Block, Inc., the operator of Cash App, has reached a proposed settlement of $12.5 million with customers over allegations related to unsolicited text messages sent as part of a referral campaign. This initiative allowed users to invite their contacts to join Cash App by using an “Invite Friends” button, which led to pre-composed messages being dispatched along with unique referral links.
The lawsuit, filed under Washington’s Consumer Electronic Mail Act (CEMA), claimed that recipients received these unsolicited messages, identifying Block’s role in promoting the dissemination of such texts. The plaintiffs argued that while Cash App users opted to send these invitations, Block played a significant role by incentivizing the referrals and providing crafted messaging that created personalized user links. A declaration from one of the plaintiffs indicated that around 1.975 million unique phone numbers in Washington received these referral texts.
In addressing the case, Block sought to apply the Telephone Consumer Protection Act (TCPA) to argue that its involvement in sending the messages was not substantial. However, the court ruled that TCPA was not relevant, as CEMA holds entities accountable for assisting in text message transmissions, making it a more applicable framework for this situation.
Under the terms of the settlement, affected users will receive between $88 and $147 each. This case underlines the potential implications of CEMA, demonstrating that even with minimal involvement, businesses can face significant legal risks when facilitating unsolicited communications.
This proposed settlement serves as a reminder for tech companies to ensure compliance with customer communication laws to protect themselves from similar legal challenges in the future. Hopefully, this case leads to clearer guidelines on marketing practices and customer communications, fostering more respectful interactions between businesses and consumers.