The Fourth Circuit Court of Appeals, in a split decision, gave further insight into what “unsolicited advertisement” means under the TCPA.

In 2020, Pulse8, LLC, a healthcare analytics and technology company, sent a fax to Family Health Physical Medicine, LLC inviting them to a free webinar to learn about behavioral health coding and how to successfully document and code mental health disorders. After receiving the fax, Family Health filed a lawsuit alleging that the fax was an unsolicited advertisement in violation of the TCPA. Pulse8 filed a Motion to Dismiss and argued that the fax was not an advertisement as defined by the TCPA because it only offered a free webinar. The U.S. District Court for the District of Maryland agreed with Pulse8 and dismissed the lawsuit. Family Health appealed the ruling to the Fourth Circuit Court of Appeals.

The TCPA defines an “unsolicited advertisement” as “material advertising the commercial availability or quality of any property, goods, or services.” 47 U.S.C. § 227(a)(5).

Family Health offered two theories as to why the fax should be considered an advertisement. The first was that the fax promoted a webinar related to defendant’s for-profit business – selling software containing medical coding technology. In a prior Fourth Circuit case, the Court ruled that a fax need not “propose a specific commercial transaction on its face” to be covered by the TCPA, but only needs to show a commercial component or commercial nexus between the fax and the sender’s business. The second was that Family Health could not accept the offer to attend the webinar without providing its contact information and consenting to receiving further promotional materials. If Family Health provided its contact information, it would “pave the way” to being sent additional marketing materials.

The Fourth Circuit agreed with Family Health and ruled that these two theories plausibly allege that the fax was an advertisement under the TCPA. The Court reversed the dismissal and remanded the case back to the district court for further proceedings.

One of the three judges wrote a dissent in which he disagreed with the ruling and its reliance on a pretext theory of liability. The dissenting judge argued that the Court expanded the meaning of “unsolicited advertisement” as defined by the TCPA, “providing a cause of action to nearly every recipient of a fax from a for-profit entity, regardless of the content of the fax itself.” Under the pretext theory, a fax can be considered an unsolicited advertisement if can be plausibly alleged to a pretext to future advertising. But, as Judge Agee points out, in order to determine whether it is a pretext to future advertising, a court is required to look beyond the fax itself and consider facts outside of the words on the fax.

Fam. Health Physical Med., LLC v. Pulse8, LLC, No. 22-1393, 2024 WL 3076389, at *1 (4th Cir. June 21, 2024)

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