Cash App Faces $12.5M Lawsuit Payout Over Spam Texts in Washington

After residents of Washington state accused Block Inc. grandmother of Cash App to unlawfully send out promotional messages to them, the company has settled a significant case of class action. The settlement of the case that is currently finalized at a sum of $12.5 million is potentially going to impact about 2 million individuals.

In November 2023, trial attorney Kimberly Bottoms of Washington filed the suit. Put simply, the main claim was that Cash App exploited the provision of “Invite Friends” feature reference in unsolicited marketing messages and contravenes consumer privacy legislation at the state level. Block Inc. agreed to settle without admitting wrongdoing.

What the Lawsuit Was About

The suit centered around two key Washington laws:

• The Washington Consumer Electronic Mail Act, which protects individuals from unsolicited commercial communications.
• The Washington Consumer Protection Act, which safeguards residents from deceptive or unfair business practices.

Kimberly Bottoms alleged that Cash App had referred messages to people who have not subscribed to them, which was perceived to be an act of privacy violation.

Who Can Claim the Settlement?

Only the people living in the state of Washington, who have got such promotional messages after November 14, 2019, can qualify. The deadline on entitlement remains undetermined and is subjected to those that received the messages within the concerned time frame.

Block Inc. will resort to phone records to identify the eligible and inform them through emails or physical mail. The number of potential members of the class action group is about 2 million people.

As the number of valid claims increases, the number of people getting payout decreases as the payout per person increases. Due to the 2 million people who are eligible, considering every single one takes part in it, this would result in compensation of between 88 and $147 per person.

Block is supposed to contact deserving candidates directly. There is no official form or web page that has been posted yet to file a claim. It is recommended that users monitor their emails and post to be on the lookout of official communication by Block.

It is not the first issue that Block Inc. has to deal with regulatory scrutiny. In 2024, in another common action lawsuit, the company paid 15 million dollars due to the accusations of misusing data. Subsequently, it was fined by the Consumer Financial Protection Bureau, facing penalties in excess of 175 million dollars due to several data security breaches.

With these frequent problems, people have become wary of the way Block handles user data and how it is respectful to privacy regulations.

What’s Next?

Although the current settlement only deals with the residents of Washington, legal minds have felt that it may spur other lawsuits in other states in the United States where unsolicited messaging is urged to be restricted too. The decision on this case would act as a precedent to how tech companies would manage marketing communications in future.

No answers have been taken yet by Block Inc. on whether they will change or take off the so-called feature of Invite Friends after this settlement.

Until then, residents eligible for compensation should:

• Monitor email and postal mail for communication from Block Inc.
• Avoid third-party claim websites unless officially endorsed.
• Stay updated via official Cash App communication channels.