A federal court has declined to let an insurance administrator use the "established business relationship" defense for texts sent to a car dealer's customer. The ruling is early and narrow, but it points at a common assumption: that an existing customer relationship, somewhere in the chain, protects a company when it texts. For senders that text on behalf of partners, that assumption deserves a hard look.
This post explains what the court did, what the established business relationship (EBR) actually is under the FCC's rules, and what high-volume senders should check in their own consent and sender records.
Key takeaways
- In Miller v. S. Brown & Associates (C.D. Cal.), a judge denied a motion to dismiss on Sept. 22, 2026, finding it plausible that an insurance administrator itself sent the texts at issue, and rejecting its EBR argument at that stage.
- This was a pleading-stage ruling by one district court. It accepted the plaintiff's allegations as true and decided no facts.
- An EBR depends on the consumer's own transaction or inquiry with the specific entity doing the texting. Receiving customer data from a partner does not create one, according to commentary on the case.
- In the FCC's rules, the EBR works as a carve-out in the do-not-call framework. It is not listed as a basis for sending autodialed marketing texts to wireless numbers.
- Courts disagree on whether texts count as "calls" under the do-not-call private right of action, so outcomes can depend on where a case is filed.
What the court decided in Miller
The facts below come from TCPAWorld's analysis of the ruling (opens in a new tab), which is reported coverage rather than the opinion itself. They reflect the plaintiff's allegations, not proven facts.
The defendant, S. Brown & Associates (SBA), is an insurance administrator that runs a point-of-sale auto insurance program for car dealerships. Through that program it receives a customer's name, phone number, vehicle, coverage terms, and the date the temporary binder expires.
The plaintiff alleged she never applied to SBA, never asked it for a quote, and never gave it her number. Her number had been on the National Do Not Call Registry since April 15, 2025. Between Nov. 20 and Nov. 28, 2025, she allegedly received multiple texts saying her temporary auto coverage would end on Dec. 19, 2025. The texts advertised a competing insurer's product and included a quote link.
According to the coverage, the court found direct liability plausible for two reasons:
- The texts contained details that, per the complaint, only SBA and the originating dealership would know: the customer's identity, vehicle, temporary coverage, and expiration date.
- Counsel for the advertised brand had allegedly identified SBA as the sender.
Because direct liability was adequately pleaded, the court did not reach the vicarious-liability arguments.
The court also rejected SBA's EBR argument. SBA argued that the customer's purchase "ran through" its infrastructure. As reported, the court looked for a voluntary two-way communication based on the plaintiff's own purchase or transaction with SBA. She had transacted with the dealership, not SBA. The court cited Abboud v. Circle K Stores for the point that a defendant's dealings with a third party do not create an EBR with the plaintiff.
What the ruling does not mean
It would be easy to read the headlines as "insurance administrator found liable." That is not what happened. The court only held that the plaintiff's allegations were plausible enough to proceed. Per the coverage, the putative class action moves forward, and the court also let claims for injunctive relief and treble damages continue at this stage. Whether the case survives past the pleading stage, settles, or is appealed is not yet known.
The earlier history of the case is also instructive. An earlier defendant, the advertised brand Direct General, was dismissed on June 8, 2026, because direct liability was not pleaded and the vicarious-liability theories were conclusory. The plaintiff then amended the complaint and named SBA instead. Claims against a company that sends texts on behalf of someone else can fail when the allegations are thin, and can succeed when the plaintiff can point to specific details showing who actually sent the message.
What "established business relationship" means under the TCPA
The Telephone Consumer Protection Act (TCPA) is the federal law governing calls and texts to consumers. Its implementing rules, at 47 CFR 64.1200 (opens in a new tab), define an EBR narrowly. For telephone solicitations, it is a prior or existing relationship formed by a voluntary two-way communication between a person or entity and a residential subscriber. It must rest on one of the following:
- the subscriber's purchase or transaction with the entity within the prior 18 months, or
- the subscriber's inquiry or application with the entity within the prior 3 months,
and the relationship must not have been terminated.
Two details in the rule matter for partner-based programs:
- A do-not-call request ends it. A seller-specific do-not-call request terminates the EBR, even if the customer keeps buying.
- It does not automatically reach affiliates. An EBR with one business does not extend to its affiliates unless the subscriber would reasonably expect them to be included, given the type of goods or services and the affiliate's identity.
Where the EBR sits in the rules
The EBR is not a general permission slip for texting. In the rule's structure, it enters through the definition of "telephone solicitation," which excludes a call or message to a person with whom the caller has an EBR. The national do-not-call prohibition applies to telephone solicitations, and its text also covers entities on whose behalf solicitations are made.
Separately, the rule on autodialed or prerecorded marketing calls to wireless numbers names prior express written consent as the exception. In the rule text reviewed for this post, EBR does not appear in that provision. In plain terms, an EBR may matter to do-not-call questions, but it should not be treated as a substitute for written consent when texting wireless numbers with marketing messages. How these pieces apply to a specific program is a question for counsel.
What this means for high-volume SMS senders
The practical lesson from Miller is about who the sender is. If your company receives customer data from a dealer, lender partner, lead source, or other business, and then texts those people, a plaintiff may allege that you are the sender, regardless of whose customer the person originally was.
The commentary on the case makes the same point, and it is worth being clear that this is the commentator's view, not the court's holding. Handling a customer's data for a partner does not keep a company out of a direct-liability claim, and receiving data from a partner does not by itself create an EBR. The advice is to confirm your own consent or relationship before running campaigns off partner data.
This affects several common setups:
- Lenders and servicers that text borrowers whose information came through a broker, dealer, or marketplace.
- Lead-follow-up teams that text leads captured by a partner's form or a third party's site.
- Administrators and platforms that process a partner's customer data and send reminders or offers using it.
- Programs with a co-branded or third-party offer, where the message advertises a company other than the one the customer originally dealt with.
The Miller texts mixed a reminder about the customer's own coverage with an advertisement for another company's product. A message that looks like service information but carries a promotion can be treated very differently from a pure service message.
The circuit split adds uncertainty
Courts also disagree on whether text messages are "calls" under the do-not-call private right of action, Section 227(c)(5). On July 14, 2026, the Seventh Circuit held in Steidinger v. Blackstone Medical Services that text messages are not covered by that provision (opens in a new tab) and affirmed dismissal of a putative class action over marketing texts.
The Miller court went the other way. As reported, it held that texts are calls under Section 227(c) and declined to follow Steidinger, because a district court in the Ninth Circuit is bound by the Ninth Circuit's decision in Howard v. RNC. Coverage describes the split as real, and which rule applies depends on where a case is filed. For a sender texting nationally, that means you generally cannot count on the more favorable circuit's rule.
What to do now
None of these steps is a legal interpretation. They are general operational practices that reduce risk when you text on behalf of partners or from partner data.
- Map every program by sender. For each campaign, write down which entity the recipient would see as the sender, which entity's data you are using, and which entity's brand or offer is in the message.
- Trace consent to your own records. For each recipient list, confirm what consent or relationship exists with the entity actually sending, not only with the partner that supplied the data.
- Don't assume partner data carries consent. If a list came from a dealer or lead source, check what disclosures the consumer saw and whether they covered your company and your type of messages.
- Review message content. Identify any texts that combine a service reminder with a promotion or a third party's offer, and review them with counsel.
- Check suppression handling. Confirm that do-not-call requests and opt-outs are honored promptly, across partners and across campaigns that share a list.
- Screen against the National Do Not Call Registry where your program calls for it, and keep records of when and how you did so.
- Keep records. Retain consent records, list sources, and message logs in a form you can produce quickly if a claim arrives.
- Revisit partner contracts. Make sure agreements with dealers, lead sources, and co-marketers spell out who obtains consent, who sends, and who handles opt-outs.
Where Flowtext fits
Flowtext is built for teams that send at volume and need compliance handled in the workflow. It handles automatic STOP/opt-out processing, list scrubbing for duplicates, landlines, and blacklists, and quiet hours by recipient timezone, and it is 10DLC registered and TCPA compliant. Those controls cover mechanics, though they do not replace getting the right consent from the right entity in the first place. You can read more on the Flowtext compliance page, or see how teams run lead follow-up and lending programs where texts go out on behalf of multiple parties.
Frequently asked questions
Does an established business relationship allow me to text customers without consent?
Not as a general rule. Under the FCC's rules, the EBR is part of the do-not-call framework: it carves certain calls and messages out of the definition of "telephone solicitation." The rule governing autodialed or prerecorded marketing calls to wireless numbers names prior express written consent as its exception and does not mention EBR. Whether and how an EBR applies to a particular marketing text is a question for counsel.
Can I text a partner's customers if my partner has their consent?
The Miller ruling suggests caution. The court, at the pleading stage, rejected the argument that data and a transaction passing through the defendant's systems created an EBR with the consumer. As commentary on the case puts it, receiving customer data from a partner does not by itself create an EBR, and companies should confirm their own consent or relationship before texting. Whether a partner's consent extends to you depends on what the consumer actually agreed to.
Who is the "sender" under the TCPA when I text on behalf of another company?
There is no single test in the research behind this post, and the answer depends on the facts. In Miller, the court found it plausible that the administrator itself sent the texts, pointing to message details that only the administrator and the dealership would know and to a statement by the advertised brand's counsel identifying it as the sender. Because that was enough, the court did not reach vicarious liability. Companies that send texts using partner data should assume they may be treated as the sender.
This post is general information, not legal advice. Consult counsel about your own texting programs.
Tags
- TCPA
- SMS compliance
- established business relationship
- consent
- third-party texting