Robinhood strikes back at claims about spam messages
Online trading company Robinhood has responded to claims that it violated the Washington Consumer Electronic Mail Act (“CEMA”) via its refer-a-friend marketing campaign. This becomes clear from a document submitted by Robinhood at the Washington Western District Court on March 29, 2022.
The plaintiffs in this case are individuals who got sent messages by their friends under a marketing program devised by Robinhood inviting them to trade with Robinhood. According to the plaintiffs, Robinhood Financial LLC invented the scheme to pay and enable its users to spam their contacts with text message advertisements asking those contacts to “join Robinhood.”
Earlier in March, the plaintiffs filed their response to Robinhood’s motion to dismiss at the Washington Western District Court. Now, Robinhood has responded to the allegations.
Robinhood notes that the plaintiffs do not dispute that the Robinhood users who allegedly sent them the text messages at issue had full control over whether, when, and to whom to send the editable text messages from the native text message applications on their personal mobile devices. Plaintiffs do not dispute that the original senders of the text messages at issue were not operating as businesses when sending the texts.
And Plaintiffs do not dispute that the Robinhood app is free to download, that the text messages they received offered only free stock and an invitation to “join Robinhood,” and that the Robinhood app offers commission-free trading.
The compay says that these concessions alone are fatal to Plaintiffs’ claims under Washington’s Commercial Electronic Mail Act (“CEMA”) and the Washington Consumer Protection Act (“CPA”)—the latter predicated solely on an underlying CEMA violation.
First, Robinhood says, Plaintiffs’ concession that Robinhood users were solely responsible for deciding whether, when, and to whom to send editable text messages using the native text applications on their personal mobile devices means they cannot plausibly allege that Robinhood provided “substantial assistance” to the Robinhood users who transmitted referral texts to Plaintiffs.
Second, Plaintiffs fail to plausibly allege facts to show that Robinhood knew or consciously avoided knowing that the initiator of the commercial electronic text message was engaged, or intended to engage, in any practice that violates the consumer protection act. Robinhood users, whom Plaintiffs concede are not operating as businesses when sending the texts, cannot violate CEMA unless they themselves conduct business in the state.
Robinhood argues that the Court should reject Plaintiffs’ attempt to hurdle this deficiency by arguing for strained CEMA interpretations that are inconsistent with CEMA’s plain language and would render this requirement superfluous.
Finally, according to Robinhood, the plaintiffs fail to dispute that the text messages at issue—which offered only free stock for joining Robinhood for free—cannot meet CEMA’s plain-language definition of a “commercial electronic text message,” defined as a message “sent to promote real property, goods, or services for sale or lease.” The broker says the Court should reject Plaintiffs’ attempt to create a new “commercial in nature” standard that is untethered from CEMA’s plain “for sale or lease” language.