Pizza Hut To Settle TCPA Class Action Lawsuit For $6M

Pizza Hut recently agreed to pay $6 million to resolve TCPA class action lawsuit claims that they sent unsolicited text messages to consumers.

The settlement will reportedly benefit people who received a spam text from Pizza Hut between November 2010 and January 2013. There are reportedly over 13,000 eligible cell phone numbers included in the settlement.

Under the settlement, each Class Member will be able to collect up to $400 in payments. In the motion for settlement approval, plaintiff Brian Keim calls this payout an “outstanding result” for Class Members – especially considering that each claimant is expected to receive the full $400. Payments would only be reduced if there were far more claims filed than expected.

One-third of the settlement fund, or $2 million, will reportedly be set aside to cover attorneys’ fees. Keim will reportedly receive a $10,000 incentive award for his services as the named plaintiff.

The $6 million settlement costs will reportedly be covered by several Pizza Hut and the larger ADF group of companies. ADF MidAtlantic LLC, ADF Pizza I LLC, and ADF PA LLC will reportedly cover 60 percent of the fund while American Huts Inc. will reportedly fund the remaining 40 percent of the settlement.

Pizza Hut TCPA Class Action Lawsuit

Keim filed his Pizza Hut class action after he allegedly received text messages from the pizza franchise. According to his TCPA class action lawsuit, these text messages were sent to thousands of consumers without their consent.

Pizza Hut allegedly got consumer phone numbers through their “friend forwarder” campaign. Under this promotion, people signed up for Pizza Hut deals that were sent via text message. These consumers were then allegedly given the option to sign up their friends for similar deals. Unfortunately, these friends and family members had allegedly not consented to receive text messages from Pizza Hut.

Keim claimed that the unsolicited text messages violated the Telephone Consumer Protection Act.

The TCPA (Telephone Consumer Protection Act) is a federal law that was enacted by Congress in 1991 with the goal of protecting consumers from harassing telemarketing calls. Since its passing in the 1990s, there have been several additions to the law to make it more relevant to evolving technology. Rules for text messages and faxes have been added as well as terms regarding the use of an automatic dialing system.

In 2012, TCPA received a huge legal boost when new rules strengthened its protections. Under these rules, businesses are not allowed to call consumers without their prior express written consent. This means that businesses can no longer justify their telemarketing communications with an “established business relationship.” Rule changes at this time also required telemarketers to include opt-out mechanisms in robocalls so consumers can immediately tell the company they want the calls to stop.

If businesses violate TCPA with unsolicited texts, calls, or faxes, consumers may be eligible to take legal action as Keim did in his TCPA class action.

The TCPA Class Action Lawsuit is Keim v. ADF MidAtlantic LLC, et al., Case No. 9:12-cv-80577, in the U.S. District Court for the Southern District of Florida.

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This article is not legal advice. It is presented 
for informational purposes only.