Firm History: Heyrich Kalish McGuigan Represents Consumers in Class-Action Lawsuit against Papa John’s
In November 2012, Heyrich Kalish McGuigan PLLC announced that a federal court in Seattle certified a class-action lawsuit against Papa John’s International over the company’s text message advertisements. The lawsuit helped promote consumers’ rights to privacy and should serve as a “wake-up call to advertisers,” as attorney Donald Heyrich, who represented the class, put it.
The Reason for the Class-Action Lawsuit
In 2010, Papa John’s began sending text messages to customers. The messages advertised deals and specials for its pizza. The messages were sent in bulk, with some customers reportedly receiving 15 text messages consecutively, even at odd hours of the night. Many requested that the messages cease.
Instead, Papa John’s continued texting, sending multiple copies of the same message to the same people time and time again. “Many customers complained to Papa John’s that they wanted the text messages to stop,” Heyrich said, “and yet thousands of text messages were sent week after week.”
And because none of the customers had given Papa John’s permission to use their phone numbers, the text messages were being sent out in violation of the law, which would become the basis of the class-action suit.
The Telephone Consumer Protection Act of 1991
The text messages sent to Papa John’s customers were in violation of the Telephone Consumer Protection Act of 1991. The first telephone consumer protection act of its kind, the 1991 legislation made it illegal for companies and telemarketers to contact a person after the person requested to be put on a “Do Not Call” list.
Not only did the law require the companies to stop making contact upon the consumer’s request (something that Papa John’s failed to do), but the law also stipulated the hours during which marketers could make contact with consumers. According to the Federal Communications Commission, the law forbids telemarketing calls before the hour of 8:00 a.m. or after 9:00 p.m. Furthermore, all solicitors must provide their names, a telephone number or address at which they can be contacted, and the name of the entity on whose behalf the call is being made.
Once a consumer requests a company to stop calling, the company has 31 days to remove the person’s name from calling lists. If it fails to do so, the company may be at risk of a fine. The law also made it possible for customers to file complaints against solicitors who contact them illegally. The act can result in a penalty of $500 per illegal contact. The act also requires that companies obtain customers’ permission before sending text messages, something Papa John’s failed to do.
Papa John’s Denies Liability
Papa John’s denied liability for the mass text messages. It pointed to a third-party company, OnTime4U, which it said some of its franchises hired years prior. Caroline Oyler, senior vice president of legal affairs for Papa John’s, said that the company had expressed concerns but couldn’t tell the franchises how to conduct business, reported ABC News.
But Heyrich said that the opinion by the federal court certifying the class-action suit speaks for itself regarding whether the text messages were part of a company program. When the claim was initially filed, Papa John’s stated that it planned to appeal the certification of the class action case.
Papa John’s Settles the Class Action Lawsuit
Heyrich Kalish McGuigan PLLC represented the class in filing a class-action lawsuit against Papa John’s seeking potential damages in excess of $250 million. The lead plaintiffs in the case were Maria Agne, Erin Chutich and Jerrod Chutich. In addition to Papa John’s International, the lawsuit named five franchises as defendants in the case.
In May 2013, the case settled for $16.5 million. Of the $16.5 million, more than $11 million was reserved to be made in cash payments to the customers who illegally received a text message from the pizza chain, and $2.86 million would go towards merchandise certificates providing members of the class a free pizza voucher. The estimated number of people affected by the illegal text messages was thought to be approximately 222,000.
In the end, the settlement agreement awarded each claimant $50 and a free pizza and was done with the agreement that the claim against Papa John’s would be dropped. But the impact of the case – and others like it – could be even further reaching.
The Impact of the Papa John’s Class Action Lawsuit
The outcome of the class-action lawsuit reaffirmed the rights of consumers in terms of both privacy and the right to keep their mobile device spam-free. Heyrich, who represented the class in the lawsuit, summed it up nicely when he said that the lawsuit should serve as “a wakeup call to advertisers. Consumers do not want spam on their cell phones. If you do not have permission from your customers, don’t send them text messages. It’s as simple as that.”
Other class-action lawsuits also have been successful. One suit, filed against a Jiffy Lube franchisee that also sent spam text messages to customers, resulted in a settlement that ultimately may be worth between $35 and $47 million. It provided vouchers that customers of the franchise may redeem for service or cash.
Additionally, the lawsuit should serve as a reminder that if you’re a consumer whose rights have been violated, you’re not alone. Even when facing a sizeable opponent – such as a Fortune 500 company – an attorney can help you protect and exercise your rights.