Pub. 17 2018-2019 Issue 1

N E W J E R S E Y C O A L I T I O N O F A U T O M O T I V E R E T A I L E R S 27 new jersey auto retailer W W W . N J C A R . O R G MARKETING YOUR DEALERSHIP  continued on page 28 Unsolicited telemarketing phone and text messages must also have an automated opt-out mechanism. Dealerships may NOT send a text message requesting a customer opt-in. The consent to autodial or leave a prerecorded message on a consumer’s cell phone is also limited to a particular transaction and cannot be used to autodial a customer about all the dealership’s promotions without the express consent of the consumer. To be safe, dealerships that call or text message consumers or leave prerecorded messages on cell phones, should interpret a consumer’s request for revocation broadly to avoid a lawsuit over the scope and breadth of the con- sumer’s revocation of consent. According to the court in ACA International, under the FCC’s interpretation, “any uninvited call or message from the device is a statutory violation” and thus any smartphone could have fallen within its definition especially if, either through app downloads or software additions, the phone functioned as an auto-dialer. This would create liability, the court found, for even an average person sending out a group invitation to a social gathering via text. For dealerships, this meant a well-meaning employee’s reminder to a customer for service or informing a potential car buyer of a promotion, could fall under the statute’s purview, and subject the dealership to a fine up to $1,500 per call/text. Leaving parties “in a significant fog of uncertainty,” the court invalidated the FCC’s expansive interpretation such that a smart phone by itself will no longer be akin to an ATDS. As a result of the court’s ruling, the FCC now has to go back to the drawing board to define an ATDS, with the focus not on the “potential functionalities” of the device but actual use and whether or not human intervention is required. The Impact of the TCPA on Your Dealership In recent years, TCPA litigation has run rampant in New Jersey courts (and across the country), given the statutes’ high penalties, private right of action, and broad provisions. This has led legiti- mate businesses to be besieged by lawsuits under the Act. Cases involving the TCPA represent the second highest filing in U.S. federal courts and the lawsuits have resulted in millions of dollars in judgments and settlements. In Nelson v. Santander Consumer USA, one automobile refinanc- ing company was ordered to pay a $571,000 judgment – for calls to only one plaintiff. Likewise, in March 2018, a Har- ley-Davidson dealership became the target of a proposed class action for allegedly making pre-recorded telemarketing calls to an individual on the Do Not Call Registry, in violation of the TCPA. The Institute for Legal Reform has found that in the 17 months following the FCC’s 2015 Order, there was a 46 percent increase in the number of TCPA lawsuits. Further, the types of mass marketing that is restricted by the TCPA lends itself easily to class-action lawsuits and creates the potential for significant liability for dealerships. Despite the ruling in ACA International , dealerships need to remain vigilant. A text appointment reminder, a thank you text, or a ve- hicle ready notification text would most likely not be within the TCPA’s purview. For example, texting customers about service appointments and sending reminders of the appointment without prior express written consent is acceptable, as repair messages are not likely to be viewed as a marketing message. Thus, written consent, based on the repair order, will not be required. There is, of course, some risk in cases where a text message does not only concern services that were already purchased. For example, if a customer brings a car in to get their windshield wipers replaced, but a dealer texts the customer that her tires need to be replaced for $200. This can likely be viewed as a marketing message to sell other automotive services/products. Thus, prior express written consent would be required because this would be viewed as a marketing message. In addition, sending customers pictures or videos of vehicles would also, most likely, be viewed as marketing, even if the cus- tomer previously expressed an interest in a particular vehicle. Under the TCPA, a text message is characterized as “telemarket-