NEW YORK (Legal Newsline) – Facing a class action lawsuit involving alleged spam text messages, American Eagle Outfitters has agreed to settle the proposed lawsuit by paying a large settlement to the plaintiffs.
According to documents filed in a New York federal court, the class action suit accused American Eagle Outfitters of violating the
Telephone Consumer Protection Act by sending many unsolicited text
message advertisements to unsuspecting random consumers.
On April 8, 2014, Fitapelli &
Schaffer LLP filed the lawsuit on the behalf of those
who received the allegedly unsolicited text messages. The lawsuit claims that
the plaintiffs received the unsolicited text messages from American
Outfitters Inc. and AEO Management without first allowing the
consumers to express written consent.
According to one of the plaintiffs,
numerous text messages had been sent from American Eagle Outfitters and
AEO Management to her phone since February 2014. Although the
plaintiff alleges she never gave her written consent to receive such messages,
she still received many messages advertising American Eagle
Outfitters promoting its jeans, shorts, flip-flops and a
new clothing line for dogs.
According to the Telephone Consumer
Protection Act, which was established in 1991 in response to consumer
complaints regarding telemarketing practices, it is unlawful to make
phone calls, send text messages, or send messages by fax to potential
consumers for commercial purposes without first receiving the said
consumer's prior express written consent. When a company violates
this act by communicating with consumers with prior consent, the
consumer is entitled to receive statutory penalties, which range from
$500 to $1,500 for each violation.
Also at the center of the dispute was
Experian Marketing Solutions Inc. and its role in the alleged TCPA violation. American Eagle Outfitters Inc.
held Experian Marketing Solutions Inc. liable for the violation.
According to American Eagle Outfitters Inc., Experian signed a
contract in 2009 in which Experian agreed to provide email marketing services
while also indemnifying American Eagle for any legal troubles.
2013, the agreement was expanded to also include advertising by way
of text message. While U.S. District Judge Valerie Caproni dismissed
American Eagle's claims that Experian should be held liable in
November 2015, Caproni granted American Eagle's bid
to file a third-party complaint against Experian on May 3, 2016.
In order to end the dispute, American
Eagle Outfitters settled the class action suit for $14.5 million in
December. The class consisted of more than 600,000 unique phone
numbers, with the customers claiming that the unsolicited texts began
in April 2010. In this settlement, which combines separate class
actions from New York, Florida and Illinois, each class member will
receive between $142 and $285.
All additional funds that are left
over after each class member has been compensated will be disbursed
to the National Consumer Law Center.