A key Jiffy Lube franchisee faces paying out millions of dollars in compensation for sending unsolicited texts.
The settlement could reach as much as $47m for Heartland Automotive Services, Jiffy Lube's largest US franchise with 500 quick-lube outlets across the country. The sum is to settle a legal class action which dates back to April 2001, when Heartland was alleged to have sent text messages to more than 2.3 million consumers.
The messages were of a promotional nature and were, according to the lawsuit, sent without the phone owners' consent. According to US law, under the Telephone Consumer Protection Act (TCPA) promotional text messages require some form of clear consent from the recipient before they are sent. The TCPA, which was introduced in 1991, applies to 'telephone solicitations' which includes telemarketing calls, faxes and text messages.
The settlement, which is due for approval by a San Diego court on 17 September will require Heartland to issue certificates providing those involved in the class action a $17.29 discount off any of Jiffy Lube's services. This will be reduced to $12.97 if the certificate is unused after 18 months.
Heartland had originally asked for the case to be dismissed in October last year, arguing the plaintiffs failed to state a claim under TCPA; that plaintiffs gave consent to the text message promotion by releasing their telephone numbers to Heartland while having service performed at Jiffy Lube; and that imposing TCPA liability on Heartland would violate Heartland's constitutional rights under the First and Fifth Amendments. The motion was denied by the court and Heartland subsequently agreed to a settlement.
It appears that other high profile class actions based on the TCPA may be imminent with lawyers involved in the Heartland case also investigating possible action against Dell and the Huffington Post, amongst others.