That Works: One Recruitment SMS Blast Yields $6.5 Million Settlement

Published On October 31, 2013 | By Mason Weisz | General, Litigation
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imessageDocuments filed this week in the U.S. District Court for the Southern District of Florida reveal that a Florida mall developer and its mobile marketing service provider have agreed to pay $6,500,000 to settle claims that a single text message sent to 90,000 Florida residents without their consent violated the Telephone Consumer Protection Act (“TCPA”) and related regulations issued by the Federal Communications Commission.   Under the version of the FCC’s TCPA regulations in effect at the time the message was sent, it was unlawful to use certain automated equipment to send a text message without the recipient’s prior express consent.  (An update to the FCC’s TCPA regulations that took effect on October 16, 2013 imposes more stringent consent requirements for marketing-related text messages.)

The complaint alleges that the defendants obtained the cell phone numbers of approximately 90,000 West Palm Beach residents through indirect means such as scraping a voter registration database.  The defendants then allegedly sent the following text message to those numbers without first obtaining the recipients’ prior express consent:

“Over 1500 construction jobs are available for the New Palm Beach Mall. Attend the Job Fair tomorrow Aug 21 Gaines Park 9-4 PM Register at”

Under the proposed settlement agreement, the plaintiff’s attorneys have agreed to petition for no more than $2,145,000 of the $6,500,000 agreed maximum monetary payment.  Individual recipients of text messages would be able to complete a claim form and receive up to $150 each, depending on the number of claimants.  Given that the TCPA provides for statutory damages of $500 per violation, or up to triple that in the event of willful or knowing violations, the proposed settlement provides for a substantially smaller monetary payment than the approximately $45,000,000 to $135,000,000 that was potentially at issue in this dispute.

The case is now captioned Lanza v. Upscale Events By Mosaic, LLC d/b/a The Mosaic Group and Palm Beach Mall Holdings LLC, 13-CV-80093.

About The Author

Mason helps clients navigate a constantly shifting web of domestic and international laws regulating data collection, marketing, data sharing, computer crime, data security, electronic surveillance, online content, children’s privacy, financial privacy, information management, and other areas of privacy and Internet law. A former web designer, he has extensive experience with issues relating to digital media, new technology and e-commerce.