Federal Court Dismisses TCPA Class Action Against Charitable Organizations, Insurance Company
In Short
The Situation: A federal court recently considered the application of the exemption for charities under the Telephone Consumer Protection Act ("TCPA") in a case that also involved a for-profit defendant.
The Result: The court granted the defendants' motion to dismiss, finding that the plaintiff had provided prior express consent and the text messages at issue were merely informational, were not advertisements, and did not constitute telemarketing.
The Facts
In Reese v. Anthem, Inc. et al., the plaintiff, Renee Reese, brought a putative class action complaint against Anthem, Inc., Anthem Foundation, and the American Heart Association ("AHA"). Reese asserted that the defendants violated the TCPA when they sent text messages to consumers nationwide. The complaint asserted both negligent and willful violations of the TCPA (the latter of which would potentially allow for an award of $1,500 per violation).
The complaint alleged that consumers began receiving unwanted texts after they enrolled in AHA's texting program, which the plaintiff initially believed would send out "healthy reminders, such as information about cardiopulmonary resuscitation.…" In support of the allegation that the defendants were involved in an "advertising scheme," the complaint asserted that:
- AHA's goal of the texting program is a "disguise[d]" effort to sell advertising space to its branding partners, Anthem and Anthem Foundation (the latter being the charitable subsidiary of Anthem, Inc., a for-profit health insurance company);
- Anthem and Anthem Foundation both jointly advertised through the AHA text messages (the text messages at issue all began with "AHA/Anthem Foundation"); and
- Additional text messaging sent through the program offered for-pay CPR training classes in violation of the TCPA
The Law
The TCPA's regulations prohibit telephone calls (or texts) that include or introduce an advertisement or constitute telemarketing, using an automated telephone dialing system to a cellular telephone "other than a call made with the prior express written consent of the called party or the prior express consent of the called party when the call is made by or on behalf of a tax-exempt nonprofit organization.…" Thus, calls (or texts) "by or on behalf of" tax-exempt nonprofits are not considered violations.
Relying on prior case law, the court stated that "[a]n individual gives 'prior express consent' to be called or texted at the number provided where she has provided her number to the party calling or texting her, and there is some relation between the communications and the reason for which she provided her number." The plaintiff in this case provided her cell number to AHA when she attended a CPR training event and agreed to receive monthly CPR reminders, healthy messaging information, and questions from AHA.
In trying to avoid the dismissal of the complaint, the plaintiff asserted that she had never consented to receiving text messages from Anthem Foundation and Anthem Inc. The court found the text messages' reference to Anthem Foundation "irrelevant" because the sender was, in fact, AHA. The court concluded: "Plaintiff has not cited any persuasive cases that say a nonprofit's association with a donor or another charitable entity—i.e., Anthem Foundation—gives rise to a TCPA claim when she voluntarily sought to receive certain communications and information."
The court found that the "essential" issue was the nature of the text messages and whether they fell within the scope of the consent that the plaintiff had provided. The court analyzed the actual text messages, finding that the texts regarding CPR and healthy living were "precisely what she received." "To be clear, [p]laintiff did not receive any information about purchasing insurance or information that may financially benefit [d]efendants."
The court also determined that the text messages were informational and not telemarketing or commercial based on the actual texts, even though the recipient could click through to find CPR course providers. The court concluded as a matter of "common sense" that providing recipients with information about, for example, CPR courses provided (whether for-pay or free) by groups like local fire departments is "undoubtedly informational."
Three Key Takeaways
- The Reese decision supports tax-exempt nonprofit organizations that seek to provide information to individuals who have consented to receive the information, depending on the specific facts of the consent and the information that is provided.
- Tax-exempt organizations should review their consent procedures and documentation, as well as the information that they provide individuals, that further support the goals of their organizations.
- Charitable organizations that "partner" with for-profit entities do not necessarily lose the TCPA's exemption for nonprofit entities.
Lawyer Contacts
For further information, please contact your principal Firm representative or the lawyers listed below. General email messages may be sent using our "Contact Us" form, which can be found at www.jonesday.com/contactus/.
J. Todd Kennard
Columbus
+1.614.281.3989
jtkennard@jonesday.com
William F. Dolan
Chicago
+1.312.269.4362
wdolan@jonesday.com
John A. Vogt
Irvine
+1.949.553.7516
javogt@jonesday.com
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