The Ecommerce Innovation Alliance (EIA) is disappointed to announce that the Oregon Legislature has passed House Bill 3865, and we are now urgently calling on Governor Tina Kotek to veto this problematic legislation. While we fully support the goal of protecting Oregonians from unwanted communications, HB 3865, as passed, contains provisions that will have significant, unintended consequences for legitimate small and mid-size businesses, political campaigns, and Oregon citizens alike, and presents a clear violation of First Amendment free speech protections.
Throughout the legislative session, the EIA has been at the forefront of advocating for common-sense reforms to HB 3865. Our President and CEO, David Carter, along with other industry experts like former FCC Commissioner Michael O’Rielly and Postscript’s Chief Product Officer Chiara McPhee, testified before legislative committees, engaged in public hearings, and held follow-up meetings with key legislative offices, including Representative Sosa’s office and the Oregon Department of Justice. We consistently highlighted the critical issues within the bill, offering detailed insights and proposing solutions to prevent the very chaos this legislation now threatens.
The Core Problem: Disregard for Prior Express Consent Undermines Constitutional Protections
Our primary concern remains the bill’s unconstitutional infringement on commercial speech, specifically its refusal to recognize “prior express invitation or permission” as an exception for text messages. HB 3865 expands the definition of “telephone solicitation” to explicitly include text messages for encouraging purchases or donations. However, unlike the federal Telephone Consumer Protection Act (TCPA), it lacks a crucial exclusion for communications where consumers have provided their prior express consent.
Consider the scenario of an Oregon parent doing some online shopping after putting the kids down for bed. She voluntarily signs up for their SMS marketing list to receive a 20% discount. If she does this after 8 p.m. – a common time for online shopping – HB 3865 would prohibit the business from lawfully sending her the requested discount code because she doesn’t yet have an “established business relationship” (defined as a previous transaction within the last 18 months). This means both the consumer, who expects her discount, and the business, which loses a sale and risks negative reviews, lose out.
This flaw becomes even more problematic in conjunction with Oregon’s existing do-not-call (DNC) list statutes, which HB 3865 extends to text messages. Under the bill, businesses would be prohibited from sending solicited messages to any prospective new customer whose number is listed on the national DNC registry, even if those individuals have explicitly requested to receive the communications. This impacts approximately half of all Oregonians.
This provision directly contradicts the very principle that allowed the federal national DNC registry to survive its First Amendment challenge in Mainstream Marketing Services v. FTC. The Tenth Circuit Court of Appeals upheld the federal DNC registry precisely because it is an “opt-in program that puts the choice of whether or not to restrict commercial calls entirely in the hands of consumers,” noting it “restricts only calls that are targeted at unwilling recipients” and “does not inhibit any speech directed at the home of a willing listener”. By refusing to honor a consumer’s explicit choice to receive messages, HB 3865 creates a “blanket restriction” that prevents a “reasonable fit” between the government’s objectives and the means chosen, thus rendering it an unconstitutional infringement on protected commercial speech.
Unconstitutional Impact on Political Speech
HB 3865 also significantly impacts political text messages, raising serious free speech concerns. Oregon’s Legislative Counsel has confirmed that text messages soliciting donations or campaign-related merchandise would be considered “telephone solicitations” and subject to the bill’s restrictions. Because the bill’s definition of an “established business relationship” narrowly focuses on a “previous transaction or series of transactions,” it disregards prior express consent for political campaigns. This means campaigns would be prohibited from texting individuals on the national DNC registry for donations, even if those individuals have explicitly expressed interest or given consent, unless they’ve already donated or purchased merchandise. Legislative Counsel even warned members of the legislature that HB 3865 “does have a potentially unconstitutional effect on the free speech rights of persons who solicit campaign donations or the purchase of campaign-related merchandise.”
A Call for a Veto
The passage of HB 3865 represents a step backward for fostering a thriving e-commerce environment and protecting fundamental rights in Oregon. We commend the intention to protect consumers, but this bill’s disregard for established federal guidelines and consumer consent, and its potential to unleash a wave of litigation create an untenable situation.
The EIA, along with organizations representing over 80,000 small and mid-size businesses, including the Insurance Marketing Coalition, Lending Tree, Podium, Postscript, and Lalo, strongly urges Governor Kotek to veto House Bill 3865. We remain committed to working with Oregon’s leaders to find a more sensible and balanced path forward that effectively targets bad actors without imposing undue and impossible burdens on legitimate e-commerce businesses and political campaigns that seek to communicate with willing supporters.
For more details on EIA’s advocacy regarding HB 3865, please see our previous blog posts:
- EIA Rallies Industry to Advocate for Changes to Oregon HB 3865
- Problems Persist in Oregon: EIA Reacts to Oregon Senate Judiciary Committee Advancement of HB 3865A
- EIA Sounds Alarm as Oregon House Passes HB 3865, Ignoring Business Concerns and Ushering in Regulatory Chaos
- EIA Testifies About Concerns Over Proposed Text Messaging Regulations in Oregon
