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In this video, we review City Select Auto Sales v. David Randall Associates. It’s a little different than the cases we usually review because it doesn’t involve SMS messaging—this case is about faxing. Faxing technology involves scanning and sending a document from one machine to another. The receiving machine prints the scanned document.
Why a Faxing Case Is Relevant Today
The Telecommunications Protection Act (TCPA) was written in the early 1990s and originally encompassed phone calls, faxes, and other forms of communication of the time. SMS messaging wasn’t covered in the TCPA because it didn’t exist. Even though faxing isn’t as relevant today, this is an important case that helps us better understand who can be held liable for TCPA violations of any kind.
Summary of City Select Auto Sales v. David Randall Associates
The plaintiff in this case was the owner of City Select Auto Sales. He received unsolicited faxes advertising the services of the defendant, David Randall Associates. This local roofing company ultimately reached over 12,000 people in the community by fax, resulting in a judgment of $22 million in favor of the plaintiff.
David Randall and his wife owned 90 percent of the company. To grow the business, he hired someone to help with marketing and asked her to develop a faxing campaign to advertise the company. She used a fax broadcaster, a provider like Tatango but for mass faxing rather than mass texting. This person worked with the broadcasting company to send messages to businesses in their area.
This strategy resulted in a class-action lawsuit. In a class action, the plaintiff represents many individuals allegedly wronged by the defendant. These class-action cases can lead to a higher payout because they include all damages for all people affected. The plaintiff, in this case, won at trial for $22 million in what turned out to be a very clear TCPA violation, decided before the trial.
Did This Small Roofing Company Have to Pay $22 Million?
Here’s where this case gets interesting. David Randall Associates didn’t pay that amount. The trial focused on determining whether the company’s owner could be held personally liable for the damages presented in discovery. The company’s assets didn’t even come close to $22 million, so City Selects Auto Sales wanted to go after David Randall’s personal assets.
City Selects Auto Sales lost this case at trial. The jury found that David Randall wasn’t directly involved with the marketing campaign. Because Randall wasn’t directly monitoring his marketing director, his personal assets were spared. However, the marketing director’s decisions still cost him his company.
Forming a company creates a safety net between the company assets and the owner’s personal assets. In this case, there was no indication that the roofing company was advertising for personal services, just business services.
TCPA Regulations: Local Guidelines Matter
When this case reached the circuit courts, it took place in the Third Circuit, which includes Pennsylvania, New Jersey, Delaware, and the Virgin Islands. This is an important detail because the TCPA is not interpreted and enforced uniformly across the United States. Make sure you’re paying attention to your area’s regional nuances.
How to Make Your Marketing TCPA Compliant
Being proactive about TCPA compliance in your marketing campaigns is so important. If David Randall had been actively managing the faxing campaign, or if any other chief officer was managing an SMS campaign, they could have been held personally liable, and their personal assets could have been exposed.
At Tatango, our top recommendation is to find reliable outside counsel from a TCPA attorney. Ensure any attorney you work with is well versed in TCPA guidelines, particularly with the regional nuances that apply to your company. Our lawsuit review videos aim to help you avoid legal trouble and educate you about the questions you should be asking your TCPA defense attorney. Check out our TCPA Survival Guide for more resources and a directory of TCPA defense attorneys through Innovista Law.
Tatango Can Help You Meet TCPA Requirements
As an industry leader for more than 13 years, Tatango provides expert guidance, and our text message marketing platform includes tools to help you meet TCPA consent requirements to reduce your risk of litigation. Contact us today to learn more.