Calls, Texts For Free Services Do Not Fall Under TCPA

TCPA Connect

Calls and messages encouraging a recipient to sign up for free nutrition counseling services did not constitute telephone solicitations within the meaning of the TCPA, according to a reported decision from a Wisconsin federal court.

Foodsmart, a for-profit company that provides nutritional counseling and related services, contracts with health plans and provides services to plan members at no cost to the individuals. One of the health plans Foodsmart contracted with was Chorus Community Health Plans (CCHP).

CCHP and Foodsmart agreed that Foodsmart would provide its services to CCHP members at no cost to them, while CCHP would pay Foodsmart a monthly fee per eligible member on a per-month or per-year basis, depending on if the member was receiving benefits through commercial insurance or Medicaid. The contract also provided for performance bonuses for each member who improved their nutritional habits by a certain percentage or lost a certain percentage of body weight.

James Hulce, who received health insurance through CCHP, received approximately 20 calls and text messages from Foodsmart’s representative, Quality Contact Services (QCS), between 2021 and 2022. The communications generally encouraged Hulce to enroll in the Foodsmart services available to him for free as a CCHP member. For example, one text message read: “October is the month of sweet treats & pumpkin spice everything. Make meeting with a personal dietician part of your Fall routine & balance your blood sugar.”

Hulce filed suit against Foodsmart, alleging violations of the TCPA because his number was registered on the National Do Not Call Registry and he continued to receive calls after asking for them to stop.

Foodsmart moved for summary judgment. The company told the court that QCS’s calls and messages did not violate the TCPA because they were not telephone solicitations. Further, Foodsmart argued that the purpose of the calls and messages were not to sell Hulce anything, but to notify him about a free service available through his health plan, and that they did not ask the recipient of the messages to make any purchases.

Hulce countered that the calls and messages were initiated for the purpose of encouraging the purchase of Foodsmart’s services because CCHP would have paid for the services, had he accepted them.

U.S. District Court Judge Lynn Adelman sided with Foodsmart and granted the motion.

The court determined that the plain language of the TCPA requires a communication’s purpose to be to encourage someone to make a purchase in order to be actionable as a “telephone solicitation.” The calls and texts at issue did not. The court wrote: “Although plaintiff was encouraged to utilize Foodsmart’s services, he was not encouraged to purchase them because, to utilize them, he did not need to pay money or its equivalent,” The court opined further, stating that the “only other potential purchaser was CCHP. While CCHP’s paying Foodsmart to provide services to its members might reasonably be characterized as a ‘purchase’ of those services on behalf of its members, the purpose of the communications could not have been to encourage CCHP to make that purchase. At the time of the communications, CCHP had already agreed to pay Foodsmart for any services provided to its members, so CCHP needed no further encouragement to do so.”

Because the calls and text messages did not encourage the purchase of any good or service, they were not telephone solicitations sent in violation of the TCPA’s DNC regulation, Judge Adelman held, granting the motion for summary judgment.

To read the decision and order in Hulce v. Zipongo, Inc., click here.

Why it matters:

Although the court agreed with the plaintiff that the calls and texts encouraged recipients to utilize the defendant’s services, they could not be read as encouraging a purchase to be made, because the services were already available to individuals through the health plan’s contract with the company. Readers should be mindful that the Court reached this decision at the summary judgment stage, and it is entirely possible that a Court may not reach this decision on a motion to dismiss.



pursuant to New York DR 2-101(f)

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