News & Resources

Publications & Media

When Can You Condition Consent to Receive Autodialed Calls / Prerecorded Messages: The Second Circuit Limits a Consumer’s Revocation of Consent

Litigation Law Update Sarah R. Anchors

The federal Telephone Consumer Protection Act limits when businesses can call or text-message customers and potential clients using an automatic dialer or using prerecorded messages or an artificial voice. The call recipient’s consent is generally required, and depending on the message content, that consent may have to be in writing or in writing after certain clear and conspicuous disclosures. Without the right type of consent, consumers may sue for statutory damages of $500 to $1,500 per call or text message.

In 2015, the Federal Communications Commission issued a ruling that individuals can revoke their previous consent-to-be-called (or texted) in any reasonable manner. But the Second Circuit ruled this month that a business’s contract with a consumer can bar a consumer from revoking consent.

In Reyes v. Lincoln Automotive Financial Services, the New York plaintiff agreed to receive telephone calls to his cell phone in signing the lease agreement. After he defaulted on the lease payments, the creditor started calling Mr. Reyes to obtain payment. Mr. Reyes sent a response letter, saying he revoked consent to receive calls to his cell phone. The Second Circuit affirmed summary judgment for the defendant: Mr. Reyes could not revoke his consent to be called because that consent was part of the bargained-for agreement for the vehicle lease. 

This ruling is great news for businesses because it prevents the consumer from unilaterally changing the contract, and limiting the creditor’s ability to contact the consumer. To make consent-to-call part of the agreement, a business should include language like the lease in Reyes, stating that the consumer expressly consents and agrees that the business or its affiliates, agents or service providers may contact the consumer by manually dialing, using prerecorded or artificial voice messages, text messages and/or automatic telephone dialing system, delivered to the telephone number the consumer provides or any other telephone number that the person later provides, regardless of whether it is a cellular device or landline telephone. 

However, it is important to keep in mind that this ruling does not apply to marketing or advertising calls and text messages. A business calling or sending text messages using an autodialer or prerecorded message or artificial voice, containing a marketing or advertising message, must obtain the call recipient’s signed consent (digital or otherwise), after making a clear and conspicuous disclosure that the person is consenting to receive calls or text messages via an automatic telephone dialing system, or using an artificial voice or prerecorded message, to the telephone number provided, and that such consent is not required in order to purchase or receive the business’s goods and services. Because of this last piece, consent to be called or texted with such marketing messages cannot be a condition of a lease agreement or the like.

Sarah Anchors is a partner in the Litigation & Dispute Resolution Practice Group of Quarles & Brady LLP, in its Phoenix, Arizona office. For questions, please contact her at sarah.anchors@quarles.com/(602) 229-5788.