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What are arbitration agreements, why do they matter, and how do they apply to text message marketing? Keep reading to find out.
Arbitration Agreements for SMS Marketing
An arbitration agreement is an agreement between you and someone that you’re interacting with. Or, in the case of text message marketing, between a brand and a consumer. An arbitration agreement is an agreement stating that any dispute between the parties involved will NOT be resolved in court, but instead managed before a third party like the AAA or JAMS, organizations that facilitate arbitrations.
Brands are allowed to get consumers to waive their right to relief via a class-action lawsuit in favor of an arbitration agreement instead. SMS marketing class-action lawsuits are a common tactic for TCPA plaintiffs, because if a plaintiff can leverage a lot of other people against a brand and their SMS marketing campaign, then the plaintiffs can demand a lot of money in damages.
Benefits of Arbitration for SMS Marketing
Put simply, an arbitration agreement can prevent a TCPA violation from reaching into the millions. These lawsuits are most easily resolved when brands simply send the initial consent request, alongside the terms and conditions, to the consumer requesting the records. This lets the brand and the consumer settle their dispute on an individual basis, which is much more manageable and affordable than a class-action lawsuit.
How else does going to arbitration help? The public does not pay for arbitration, and therefore arbitration isn’t as exposed to the public. This is good for brand reputation for obvious reasons, but there’s another benefit to a non-public option: private arbitration groups require both sides to contribute to the arbitrator’s funds, which can be an additional disincentive for the plaintiff. Just make sure that your arbitration clause is explicitly and specifically designed for your industry and campaign.
SMS Marketing TCPA Compliance
It’s for these reasons that we always encourage clients to work with an SMS provider who understands and follows TCPA regulations. The laws around TCPA compliance are ruled on differently in each individual court and location. Having a team of trusted experts to guide you through the process and help you avoid the pitfalls will save you money (and headaches) in the long run.
We hope this was helpful to you! To learn more about text message marketing and the TCPA, check out our free TCPA Text Messaging Survival Guide.