📡 The Big Story
The Seventh Circuit Just Blew Up TCPA Text Litigation (Kind Of)
On July 14, the Seventh Circuit dropped a bomb in Steidinger v. Blackstone Medical Services: text messages are NOT "telephone calls" under Section 227(c)(5) of the TCPA's Do-Not-Call provision. Read that again. The federal appellate court just said the private right of action for DNC violations, the one that fuels roughly a zillion class actions a year, doesn't apply to texts. The full ruling is here and yes, it's as spicy as it sounds.
Here's why this matters: for years, plaintiff's attorneys have used Section 227(c)(5) as the primary weapon against SMS marketers who allegedly messaged consumers on the National DNC list. $500 to $1,500 per text, multiplied by a class, adds up to real money. If the Seventh Circuit's reading holds, that entire theory of liability disappears in Illinois, Indiana, and Wisconsin overnight.
BUT (and this is a big but), the Eastern District of Pennsylvania ruled the exact opposite on June 17, holding that texts ARE telephone calls under DNC provisions. Fox Rothschild has the breakdown. So now we have a circuit split, conflicting district rulings, and an inevitable trip to SCOTUS. Until then? Your TCPA exposure literally depends on which zip code the plaintiff files in. Compliance teams, welcome to hell.
🔥 What's Moving
FCC Wants to Kill the Burner Phone 👀
The FCC is floating a proposal requiring KYC/identity verification for VoIP and prepaid numbers, per Fortune's reporting. On paper: crack down on fraudsters and burner-fueled scam campaigns. In practice: a massive rewrite of how numbers get provisioned, verified, and attached to sender identity in A2P workflows.
Look, I'm all for cleaning up the ecosystem. Scam texts are eating consumer trust for lunch. But mandatory KYC on every VoIP line is going to be painful for legitimate businesses spinning up short-code alternatives, TFN pools, and anything AI-agent-adjacent. Expect a lot of "clarifying" comments during the notice period.
Vibes Launches Self-Serve RCS With a Credit Card 🔥
Vibes just launched RCS Studio Self-Serve, which they're calling the first no-contract, credit-card RCS onboarding. This is actually a big deal. Until now, RCS has been an enterprise-only party with legal reviews, MSAs, and six-month onboarding cycles. Now an SMB can swipe a card and start sending branded, verified rich messages.
If you want RCS to be more than a Fortune 500 toy, this is exactly what needs to happen. Kudos to Vibes for actually shipping it instead of just talking about it at conferences.
RCS Beats SMS by 58% in Retail Testing 📊
Per Retail TouchPoints, early RCS campaigns are driving 58% higher click-through rates than SMS. That's not "modest lift." That's "reallocate the budget on Monday" territory. Branded sender, verified checkmark, rich cards. Turns out consumers click more when they trust the message. Groundbreaking, I know.
Kelley Drye TCPA Tracker Drops Special Update 😴
The July special update covers how petitioners are navigating the FCC's extended revoke-all deadline. Important if you're in compliance. Zzz-inducing if you're not. But hey, read it anyway. Fines don't care if you found the reading boring.
🏆 Winner of the Week: SMS marketers in the Seventh Circuit, who just got a temporary get-out-of-DNC-litigation-free card.
📉 Loser of the Week: The plaintiff's bar, which just watched a favorite fishing pond drain in Illinois, Indiana, and Wisconsin.
📊 By the Numbers
- 58% higher CTR for RCS vs SMS in retail testing. If your CFO still thinks RCS is "nice to have," print that number and slide it across the table.
- $500 to $1,500 per violating text under TCPA Section 227(c)(5). Now imagine that math applied to a 500,000-recipient campaign and you understand why the Seventh Circuit ruling matters.
- 3 states (Illinois, Indiana, Wisconsin) where DNC text claims just got a lot harder to bring. Meanwhile Pennsylvania is going the other direction. Fun times for national campaigns.
🔮 What We're Watching
The inevitable SCOTUS petition. With a clean circuit split on whether texts are calls, someone is filing cert before Labor Day. Whichever way SCOTUS goes, it reshapes TCPA text litigation for a decade. Every messaging platform legal team is drafting scenario plans right now.
FCC KYC comment period. When the burner phone NPRM drops formally, the comment period is going to be a battle royale between consumer groups, carriers, VoIP providers, and CPaaS platforms. The final rule will determine how much friction gets added to every new number in America.
💡 The Hot Take
Here's my controversial take: the Seventh Circuit ruling is actually bad for the messaging industry, even though it looks like a win.
Yes, it reduces litigation exposure. Yes, plaintiff's attorneys are having a bad week. But the reason TCPA has teeth is the same reason consumers still trust SMS enough to give it a 98% open rate. If DNC enforcement on texts effectively collapses in half the country, guess what happens? More bad actors flood the channel, consumers get more junk, carriers respond with more aggressive filtering, and legitimate senders pay the price in deliverability.
The best thing that could happen for the long-term health of A2P messaging is SCOTUS siding with Pennsylvania. Strong DNC enforcement on texts is a feature, not a bug. It's the fence that keeps our channel from turning into email circa 2005. Cheer for the ruling that lowers your legal bills this quarter if you want, but be careful what you wish for. A messaging channel without consequences is a messaging channel without trust, and a messaging channel without trust is worthless no matter how clever your RCS card looks.
See you next week.
— David
