Robinhood under fire (again) for “refer-a-friend” campaign
Online trading company Robinhood has come under fire again over its “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. Robinhood has sought to rebuff the allegations about the spam texts.
On Thursday, September 30, 2021, the plaintiff filed a reply to Robinhood and reiterated his position that the company is violating Washington’s Commercial Electronic Mail Act (CEMA).
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 argues that it did not “initiate” the illegal texts. But Moore says that this argument ignores that “assisting” is illegal in its own right and that Robinhood’s argument wrongly focuses on the meaning of terms as they are used under the federal Telephone Consumer Protection Act, 47 U.S.C. § 227 et seq. (“TCPA”).
Plaintiff does not assert a TCPA claim. Unlike the TCPA, in certain circumstances, the CEMA specifically incorporates “assisting the transmission” into the definition of “initiate the transmission.”
Moore also says that Robinhood wrongly contends that the referral texts are not sufficiently “commercial” under the CEMA because Robinhood does not offer its services for sale. That is not the test, the plaintiff argues.
All Plaintiff needs to allege is that Robinhood intended that text recipients would use the Robinhood app to access Robinhood’s for-profit services. That is exactly what happened here, Moore concludes.
The lawsuit continues at the California Northern District Court.