As discussed in prior articles, Texas has become one of the nation's most aggressive regulators of telemarketing and unsolicited communications. What began in 2009 as a modest state-level "mini-TCPA" has evolved, particularly following Senate Bill 140's September 1, 2025, effective date, into a comprehensive regulatory and litigation regime that exposes telemarketers to multifaceted enforcement mechanisms and potentially catastrophic financial exposure.
At the heart of this regulatory landscape lies a deceptively simple requirement: obtain a registration certificate before placing calls or sending text messages to Texas residents. Yet beneath this straightforward mandate lies a fundamentally unresolved legal question with enormous practical consequences: when a company fails to register and places multiple calls or messages, does it face a single $5,000 penalty or is each call subject to damages of $5,000 on top of the other damages authorize by SB 140?
Key Texas Law Article Takeaways
- Texas Business and Commerce Code Section 302.101 mandates that any seller making phone solicitations to or from Texas to secure a registration certificate for each business location from which solicitations are made.
- Civil penalties for failing to register allow for up to $5,000 per violation, but the statute does not expressly define whether a failure to register constitutes a single violation or whether each call or transmission made without registration is a separate violation. This ambiguity creates significant uncertainty in calculating potential exposure.
- While there are arguments for both interpretations, both the statutory language and the limited case law on the subject appears to support a per-call analysis, though courts have not definitively resolved the issue for civil penalty purposes.
The Registration Requirement of Section 302.101 in Texas
Section 302.101 of the Texas Business and Commerce Code establishes a mandatory registration regime for any company that places sales calls to Texas numbers. The statute's core provision is unambiguous in its basic requirement: "A seller may not make a telephone solicitation from a location in this state or to a purchaser located in this state unless the seller holds a registration certificate for the business location from which the telephone solicitation is made."
While there several key exemptions, most companies that place sales calls to Texas numbers are subject to the registration requirement of Section 302.101. The statute further specifies that "a separate registration certificate is required for each business location from which a telephone solicitation is made," which means that a company with multiple call centers must register each facility separately, each registration requiring the associated fees and compliance obligations.
It is important to note that the Texas seller registration requirement is nothing new. In fact, it has been in place since 2009, and the law included a $5,000 civil penalty since its inception. However, prior to SB 140, enforcement of Section 302.101 was largely the province of the Texas Attorney General, who could also pursue the authorized penalty. Consumers had limited direct private rights of action, and filing a complaint with the Attorney General's office was often a prerequisite to initiating litigation.
SB 140 made substantial changes but thankfully did not increase the $5,000 registration penalty. Instead, SB 140's transformative impact came through two distinct mechanisms. First, SB 140 expanded the scope of regulated conduct by extending the registration requirement to text messages and other electronic transmissions, bringing digital marketing squarely within the law's ambit.
Second, and more consequentially, SB 140 created a direct private right of action for consumers. Under the amended law, violations of Section 302.101 now automatically constitute violations of the Texas Deceptive Trade Practices Act (DTPA), enabling consumers to sue directly without first exhausting administrative remedies. Through this DTPA avenue, consumers can recover **statutory damages of $500 to $10,000 per violation, and in cases involving knowing or intentional conduct, treble damages and attorney's fees.
Moreover, SB 140 explicitly clarified that "the fact that a claimant has recovered under a private action arising from a violation of this chapter more than once may not limit recovery in a future legal proceeding in any manner." This language eliminates any single-recovery bar and opens the door to serial litigation by individual plaintiffs.
However, SB 140 did not resolve or even address the fundamental ambiguity regarding whether a single failure to register constitutes one violation or whether each call or transmission made without registration is a separate violation. The law simply expanded the mechanisms through which these penalties could be pursued.
The Per-Call Question Under Section 302.251
The crux of the unresolved debate lies in the language of Section 302.251, which addresses criminal penalties for violating the registration requirements in Texas. The statute reads:
"A person commits an offense if the person knowingly violates Section 302.101, 302.105, 302.201, 302.202, or 302.203. Each violation constitutes a separate offense."
Additionally, Section 302.302 of SB 140 provides the civil penalty framework:
"A person who violates this chapter is subject to a civil penalty of not more than $5,000 for each violation.”
The phrase "each violation" appears in both the criminal and civil contexts, but the statute provides no definition of what constitutes "a violation" in the registration context.
The Interpretive Divide
The Per-Call Interpretation: One school of thought argues that each unauthorized call or transmission made without a valid registration certificate constitutes a separate violation under Section 302.251's express statement that "each violation constitutes a separate offense." Under this interpretation, a company that places 100 unregistered calls in Texas faces 100 separate violations and therefore potential exposure to $500,000 in DTPA damages at $5,000 per call.
The logic supporting this interpretation draws strength from the statute's clear language. If the legislature intended to distinguish between a single violation (the failure to register) and multiple violations (each unauthorized transmission), it could have drafted Section 302.251 to state, "the failure to register" rather than "each violation." The use of the term "each" suggests a granular, transaction-level analysis.
The Single-Violation Interpretation: The opposing view contends that the failure to register constitutes a single, continuing violation. Under this analysis, a company that fails to register and places multiple calls has committed a single violation of Section 302.101, even if it makes thousands of calls. The per-call language in Section 302.302 might then be interpreted as permitting up to $5,000 for that single registration violation, with the phrase "for each violation" intended to address violations of different subsections or different types of violations (e.g., separate calls to no-call-listed numbers, separate failures to disclose identity, etc.) rather than multiple instances of the same unregistered-caller violation.
This interpretation could derive support from principles of statutory construction suggesting that the registration requirement is a status-based obligation (either a company is registered or it is not) rather than a conduct-based prohibition that repeats with each call.
Case Law and Practical Application
Surprisingly, given the law's 16-year history, reported appellate decisions directly addressing the per-call question remain sparse. Courts have not issued comprehensive guidance on whether a registration violation should be calculated as a single penalty or per-call penalties.
The most illustrative example in reported case law is the Cacho v. Amity One Debt Relief case, which involved a Section 302.101 violation arising from unregistered telemarketing calls. In that case, a court awarded $75,000 in damages for fifteen violations, calculated at $5,000 per call. While this case does not represent a definitive appellate ruling, it demonstrates how at least one court has applied the statute in practice, effectively treating each unauthorized call as triggering a separate $5,000 exposure.
Additional district court authority supports per-call calculations. In Guadian v. United Tax Defense LLC, a federal magistrate judge found Section 302.101 violations based on eight separate calls and text messages, applying the statute's language to treat each transmission as a distinct violation. While this case involved TCPA claims in addition to the state law claim, the court's treatment of the separate calls as separate violations reflects an interpretive approach consistent with the per-call theory.
The Implications for Defendants
The practical consequences of these competing interpretations are no less than staggering for sellers placing calls to Texas numbers. A company that violates Section 302.101 by failing to register and places 100 calls faces radically different exposure depending on which interpretation prevails:
- Under the single-violation theory: up to $5,000 in civil penalties plus potential private DTPA recovery
- Under the per-call theory: $500,000 in potential civil penalties plus multiples of that in private DTPA recovery (potentially $1.5 million at $15,000 per call if treble damages apply)
Given this exposure, the question is not merely academic; it defines whether Section 302.101 violations represent a manageable compliance risk or a potentially existential threat to telemarketers' viability. In light of the statutory language, the interpretative divide, and the reported case law, prudent sellers should assume the per-call interpretation of the registration requirement will apply. While a court may very well rule otherwise, the alternative can lead to catastrophic exposure.
One thing is certain: SB 140 has empowered individual consumers to litigate these claims directly, creating a litigation environment in which plaintiffs' counsel will naturally press the per-call interpretation to maximize damages.
