Last week, the Central District of California granted summary judgment in a TCPA case involving a single prerecorded call from the plaintiff’s medical insurance company. In Smith v. Blue Shield of California, the plaintiff alleged that her medical insurance provider violated the TCPA by placing a prerecorded call to her cellphone without her prior express written consent. The court concluded that there had been no violation because the call was informational and did not constitute telemarketing. As a result, the caller was not required to have prior express written consent. Because the question of whether a call is or is not telemarketing is critical to determining whether prior express consent or prior express written consent is required under the TCPA, Smith’s clear analysis of this issue is particularly valuable to companies facing TCPA suits.
Smith involved a single prerecorded call placed by the plaintiff’s medical insurer regarding the automatic renewal of her coverage. As part of her initial application for coverage, the plaintiff had provided her cellphone as her primary contact number, but her application did not include the disclosures required to satisfy the FCC’s prior express written consent requirements. From these facts, the Central District concluded that the plaintiff had provided prior express consent, but not prior express written consent. When the time came to renew her coverage, the plaintiff was one of a number of insureds whose mailed renewal packets had been returned undelivered. Blue Shield of California developed a prerecorded message to be played during calls to those insureds so that they would know that their insurance would be automatically renewed. The prerecorded message, which was prepared by Blue Shield of California’s marketing team, directed the insureds to Blue Shield of California’s website.
The central question in Smith was whether this prerecorded message was marketing or not. Under the FCC’s regulations, prerecorded telemarketing calls require prior express written consent to comply with the TCPA. In Smith, the Central District first analyzed the content of Blue Shield of California’s prerecorded message and concluded it was informational rather than telemarketing. It also examined HIPAA regulations, which permit insurers to contact insureds about renewal or replacement of coverage, and found that Blue Shield of California’s prerecorded message was within the informational purposes set out by those regulations. In response, the plaintiff argued that Blue Shield of California’s reference to its website converted the call into telemarketing. She also argued that the call was telemarketing because the insurer’s overall purpose was to retain customers so that it would continue to receive premiums. The Central District rejected both of these arguments. First, it found that “the mere fact that the parts of Blue Shield’s website contains the capability of allowing consumers to engage in commerce does not transform any message including its homepage into telemarketing or advertising.” Second, it found that the alleged marketing purpose of retaining customers was “simply too attenuated to give rise to clear, unequivocal implication of advertising.”
The Smith court’s analysis of the telemarketing issue is helpful for companies facing TCPA claims because it helps to set a clear line between advertising and informational communications.