Robinhood under fire for illegal spam texts
Online trading app Robinhood is under fire again – this time, for allegedly sending spam messages. Cooper Moore, a citizen of Washington State, residing in King County, Washington, has taken Robinhood Financial LLC to Court over a refer-a-friend text message.
The complaint, seen by FX News Group, was submitted at the California Northern District Court, on August 9, 2021.
The plaintiff notes that, in order to market its products and services, Robinhood created a referral program called “Refer a Friend.” Robinhood encourages users to refer their contacts to the service by offering free stock for each successful referral. As soon as the user’s contact signs up for Robinhood and links his or her bank account, Robinhood credits both the referring user and the referred contact with reward stock—sometimes offering more than one free stock for each successful referral.
Robinhood’s mobile application assists users in referring friends. All the user has to do is tap “Rewards” or “Earn Rewards”, tap “Invite Contacts”, and tap “Invite” next to the contacts the user wants to refer. The Robinhood App also displays alerts to users within the application reminding them to “Invite Friends” to earn free stock.
The refer-a-friend model is a powerful method of mass marketing. At very minimal cost, Robinhood achieves targeted, immediate, and extensive promotion of its brand.
The Complaint alleges that Robinhood initiated and/or assisted in sending to the plaintiff a refer-a-friend text message while the plaintiff was a Washington resident.
Robinhood’s conduct allegedly violated the Washington Consumer Electronic Mail Act (“CEMA”), RCW 19.190.010 et seq., which makes it illegal for a person to “initiate or assist in the transmission of an electronic commercial text message to a telephone number assigned to a Washington resident for cellular telephone or pager service…” RCW 19.190.060.
“Assist the transmission” means “actions taken by a person to provide substantial assistance or support which enables any person to formulate, compose, send, originate, initiate, or transmit a commercial electronic mail message or a commercial electronic text message when the person providing the assistance knows or consciously avoids knowing that the initiator of the commercial electronic mail message or the commercial electronic text message is engaged, or intends to engage, in any practice that violates the consumer protection act.” RCW 19.190.010.
A violation of CEMA is a “per se” violation of the Washington Consumer Protection Act (“CPA”), RCW 19.86.010, et seq. RCW 19.190.100; Wright v. Lyft, Inc., 406 P.3d 1149, 1154-55 (Wash. 2017).
The plaintiff brings this action as a class action on behalf of persons who also received Robinhood’s illegal spam texts.
Moore’s requested relief includes an injunction to end these practices, an award to plaintiff and class members of statutory and exemplary damages for each illegal text, and an award of attorneys’ fees and costs.