, goods or services.” Instead, the court found that the primary purpose of the challenged communications was “to encourage [the plaintiff] to enter into an independent contractor relationship with [the defendant].”
The court granted the defendant’s motion to dismiss with prejudice after finding multiple other insufficiencies with the plaintiff’s amended complaint. For example, the plaintiff had also failed to adequately allege that the defendant used an Automatic Telephone Dialing System (ATDS) or prerecorded messages.
The Andersen case comes just a few months after the Southern District of New York analyzed a somewhat similar “solicitation” issue under the TCPA, while coming to a different conclusion, in July 2024. In Cacho v. McCarthy & Kelly LLP, the plaintiff had allegedly received multiple calls from a man who had asked the plaintiff whether he or any of his family members had spent time at Camp Lejeune between a certain timeframe and had suffered from disease “like cancer.” The alleged solicitation in that case was an offer to legally represent the plaintiff with respect to “potential claim(s) against the United States Government in connection with injuries from exposure to contaminated water at Camp Lejeune, North Carolina.”
In Cacho, the court noted that under the offered legal agreement, the defendant would receive compensation in the form of a contingency fee, i.e., a portion of the plaintiff’s recovery on his claim. Significantly, the contract stated that “in the event no recovery is made, [the plaintiff] will not owe … [the defendant] any sums whatsoever as attorneys’ fees….” Thus, one main issue for that court to consider, was whether the challenged calls had encouraged the “purchase” of the defendant’s legal services or whether the actual payment of a contingency fee to the defendant under the agreement would be too remote or contingent to establish a purchase under the TCPA.
The Cacho court noted that, while technically the legal agreement did not require the plaintiff to pay any money directly to the defendant, the court must still apply “common sense” rather than a “rigid formalism” to decide whether the calls sought to encourage a purchase of services under the TCPA. Ultimately, that court concluded that the alleged calls did in fact constitute telephone “solicitations and telemarketing” for purposes of the TCPA, because the plaintiff had adequately pleaded that the purpose of the calls was to encourage him to purchase the defendant’s legal services by entering into a legal agreement for claims arising out of injuries sustained at Camp Lejeune.
Generally speaking, both Andersen and Cacho cases focused on whether purported communications were attempts to sell something, i.e., receive money. It seems that under the TCPA when a communication is meant to provide someone with money or compensation, as opposed to receive money or compensation, the courts dive deep into the issue to analyze whether the communication was in fact a “solicitation.” It is interesting to imagine what new types of TCPA cases may come out of the courts in the coming months to determine whether a communication is ultimately offering to sell something, or conversely, offering to provide something to the recipient of the communication.
Together, these two cases bring to light the continued focus and analysis of the courts on the issue of whether an alleged communication constitutes a “solicitation” under the TCPA. Businesses who implement text messaging should pay close attention to these outcomes, diligently review the legal purpose of their communications, and analyze whether the communications they intend to send may constitute a “solicitation” under the TCPA.