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Court Rules TCPA Plaintiff Must Allege Marketer Knowledge That Third Party Vendor Violating the Law to Impute Liability

Court Rules TCPA Plaintiff Must Allege Marketer Knowledge That Third Party Vendor Violating the Law to Impute Liability

On July 9, 2020. the Northern District of California dismissed a Telephone Consumer Protection Act class action alleging that a third party sent an unsolicited text message to plaintiff’s mobile telephone.  The court held that plaintiff’s allegations did not establish that defendant was legally responsible for the conduct of the third party sender.

Postmates, Inc. operates a mobile application “Urban Logistics platform” that connects its customers to thousands of delivery drivers who are signed-up in its network to provide deliveries of food, groceries, and other items.

Plaintiff Richard Rogers initiated a putative class action under the TCPA after allegedly receiving an unsolicited text message on his cellular phone with a hyperlink directing him to a job board on defendant Postmates website.  According to plaintiff, in an effort to advertise its delivery service and encourage plaintiff and other class members to sign-up to become delivery drivers, Postmates contracted with Bird Dog Media, LLC, one of its marketing agents, to promote its mobile application and driver opportunities to as many individuals as possible.

As part of these efforts, according to plaintiff, Bird Dog sent thousands of text messages on behalf of Postmates to individuals encouraging them to sign up for Postmates’ delivery-driver network.

Importantly, plaintiff asserted that Postmates “specifically oversaw, monitored, tracked, realized and appreciated the results” of Bird Dog’s marketing campaign, including through use of campaign parameters embedded within the URLs to which individuals were directed by Bird Dog’s texts.  Plaintiff also claimed that Bird Dog was at all times acting on behalf of Postmates pursuant to a marketing campaign that Postmates authorized, contracted for with Bird Dog, and paid Bird Dog to conduct.

For its part, Postmates was aware, or should have been aware, that Bird Dog was sending such text messages on its behalf, and knowingly allowed and permitted Bird Dog to conduct such marketing using an automatic telephone dialing system without first securing express written consent, plaintiff alleged.

Postmates moved to dismiss plaintiff’s complaint, arguing that plaintiff failed to allege facts sufficient to show that Postmates is vicariously liable for Bird Dog violating the TCPA.

There are two potential theories of liability under the TCPA.  Direct liability and vicarious liability.  Because the parties did not dispute that the actual sender of the text was not Postmates, but Bird Dog, direct liability was inapplicable.  Consequently, in order for plaintiff to survive Postmates’ motion to dismiss, plaintiff was required to allege plausible facts plausibly suggesting that the third party caller Bird Dog acted on Postmates’ behalf, that Bird Dog’s action were  subject to Postmates’ control, and that Postmates was consequently vicariously liable for the text messages sent by Bird Dog.

The extent of control exercised by Postmates over Bird Dog’s telemarketing efforts was an essential consideration.

First, the court considered that plaintiff did not allege that Postmates exercised the control over Bird Dog necessary to establish Bird Dog as Postmates’ agent.  Rather, plaintiff alleged that Postmates contracted with Bird Dog “to promote its mobile application and driver opportunities to as many individuals as possible” through a marketing campaign.  Plaintiff also alleged that  Postmates “specifically oversaw, monitored, tracked, and realized and appreciated the results of” the campaign.

In doing so, plaintiff alleged that it was Bird Dog that “conducted” and “performed” the campaign, and does not dispute that Bird Dog was the party who sent the text.  “Absent from the [complaint] are allegations that Postmates exercised any control over the ‘manner and means’ in which Bird Dog executed the campaign on its behalf,” the court stated.  “There are no allegations here that Postmates directed Bird Dog to send text messages as part of the marketing campaigns; that it dictated the content of any message or other communication sent by Bird Dog; that it identified or otherwise controlled to whom or how or when Bird Dog sent such communications; that it equipped Bird Dog with any technological capability or other insider information necessary for executing the marketing campaign; or even that it ‘controlled’ or ‘directed’ Bird Dog in any way.”

The court noted that there as “no allegation that Postmates communicated to Bird Dog that text messages could or should be part of the marketing campaign.”

Just because Postmates would want to keep an eye on the marketing campaign results to know whether it was paying off does not mean that it was directing things or had the right to control the manner and means of the text messages sent.

Next, the court considered that Postmates was not alleged to have had any control in preparing the texts, and that plaintiff failed to alleged facts that Postmates ratified alleged TCPA violations by knowing that Bird Dog was referring people through texts in alleged violation of the TCPA, or through willful ignorance thereof.

Knowledge that an agent is engaged is a “commonplace marketing activity” like text messaging is not enough to impose vicariously liability, the court concluded.  “Here, [plaintiff] has only alleged that Postmates was aware that Bird Dog was ‘sending text messages on its behalf.’  He has not alleged any other ‘red flags’ which would have led a reasonable person to investigate whether Bird Dog was violating the TCPA.”

According to the court, plaintiff failed to allege that Postmates had some degree of control over who sent the text and the manner and means by which it was sent.  The court held that plaintiff failed to plead facts plausibly suggesting that Postmates exercised any direction over the content of the text or the manner and means by which it was sent.

The matter is Rogers v. Postmates Inc., No. 19-cv-05619-TSH, 2020 WL 3869191 (N.D. Cal. July 9, 2020).  This decision amply illustrates the need to consult with an experienced FTC defense lawyer when assessing various considerations involved in structuring and scrutinizing vendor relationships.



Richard B. Newman is an FTC defense lawyer focusing digital advertising and marketing matters at Hinch Newman LLP.  Follow him on Twitter @ FTC defense attorney.

Informational purposes only. Not legal advice. May be considered attorney advertising.

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