LaForce be With You: My Big Arbitration Win from 2017 Aids Defendant in New Pre-Checked Box TCPA Consent Fight—Plus Court Holds “No Magic Language” Required in Consent Disclosure

Buckle up folks because this is a really interesting one. Two big issues at stake in this case and both come out in favor of the Defense.

First, pre-checked boxes. People ask me all the time: “Czar, can our disclosure box be pre-checked or does the consumer have to affirmatively check the box?” And I always give roughly the same answer: “While I’ve had success arguing the box can be pre-checked, not everyone has been so lucky so—be careful.”

Amongst the “success” I reference is a fairly obscure—but critically-important—TCPA win in La Force v. GoSmith, Inc., No. 17-cv-05101-YGR, 2017 WL 9938681 (N.D. Cal. Dec. 12, 2017) in which my team successfully enforced an arbitration clause where the terms and conditions disclosure box was pre-checked. The Court found—correctly—that the fact the box was pre-checked did not defeat a finding of mutual assent and acceptance of the disclosures.

Flash forward to this week and we find another Defendant on the ropes in a TCPA suit hoping to enforce a pre-checked box disclosure. Only this time the disclosure in question is an express consent disclosure, not an arbitration disclosure. See Lundbom v. Schwan’s Home Serv., Case No. 3:18-cv-02187-IM, 2020 U.S. Dist. LEXIS 91577 (D. Or. May 26, 2020). Following LaForce, the Lundbom court held that the express consent disclosure was still binding on the Plaintiff despite the fact that the box was pre-populated—which is a really big win folks.

But Lundbom is important for more than just the pre-checked box issue. Indeed, the Lundbom defendant rather-miraculously dodged numerous bullets to get to a successful summary judgment win. Let’s break it down.

Lundbom is an online account creation case. When the Plaintiff created the account he accepted this disclosure:

You agree and consent via your electronic signature by clicking the check box to receive calls at the provided number which will deliver automated, live and/or prerecorded messages, text messages, and text alerts by or on behalf of Schwan’s Home Service.

Ok, that’s a neat and tidy disclosure for informational messages but it does not mention marketing so… not express written consent for marketing purposes right?

Well, hang on.

In creating the account the Plaintiff also accepted a “Stay Connected” disclosure, which authorized Defendant to send “important updates and program news.” And while that language suggests informational texting the Defendant made a clever argument: Come on. We’re a frozen food delivery service. What “important updates” and “news” are we really going to be sending?

Remarkably, this just-crazy-enough-to-work argument actually carried the day. The Court agreed that, in context, the “Stay Connected” disclosure plainly authorized Defendant to send marketing messages related to its products:

Plaintiff registered with Schwan’s to initiate an account with a frozen food delivery service. When viewed in context, this Court finds that a reasonable consumer would understand that “important updates” and “program news” from a frozen food delivery company, whose sole purpose is to sell food products, is likely to include promotional or advertising content related to those services.

Just remarkable stuff. And notice the court is applying a “reasonable consumer” test in assessing whether the Plaintiff was bound by the consent—subjectivity is irrelevant here—and determines as a matter of law that this disclosure was sufficient; the court found no triable issue of fact on the matter and did not send the issue to the jury.

After determining that the express consent disclosure authorizes the marketing material at issue, the Lundbom court turned to the critical issue of the pre-checked box—which brings us back to LaForce. Here’s the key language:

In light of the holding in La Force, and without controlling precedent to the contrary, this Court finds that Plaintiff authorized Defendants to contact her on the phone when she clicked the “Complete Registration” button with the check-box corresponding to phone communications checked. The disclosures and corresponding check-boxes were listed above the “Complete Registration” button. A reasonable consumer would have notice of the check-box because a user would necessarily have to scroll past those disclosures in order to submit a registration. Plaintiff chose to click “Complete Registration.” The Court finds this affirmative act sufficient to constitute clear authorization.

So there you go folks. Maybe express written consent disclosures don’t require specific reference to marketing/promotions after all. And maybe such disclosures can be accepted via a pre-checked box. But I wouldn’t count on it in all instances. Give us a call to talk this through.

 

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