Robinhood makes another attempt to nix case about spam messages
Online trading app Robinhood has made another attempt to dismiss a lawsuit about its allegedly spammy refer-a-friend marketing campaign.
As FX News Group has reported, Cooper Moore has taken Robinhood to Court after he received an unsolicited message encouraging him to invest with the company.
Moore explains that, to attract new customers, Robinhood recruits its existing customers to send spam texts through the Robinhood app to people who never consented to receive the texts. The Robinhood app’s functionality enables its users to initiate the referral texts, recommends which contacts should receive the referral texts, composes the texts, provides user-specific links that the recipient can use to sign up for Robinhood’s services, formats the texts, and provides images for the texts.
Cooper Moore, who resides in Washington state, received one of these spam texts from Robinhood without providing his consent to receive the marketing text asking him to join Robinhood.
Plaintiff alleges that Robinhood’s spam texts violate CEMA which specifically prohibits companies like Robinhood from sending spam texts to Washington residents without consent. A violation of the CEMA is a per se violation of Washington’s Consumer Protection Act, Wash. Rev. Code 19.86 et seq. (CPA).
Unlike the TCPA, under the CEMA it makes no difference if Robinhood or its customers “initiated” the text, Moore notes. The CEMA prohibits both initiating and assisting in the transmission of commercial electronic text messages to Washington residents without their consent. “Assisting” is defined broadly to include, among other things, “composing” and “formulating” the messages.
Plaintiff details the exact conduct Robinhood engages in to substantially assist and supports its users in sending text messages marketing Robinhood, including composing and formulating the messages, as well as other conduct that satisfies the statutory definition of “assist.” Because Plaintiff’s allegations establish a “chain of events” through which Robinhood assisted with the transmission of the texts he has stated a claim under the CEMA.
Robinhood has sought to dismiss the case again. On October 7, 2021, the company filed a reply in support of its motion to dismiss.
In the document, Robinhood says that the plaintiff concedes that Robinhood is not the original sender of the refer-a-friend text message that he alleges he received from a contact stored in his personal mobile device’s address book.
Robinhood notes that the app is free to download and that the text message the plaintiff received offered free stock and the option to join Robinhood to engage in commission- free trading—in other words, not the sale of a product or service in exchange for money from the text message recipient to Robinhood.
The company also stresses that the original sender of the text message that the plaintiff alleges he received—and the original senders who sent refer-a-friend text messages to putative class members—are not “conducting business in Washington.”
These concessions, according to Robinhood, are sufficient to dismiss Plaintiff’s claim under the Washington Consumer Protection Act (“CPA”), which is predicated solely on a supposed violation of Washington’s Commercial Electronic Mail Act (“CEMA”). Plaintiff’s concession that Robinhood is not the “original sender” of the refer-a-friend text message precludes him from proceeding on an “initiation” theory. Plaintiff’s concession that the original senders are not “conducting business in Washington” means that they do not violate CEMA or the CPA for sending the exact same text messages that form the basis of Plaintiff’s CEMA claim against Robinhood.
Further, Robinhood argues that this means that the plaintiff cannot proceed on his “assistance” theory; Robinhood cannot be liable under that theory unless it knows or consciously avoids knowing that the original sender is violating the CPA when sending a referral text message.
Moreover, according to Robinhood, the plaintiff cannot proceed on either his “initiation” or his “assistance” theory because the text message that the plaintiff alleges he received does not promote “real property, goods, or services for sale or lease,” taking the text message outside the bounds of a “commercial electronic text message” under CEMA’s plain statutory language. A CEMA violation cannot be premised on a text message offering only free stock and free use of Robinhood’s mobile app to engage in commission-free trading.
According to Robinhood, the plaintiff has failed to carry his burden to show that his allegations are sufficient to state each element of a plausible CEMA claim on which his CPA claim depends. Robinhood requests that the Court grant its motion to dismiss.