Summary
The Seventh Circuit affirmed the district court's grant of summary judgment in favor of Zipongo Inc., holding that its calls and text messages promoting free nutritional services did not constitute "telephone solicitations" under the Telephone Consumer Protection Act (TCPA). The court interpreted the statutory term "encouraging the purchase" to require a direct intent to persuade the recipient to pay for a service, rather than merely making a transaction more likely to occur. Because the communications were directed at securing free services funded by the plaintiff's healthcare plan, they fell outside the TCPA's prohibition.
Topics
Practice areas
Questions Presented
- Whether calls and text messages promoting free nutritional services available through Hulce's healthcare plan constituted "telephone solicitations" under 47 U.S.C. § 227(a)(4) and 47 C.F.R. § 64.1200(f)(15).
- Whether the communications were initiated for the purpose of encouraging the purchase of property, goods, or services when Hulce was encouraged to use services that were free to him, although Foodsmart could receive payment from his healthcare plan.
Holdings
- A telephone solicitation requires the initiation of a call or message for the purpose of persuading or urging someone to pay for property, goods, or services. The person or entity intended to be encouraged must be the party making the purchasing decision.
- Foodsmart's calls and messages were not telephone solicitations because they encouraged Hulce to use services that were free to him and did not seek to persuade Hulce to pay for services or CCHP to make a purchase.
- Summary judgment for Foodsmart was proper because Hulce's claims depended on communications qualifying as telephone solicitations, and the undisputed facts established that they did not.
Key quotations
“We therefore conclude that “telephone solicitation” means the initiation of a call or message for the purpose of persuading or urging someone to pay for a service.” (at 504)
“Foodsmart’s calls and messages do not fall within the definition of “telephone solicitation” because Foodsmart did not initiate them with the purpose of persuading or urging anyone to pay for its services.” (at 505)
Factual background
Zipongo Inc., doing business as Foodsmart, provided nutritional consultations through healthcare plans, including CCHP, at no cost to plan members. Foodsmart contacted James Hulce, a CCHP member enrolled through Wisconsin's BadgerCare Plus program, with calls and text messages about free nutritional services, giveaways, gift cards, and nutritional assessments. Hulce alleged that he received approximately twenty communications while listed on the national do-not-call registry and after requesting that the communications stop. Foodsmart billed or received payments from CCHP when members used its services, but Hulce himself was not required to pay.
Procedural history
Hulce filed a putative class action in the Eastern District of Wisconsin, alleging that Foodsmart, doing business as Zipongo Inc., initiated prohibited telephone solicitations to him while he was on the national do-not-call registry and despite his requests that the communications stop. After an initial discovery period, Foodsmart moved for summary judgment. The district court held that the communications did not constitute telephone solicitations and granted summary judgment; the Seventh Circuit affirmed.