We periodically publish guest posts from Internet Law Attorney and Regulatory Investigation Lawyer Richard B. Newman on topics that affect our readers.
This post contains details on two recent Internet Law topics:
- Class Action Lawsuit Against Mobile Apps Stealing Data
- Jiffy Lube held liable for their marketing firm’s use of text messages.
Read on for news coverage about the mobile apps class action and Richard’s analysis of the Jiffy Lube text message marketing ruling.
MOBILE APPS CLASS ACTION LAWSUIT
The Austin American Statesman reports:
Popular Mobile Apps allegedly “routinely steal address book data such as names, phone numbers, email addresses, job titles and even birthdays from millions of users without their knowledge or consent”.
Mobile Apps News had this additional detail:
A list of 13 plaintiffs, acting “on behalf of themselves and all others similarly situated,” have filed a suit against a series of high-profile companies that make some of the most popular mobile apps around today. The list names 18 companies in all: Path, Twitter, Apple, Facebook, Beluga, Yelp!, Burbn, Instagram, Foursquare, Gowalla, Foodspotting, Hipster, LinkedIn, Rovio, ZeptoLab, Chillingo, Electronic Arts and Kik Interactive. Coincidentally, the suit was filed on Monday, the same day that Yahoo filed a patent infringement suit against Facebook.
And it looks like the lawyers representing the plaintiffs — the Austin firms of Edwards Law, Carl F. Schwenker, and the Jordan Law Firm — appear to have filed this week in an attempt at maximum effect: the suit was made public right in the middle of the SXSW interactive event that brings upwards of 20,000 tech types to the city, including those from the companies named in the suit, and of course exactly the kind of people who use these apps regularly.
Mobile Internet Law
- Mobile Marketer: Do mobile phone users have a constitutional privacy interest in call-location data?
Businesses Liable for Text Messaging by their Marketing Firms
Vicarious Liability Rules Require Companies to Scrutinize
the Consumer Communication Methods of Marketing Partners
The U.S. District Court for the Southern District of California, in the matter of Jiffy Lube International, Inc., has held that a company that engaged a third-party marketing firm to promote its services can be held vicariously liable for violations of the Telephone Consumer Protection Act (“TCPA”) resulting from the marketing firm’s unlawful use of automated text messages – even if the client company did not physically send the messages at issue.
The TCPA prohibits the use of an “automated telephone dialing system” to make non-consensual calls to cell phones. The class action was initiated by six named plaintiffs who claimed that defendants violated the TCPA by sending unauthorized, automated commercial text messages. Text messages to cell phones are considered “calls” for purposes of the TCPA, and unsolicited commercial texts can be a violation of that law, the U.S. Court of Appeals for the Ninth Circuit held in Satterfield v. Simon & Schuster, Inc.
Heartland Automotive Services, Inc., a multi-unit franchisee of Jiffy Lube and a defendant in the case, moved to dismiss on the grounds that it had engaged another of the defendants, Textmarks, Inc., to send the messages. Defendant Heartland argued that because it did not send the messages itself, it could not be held liable under the TCPA. The district court rejected the argument, holding that “case law and a reasonable reading of the statute indicate that Heartland should not be allowed to avoid TCPA liability merely because it hired a different firm to send advertisements to its customers.”
The court explained that the same result was reached, at least implicitly, in Satterfield, where the Ninth Circuit did not question the fact that Simon & Schuster might incur TCPA liability even though they had hired a marketing company to send contested text messages during a book promotion. The district court noted that the Ninth Circuit described the messages as being “from” Simon & Schuster and then cited the decision in Account Outsorcing, LLC v. Verizon Wireless, where a federal district court in Louisiana faced a similar provision regulating facsimile transmissions and held that “congressional tort actions implicitly include the doctrine of vicarious liability.”
The defendants also argued that several named plaintiffs failed to plead the use of an auto-dialer. The court disagreed. One plaintiff pleaded a “specific short code” for one of the messages, and the other named plaintiffs pleaded receiving “substantially identical” text messages. The court held that this was sufficient and ultimately rejected the complaint on a technicality.
Interestingly, the court rejected the defendants’ attempt to submit some of the plaintiffs’ customer invoices into evidence at the motion stage. The defendants claimed that several of the named plaintiffs gave their phone numbers on the invoices when they got an oil change, and by doing that they effectively consented to the text messages. The district court disagreed, in part, because it was not clear whether submitting phone numbers in this manner would equate to consent in any event.
Lastly, the defendants moved to compel arbitration of the dispute with one of the plaintiffs based on an arbitration clause in the invoice he signed when he visited a Jiffy Lube. The court said the clause, which addresses “any and all disputes” between the parties, was “incredibly broad,” by not being limited to contract disputes. The court decided that the clause would be unconscionable if it was read to include tort actions such as this one.
Richard B. Newman is an Internet Law Attorney and Regulatory Investigation Lawyer at Hinch Newman LLP (New York & California)
Gail Gardner
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I learned so much from above discussion. This is great post,very informative. thanks!
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Internet Laws are one of the most critical thing online, which our company usually ignore, perhaps even we don’t realize that laws are actually created us for our benefit.
Glad to hear that some type of law is there as I believe stealing personal information this way is a big crime and they should be penalized.
I was just thinking how its only a matter of time before something like that happened and here we are. I’m excited to see how this turns out since it will set a precedent for alot of information sharing issues in the future.
It may not be fair but companies are responsible for who they hire. If an employee puts the company is risk of being sued then you have to watch your hiring.
Internet Laws are the most important thing online, which we usually ignore, even we don’t realize that laws are made for us for our convenience. Anyways Excellent Research Work.
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Hi Sonia,
We need to start realizing that laws are usually NOT good for us because they are used to control us and keep us from being financially successful while doing nothing to rein in the corruption of multi-national corporations who use them to prevent competition.
By making examples of the few, they use laws to intimidate the rest. We can stop that by LOUDLY protesting EVERY SINGLE TIME they go after one of us. When possible, we must educate those who believe the media tells the real story and that anyone arrested must be guilty.
There is a reason for every word in The U.S. Constitution. They were put there to try to prevent what has happened here. We must restore the belief that all are innocent until proven guilty and take power away from those who have corrupted our systems.
I highly recommend watching this video on How to Regain Personal Freedeom from Freedom Force International.
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i must say Text advertising through mobile phones is maybe the most annoying thing (related to mobile phones). It’s illegal, unethical and annoying, I can’t stand it!
Thats a very nice post. It is the age of smartphones and advertising through smartphones and moblie phones is common now.
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Advertising through the internet is really taking a new shape and a new law to monitor this is necessary.
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The consumer who is aggrieved should contact the company and explain what happened, if the problem occurs again he needs to sue the companies. great article
Ouch! People really need to do their homework before hiring marketers. Especially in the era of internet marketers, where you may not necessarily speak face-to-face with the person who is undertaking their online marketing, so extra care is needed.
Those marketers that you hire should be experienced enough to avoid this kind of things.
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Hi there,
These lawsuits always give me that feeling of dread. I am always afraid that somehow they will inadvertently open a door for ‘big brother’ into a smidgen of control of the internet. And, I really wonder about all these class action suits too. Why can’t one party fight with another without pulling in all these other people?? And, it is always a huge company that they are taking aim at.
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Hi Ann,
Using lawsuits is trying to win in a system that favors corporations because of the influence their money has bought. The reason for class action lawsuits is the enormous cost of fighting against those who have so much money they can win by simply stalling to drive your legal costs through the roof.
Few individuals could ever afford to take on a huge company or have the staying power to see the process through – which takes years and sometimes decades. That is why going after corporations is usually done through a class action suit.
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Thanks for this! I never knew that there is such thing as mobile Internet law. Is this only applied over the United States?
It does show how important it is to know who you are dealing with when hiring people on your behalf.
However it would be interesting to see exaclt how this will pan out, if the hirer’s of the marketeers can be held fully responsible for their actions.
Gaz
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Indeed, the advertising through mobile phones is really annoying me also. One credit card company once called me that if I will apply to them, they will give me a free one-way flight. And I asked how did they get my number because I haven’t remembered I have gotten involved with them, the caller said that she got it from the airlines where I frequently fly with. What the?
Yes, same here. It has become a real bother for me too. Sometimes, it makes me want to disable my phone service as some of the things these companies do flout privacy laws so blatantly over and over again.
-Jean
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Nice post. Advertising through mobiles is common now. and this is very annoying activity. The law of the mobile Internet will be very helpful.
Informative article! This does not come as too much of a surprise to me though… the whole reason facebook is so valuable is it hold so much data about consumers. I also saw another article about possible lawsuits against Pinterest users? Interesting how so many of the sites we use daily are infringing on the law. Thanks for sharing!
I must admit that i was shocked when i first caught ear of mobile apps acquiring your personal details. It’s about time something was done about this, things have gone far enough.
It maybe slightly irrelevant but have you noticed that Facebook has fairly recently alerted you when an app. needs to access your information in order to use it?
Hey Gail, I checked out that Yelp post too, man this is incredible. Maybe I’m just naive, but stuff like this just never occurred to me. Maybe I should be encouraging my kids to pursue a law career specializing in internet and privacy issues!
Hi Stephen,
Few realize how corrupt everything is. Those who have the gold make the rules – and now they control the courts, too. A career in the law would be truly frustrating – at least to me – because it is almost never about what is right or ethical. It is primarily a big power game and whoever has the most power wins.
Even in jury trials, attorneys on both sides of a suit go out of their way to get the least intelligent, most easily manipulated jury they can. People like me are almost always immediately dismissed as unsuitable because we actually know something about ANYthing.
Twice I’ve been called. Once I was dismissed because I knew what the word ballistics meant. The second time I was dismissed because I happened to trail ride with a fellow Quarter horse breeder who happened to be a Police Sargeant on the local P.D.
It appears the assumption was that I would be pro-law enforcement simply because I happened to know and like ONE person in law enforcement. How ridiculous is that? I’d sooner take my chances with the “bad guys” than cross the path of law enforcement.
A thug can take your possessions or your life – but “the man” – the authorities – can make your life a living hell. They can lock you in a cage where they routinely let people go hungry, get hypothermia, and get sick or even die from illness or injury caused by or even inflicted by “the force”.
For just the latest example of that read 65-year-old California Milk Man arrested: subjected to extreme torture, hypothermia, raw sewage in LA County jail.
Read the comments and you’ll see two things:
1) Those are common tactics used against people in American jails.
2) Some believe he is guilty because he was arrested, or because the major media isn’t covering it, or because this story characterizes this treatment as torture.
Most people far too easily dismiss the effects of being treated like that. Our prisons are full of innocent people who confessed because being cold, hungry, and exhausted due to sleep deprivation led them to say anything to make it stop.
For any who do NOT believe that jails hold huge numbers of innocent people railroaded there see the examples at The Innocence Project.
When law enforcement wants to solve a case, they pin it on whoever is most convenient. Now with all the tracking and recording of everything you do, the odds that will be you or someone you know grow every single day.
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Yeah, this thing really isn’t surprising at all. By the time you input your informations on social media, don’t be shocked if your receive messages you don’t expect. This modern technology deprives you of your privacy. Hope this law will at least minimize the said “stealing” of informations of mobile users.
Frankly speaking Richard whole post just bounce from my head as i am not that law know person but i am going to give it to one of my friend who is lawyer and try to understand how text advertising work in india lawsuit
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Text advertising through mobile phones is maybe the most annoying thing (related to mobile phones). It’s illegal, unethical and annoying, I can’t stand it!
At last, hope this law comes to us really quickly, one firm here uses the “automated telephone dialing system” to make non-consensual calls to cell phones regularly, its really annoying and very frustrating!!!
I get that a lot! and its so annoying 🙁
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Gail, looks like this is opening up a whole can of worms!
Shouldn’t be surprised though. Mobile is sort of the last frontier, the wild west, when it comes to privacy issues. I expect we’ll see more of this in the future. Nice if you can keep us posted…
Hi Stephen,
I don’t hold out much hope that decisions governments, regulatory agencies, or even courts make will be decided in favor of what is best for everyone and especially what is best for small businesses and consumers.
Even when laws exist, some consistently get away with breaking them – see Richard’s previous guest post about Yelp – and some get persecuted because of them.
Communications Decency Act Publisher Immunity Not Motive-Based: Yelp Wins Extortion Case
Richard drops me an email whenever he has something to share with my readers – and I turn what he provides into posts like these. We are fortunate to have a specialist in Internet Law to give us some insights in what might impact us.
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Plus class-action laws have been consistently weakened since at least the early 2000’s (when the Republicans allowed some to be tried in federal court as opposed to state courts, which are usually more favorable to plaintiffs in class actions) under the guise of curtailing frivolous lawsuits, even though people suing McDonald’s because they’re fat isn’t a real problem. I’m surprised there hasn’t been any new anti-class action legislation because that guy is suing Apple because he says it falsely advertised Siri.
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