Papa John's Lawsuit Could Cost Company $250 Million
Papa John's has come under fire in the wake of President Obama's re-election for saying the company would reduce workers' hours and lay off others in order to avoid paying for health care. Now, though, the company faces a $250 million lawsuit for sending illegal text messages to customers.
According to court documents, those who filed the petition claim they received a total of over 500,000 unwanted text messages in 2010. Attorney Donald Heyrich told CNN that some plaintiffs said they received as many as 15 or 16 texts in a row from the company, which uses a service in order to send the mass texts.
OnTime4U, the messaging service, has also been named in the lawsuit, though Papa John's stopped working with the company in April 2010. Papa John's allegedly told OnTime4U that sending massive amounts of unwanted text messages "is most likely illegal," CNN reported.
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"After I ordered from Papa John's, my telephone started beeping with text messages advertising pizza specials. Papa John's never asked permission to send me text message advertisements," plaintiff Erin Chutich said in a statement.
"We have noticed text message spam is increasing in part because advertisers see it as a great way to get their material directly into the hands of customers. We hope this case keeps text message spam out of cellphones," Heyrich explained.
As part of the suit, the plaintiffs have asked for $500 per unwanted text but could receive up to $1500 per message if the jury rules that Papa John's knowingly broke the law. However, Papa John's head of legal affairs, Caroline Oyler, has said that it was not the company's fault since the texts were sent "by third-party vendors and a small number of franchisees."
Even though the case was certified and allowed to proceed by a judge on Nov. 9, Papa John's plans to appeal the ruling.
"We don't agree with it and will continue to aggressively defend it. We'll continue to litigate the case and defend the lawsuit and move to have it dismissed," Oyler said.
The company has recently come under fire for statements made by CEO John Schnatter, who said he plans on letting go of workers and reducing their hours in order to reduce the cost of health care under President Obama's mandate.
"I got in a bunch of trouble for this," he said in a statement. "That's what you do, is you pass on costs. Unfortunately, I don't think people know what they're going to pay for this."
