The Federal Trade Commission (“FTC”) recently entered into a court-approved settlement agreement with Jason Q. Cruz, individually and doing business as Appidemic, Inc., who was accused of transmitting unsolicited commercial text messages offering consumers free merchandise, including $1,000 gift cards to large retailers and iPads.
According to the FTC, none of the merchandise actually was free. In fact, consumers who clicked on any of the links in the subject text messages were taken to websites that requested their personal information and required them to sign up for trial offers to “qualify” for free merchandise. In most instances, the trial offers included monthly recurring charges that were billed to the consumer.
As part of the settlement filed in Illinois federal court, the defendant agreed to a number of injunctions, including being permanently enjoined from transmitting, or assisting others in transmitting, any unauthorized or unsolicited commercial electronic text messages to mobile telephones or other wireless devices. The defendant must also – for the next twenty years – submit a sworn notice to the FTC whenever he, for example, changes his residence or changes his role in any business.
The defendant also agreed to a suspended judgment of $185,041.26, which amount represented the money that had been made in connection with the alleged scam. Only $10,000.00 of that amount was actually paid, however. The defendant provided the FTC with sworn financial records demonstrating an inability to pay the total amount, so the FTC agreed to suspend the judgment (with the exception of the $10,000.00 payment directly to the FTC).
This settlement is only a small part of the FTC’s massive crackdown on commercial text message spam.
If you are interested in learning more about this topic or need to review your marketing practices, please e-mail us at info@kleinmoynihan.com, or call us at (212) 246-0900.
The material contained herein is provided for informational purposes only and is not legal advice, nor is it a substitute for obtaining legal advice from an attorney. Each situation is unique, and you should not act or rely on any information contained herein without seeking the advice of an experienced attorney.
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