Following EIA Advocacy, MI Senate Committee Fails to Advance Mini-TCPA
As we reported last month, the unexpected introduction of a “mini-TCPA” in the Michigan Senate late in the legislative year raised significant concerns for EIA. Michigan Senate Bill 1037 was sponsored by the Chairwoman of the Michigan Senate Committee on Finance, Insurance, and Consumer Protection, which has jurisdiction over the matter, and included bi-partisan co-sponsors.
Michigan SB 1037 Sets Off Alarm Bells
EIA expressed concern that if SB 1037 was adopted, it would create a flood of litigation in Michigan, because it included many of the most troubling provisions we’ve seen in other bills, including the Florida Telemarketing Solicitation Act (FTSA), which had to be amended in 2023 after courts there saw an influx of frivolous litigation.
Some of the most pressing concerns for EIA included:
Overly Broad Definition of "Telephone Communication": Including not only SMS and MMS, but all text and image-based messages including those sent using “mobile applications.” This definition creates uncertainty for businesses using push notifications and other app-based features and is inconsistent with federal telemarketing regulations.
Inconsistent Auto-Dialer Definition: The bill's definition goes beyond the federal TCPA and could encompass platforms that send messages only to consenting customers. This creates unnecessary burdens for legitimate businesses.
Unworkable Requirements for Text Message Marketing: Requirements to provide a first and last name and a voice-capable number are not compatible with how text message marketing actually works, particularly when using shortcodes. These should be replaced with clear rules for receiving opt-out requests via text message.
Excessive Damages and Shakedown Lawsuits: The bill allows for private lawsuits with hefty damages for each message, even if the recipient consented initially. This encourages frivolous lawsuits and hinders innovation, potentially leading to job losses within Michigan businesses.
EIA Engages in Michigan
Based on feedback from those on the ground in Michigan, EIA believed that SB 1037 was poised for passage during the “lame duck” session – those weeks between the November elections and when new members of the Michigan Legislature are sworn in for their terms in January. This fear was particularly acute this year where Democrats lost control of the Michigan House, ending their trifecta of control over state government, where they controlled the House, Senate, and Governorship (as well as the Attorney General’s office).
Against this backdrop, EIA embarked on a campaign to ensure that the bill was not rushed through without adequate consideration for its impact on ecommerce businesses nationwide. EIA engaged with staff for the Committee Chair who had introduced the bill as well as other members of the Senate Committee. EIA also engaged with other business groups in Michigan to encourage them to also pay attention to the bill and surface their concerns.
On Friday, December 13, 2024, the final day for bills to pass their first chamber if they were to be enacted into law before the current legislature leaves office, the Michigan Senate passed 158 bills and the Michigan House passed 116 bills. EIA was pleased to see that the Michigan Senate Committee on Finance, Insurance, and Consumer Protection decided to hold no hearings on SB 1037, declined to vote it out of committee, and never progressed the bill to the full Senate for consideration. The fact that the bill was not rushed through with other lame duck bills, many of which passed without significant debate or industry input, is a big win for EIA and ecommerce companies.
Looking Ahead
EIA anticipated that a similar bill may resurface during the next legislative session, If and when a new bill is introduced, EIA will be well positioned to work with leadership in both Chambers to guard against the unintended consequences that HB 1037 would have created.
