Papa Johns Faces Massive Spam Lawsuit
Pizza company Papa John's is in legal hot water after customers complained about huge amounts of text message spam sent to their mobile phones.
The company is alleged to have sent customers a total of 500,000 unwanted text messages in 2010. The messages were typically for deals on pizza, but the problem was that customers said they were getting as many as 15 or 16 text messages in a row. Some of them were even sent during the middle of the night.
"After I ordered from Papa John's, my telephone started beeping with text messages advertising pizza specials," Erin Chutich, one of the plaintiffs, said in a statement. "Papa John's never asked permission to send me text message advertisements."
Papa John's used a text message delivery service called OnTime4U, who are also included in the legal action. Papa John's allege that after complaints started coming in en masse, they ended their relationship with the company.
The Telephone Consumer Protection Act of 1991 is quite clear on what companies can and cannot do. It bars companies from sending text message adverts without the customer first having opted into it.
Papa John's however say that the rogue messaging was conducted by a small number of franchisees, using a third party system rather than the main corporate text messaging service.
Nevertheless, the lawsuit could see the company stung for enormous damages. The plaintiffs are looking for $500 for each text message they received. This however could rise to $1,500 if the jury believes that Papa John's willfully broke the law. This could see damages of $250 million awarded.
Caroline Oyler, Papa John's head of legal affairs, is confident it won't come to that however.
"We don't agree with it and will continue to aggressively defend it," she said. "We'll continue to litigate the case and defend the lawsuit and move to have it dismissed."
Shares of Papa John's fell by 1% on Tuesday and have fallen by nearly 2% since the judge ruled that the plaintiffs could join together.