State and federal telemarketing laws govern the use of SMS marketing and require companies to honor opt-out requests. For businesses who violate them, the TCPA includes damages of $500 per message and some state laws include even higher statutory damages.
To mitigate the risk of class action litigation, many ecommerce companies include mandatory arbitration provisions and class action waivers in the Terms of Service governing their SMS marketing programs. For the arbitration provisions and class action waivers to be effective the SMS opt-in point (popup, checkout page, or form) must create an enforceable agreement between the business and the consumer.
This article provides guidance on designing popups and other collection points with compliance language and hyperlinks that create a binding agreement with consumers to help protect your brand from class action lawsuits. It is based on the legal precedent established in a 2025 decision titled Johnson v. Human Power of N Company, which relates to SMS marketing.
Background of Human Power of N Company Lawsuit
According to the class action complaint filed by Luke Johnson, Human Power of N, utilizing the Attentive mobile platform, continued to send marketing text messages to his mobile phone even after he had responded STOP and after Attentive had confirmed that he would be removed from the SMS list.
After Johnson filed suit seeking to represent a nationwide class and demanding triple damages of $1,500 per message for what he deemed to be a willful violation of the TCPA, Human Power of N moved to compel arbitration asserting that Johnson was bound by an agreement to arbitrate when he opted in through a pop-up created through the Attentive platform.
In Johnson, the court denied a motion to compel arbitration, ruling that the plaintiff did not agree to mandatory arbitration or class action waivers when he signed up for text messages.
As a result, Human N must continue to litigate the case in federal court as a putative class action.
How You Can Design SMS Opt-In Popups That Result in Binding Terms of Service
Based on Johnson v. Human Power of N Company, below are best practices for designing SMS Opt-In popups to increase the likelihood that a court will find them to create binding terms of service with the ability to enforce arbitration agreements and class action waivers.
1. Prominent Placement and Clear Prompts
Spatial Proximity
The disclosure language, including hyperlink to the terms of service, should be placed adjacent to the button or action signifying the user’s consent so that the user is able to see the disclosure language and link to the terms of service prior to taking the action that signifies their agreement.
Clear Prompts That Signify Agreement
Use a clear prompt that explicitly instructs the user what action they will take (e.g., provide their phone number and click a button) to signify agreement to the terms of service. Simply telling someone to “View” the term of service is not sufficient to create an agreement. According to the court, the problem with Attentive’s popups is that nothing “indicates that by clicking the button a consumer is agreeing to abide by the terms.” Therefore, make this clear so that a consumer knows that their actions will bind them to the Terms of Service.
2. Conspicuous Notice and Design
In Human Power of N, the court found the fact that the terms of service “hyperlink was only underscored and not marked in bold, all capital letters, or a different font color . . . [made it] insufficient” to form a binding agreement. As a result, we recommend taking the following steps:
Font Size
It is recommended that disclosure language be no less than 10 px. The goal is that all compliance disclosures should be at a font size that is easily readable to a “reasonable online shopper” on the device in which they are providing consent.
Color Contrast
All SMS disclosure language on your popups or opt-in collection forms should be easy to read. Web accessibility guides suggest disclosure text be a contrast ratio of at least 4.5:1 as compared to the background.
Hyperlinks
Hyperlinks to the terms of service that are contained in the disclosure language should be CAPITALIZED, underlined, bolded, and in a color that contrasts with both the background and the surrounding disclosure language. While blue is a commonly-used color for hyperlinks, the courts have not mandated the use of a particular color. Instead, they have made it clear that hyperlinks should not be in the same color font as the other disclosure language. A contrast ratio of 3:1 between links and surrounding text is recommended.
How We’re Solving for SMS Opt-In Popups That Result in Binding Terms of Service
Postscript’s popups were designed in such a way that they would meet the requirements that resulted in the Human Power of N’s popups on Attentive being found defective:
- Postscript popups include a clear prompt that explicitly instructs the user that providing their phone number and clicking the button will result in an agreement to the Terms of Service. It also informs users that the Terms of Service include an arbitration provision.
- Postscript popups have disclosure language that is positioned adjacent to the location where consumers input their number and click the button to provide their consent.
- Terms of Service hyperlinks are in CAPITAL letters, underlined, and bold font in order to draw attention to them. In addition, templates include hyperlinks in contrasting font colors to help Postscript customers understand the importance of not having hyperlinks in the same color as surrounding disclosure language.
- Postscript popups have a default font size of 10px for disclosure language and will not permit the use of font size below 9px.
Example Popups with Language Compliant with Human Power of N Decision
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