Businesses Face Significant Liability Under Updated Texas Law

Expanding upon existing telemarketing statutes, Texas has enacted an updated law that poses serious liability risks for businesses, with expanded definitions, the creation of a private right of action and the potential for treble damages.

The amendments to the state’s Business and Commerce Code in Senate Bill 140 (SB 140)—signed into law by Governor Greg Abbott on June 20—are set to take effect on Sept. 1, 2025. Below are some of the key changes.

• Private right of action. While existing law did allow for a private right of action for violations of Texas’s telemarketing regulations, plaintiffs faced several procedural hurdles before being able to file suit. Specifically, potential plaintiffs were required to file a complaint with the Texas Attorney General, Texas Public Utility Commission or other state agency; if the government entity elected to take action, the consumer could not pursue a claim for damages. However, pursuant to SB 140, consumers now have the ability to file a private right of action under the Deceptive Trade Practices Act (DTPA) without having to satisfy the procedural requirements.
• Possible claims. Potential causes of action include noncompliance with restrictions on the allowable hours to make calls, failure to register with the state and ignoring opt-out requests. In addition, the DTPA permits recovery for the use of an automatic dialing announcing device—the Texas version of robocall and autodialing systems—which has a broader definition than the Telephone Consumer Protection Act’s definition of automatic telephone dialing system.
• Definition changes. Previously, the telemarketing law only applied to voice calls. SB 140, however, expanded the definition of “telephone call” and “telephone solicitation” to include text messages, images, graphic messages or other electronic transitions initiated by a seller to induce a person to purchase, rent, claim or receive an item.
• Repeat plaintiffs. Multiple legal recoveries for the same violation do not limit future recovery, according to SB 140, which provides that “[t]he fact that a claimant has recovered under a private action arising from a violation of this chapter more than once may not limit recovery in a future legal proceeding in any manner.”
• Available damages. Using the private right of action, consumers can seek actual damages or statutory damages of $500, with the potential for treble damages for willful misconduct. In addition, the DTPA allows for recovery of economic damages, mental anguish damages, additional damages for knowing or intentional conduct, injunctive relief, restoration of money or property, and attorney’s fees and court costs.

To read the new Texas law, click .

Why it matters: Businesses face significant potential liability with the changes in Texas law, particularly as the bill stated that the statute should be “liberally construed and applied” to protect consumers against false, misleading or deceptive practices in telephone solicitation and telemarketing. To avoid potential lawsuits, businesses should ensure compliance with the updated law, including registering as a telemarketer with the state, ensuring proper consent mechanisms are in place, honoring opt-out requests as required and checking to make sure all communications feature the appropriate disclosures.