Yahoo will face a class action lawsuit after allegedly sending unsolicited text messages to Sprint users in violation of the Telephone Consumer Protection Act.
A Chicago federal judge this week allowed the suit to move forward, rejecting Yahoo's arguments that such a move would allow the company to be subject to disproportionate damages, among other claims. Yahoo could be liable for up to $1,500 in damages for each unwanted message in 2013 to non-Yahoo customers.
Up to 500,000 Sprint users may have received the messages, so Yahoo's exposure could be up to $750 million.
Yahoo is accused of sending the consumers automated welcome messages that were triggered when others sent them separate messages via Yahoo Messenger. The case was brought by an Illinois resident who said she received the unwanted welcome message after being sent a spam text message for a financial service.
Text messaging continues to drive a significant amount of legal battles. In 2013, AT&T, Sprint and T-Mobile entered into an agreement with 45 states to stop billing customers for premium SMS messages they receive. Verizon Wireless was not part of the settlement but said that it too will discontinue the practice. And in 2014, T-Mobile US sought to settle a lawsuit filed against it by the Federal Trade Commission that alleges the carrier netted hundreds of millions of dollars by knowingly charging customers for purported "premium" SMS subscriptions that, in many cases, were "bogus charges" subscribers never authorized.
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