Allstate Reaches $6.5M Spam Fax Class Action Settlement

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This week, Allstate Insurance Company and consumers reached a $6.5 million settlement to resolve claims that the company sent spam faxes to thousands of California residents, violating the Telephone Consumer Protection Act.

The proposed Allstate class action settlement bookmarks $53,000 for settlement administrator fees, $7,500 to the named plaintiff, as well as attorney fees.

Legal representation have stated that they will seek to receive 30 percent of the settlement funds.

U.S. District Judge William Alsup granted preliminary approval to the Allstate settlement agreement on Wednesday.

In his statement, Judge Alsup stressed that he wanted to make sure that Allstate would not attempt to use this settlement to get out of claims outside of the realm of those he had certified for this settlement.

To that end, he required the company to remove language that would qualify any claim that “could have been brought” forward as part of the class action lawsuit, arguing that that wording was too vague, and would allow the company to not have to face repercussion for a wide range of claims.

Nonetheless, he deemed the proposed Allstate TCPA class action settlement deal to be acceptable to move forward, stating that “the broad terms settlement is in the reasonable category — at least reasonable enough to send out notice.”

The TCPA affords $500 in damages for each violation of the TCPA, and had the consumers won their case in court, Allstate would have had to pay that amount per fax. The settlement deal will effectively give consumers $375 per fax.

Class Counsel expressed approval of the settlement deal saying it is an “excellent result for the class.”

The Allstate spam fax message class action lawsuit was filed by plaintiff John Etter in January 2017. He claims that on Oct. 11, 2016, the company sent out multiple faxes to private individuals that advertised Allstate’s car insurance, and possible insurance savings.

Allegedly, the faxes stated that recipients had to make a call to Allstate to be removed from the company’s contact list and to not receive future fax messages.

Etter argued that these faxes violated the TCPA’s regulations, which requires businesses to obtain an individual’s prior, written, express consent before contacting them to advertise services or solicit business. Etter claims that Allstate did not seek his express consent before sending him the faxes or the express consent of other consumers.

Additionally, he alleges that the company violated the TCPA by requiring consumers to “opt out” of the faxes by contacting the company to request no further contact, as opposed to letting them “opt in” by signing up for promotional advertisements.

The Allstate TCPA violations class action lawsuit was granted Class certification by Judge Alsup. More than 15,000 potential Class Members, or people who may have received the Oct. 11, 2016 faxes, were notified of the class action lawsuit.

The $6.5 million settlement agreement was reportedly reached after two rounds of negotiations between the company and consumers, led by U.S. Magistrate Judge Jacqueline Scott Corley.

Top Class Actions will post updates to this class action settlement as they become available. For the latest updates, keep checking TopClassActions.com or sign up for our free newsletter. You can also receive notifications when this article is updated by using your free Top Class Actions account and clicking the “Follow Article” button at the top of the post.

Etter is represented by Brian Wanca and Ryan Kelly of Anderson + Wanca, and by Robert Schubert and Willem Jonckheer of Schubert Jonckheer & Kolbe LLP.

The Allstate Spam Fax Class Action Lawsuit is Etter v. Allstate Insurance Co., et al., Case No. 3:17-cv-00184, in the U.S. District Court for the Northern District of California.

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If you were contacted on your cell phone by a company via an unsolicited text message (text spam) or prerecorded voice message (robocall), you may be eligible for compensation under the Telephone Consumer Protection Act.

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