Missouri District Court Rules that App Developer Is Not Subject to Personal Jurisdiction Based on App Users’ Contacts with the Forum
A recent ruling from the Eastern District of Missouri provides encouraging news for app developers who may be sued under the TCPA for messages sent by users of their app. The court declined to exercise personal jurisdiction over the defendant, the photo sharing app developer Everalbum, Inc., because the text messages sent to plaintiffs in the forum state were sent by users of the app, and Everalbum itself directed no messages into the forum. See Figueroa v. Everalbum, Inc., No. 17-1393, 2017 WL 4574797 (E.D. Mo. Oct. 12, 2017). The decision is a favorable one for software companies whose users may initiate SMS communications with persons throughout the country, thus implicating the TCPA.
Everalbum is a Delaware corporation with its headquarters in California. It owns and operates the Ever app, which allows users to share their photos and save them to the cloud. Users may also earn free storage by inviting their friends to download the app. In the Figueroa case, two plaintiffs (including one Missouri resident) filed a putative class action against the company in Missouri federal court based on their alleged receipt of unsolicited text messages inviting them to download the Ever app. Plaintiffs conceded that these texts were sent by new users who had downloaded the app (rather than by the defendant Everalbum), although the defendant encouraged and provided incentives (i.e., free storage) for users to send such texts to friends. To obtain the free storage space, the Ever app required the user to (1) permit access to the user’s contact list; (2) either approve an invitation to all of the user’s contacts or otherwise select certain contacts; and (3) “affirmatively process a button to cause invitation text messages to be sent” to the desired contacts. Id. at *1. Plaintiffs claimed that the text messages were sent via an “automatic telephone dialing system,” in violation of the TCPA.
Everalbum moved to dismiss for lack of personal jurisdiction, arguing it had no contacts with the forum state, Missouri. The court agreed and dismissed the action without prejudice. Central to the court’s reasoning was that the Ever app’s users—not Everalbum—were alleged to have initiated the text messages at issue. As such, the court flatly rejected plaintiffs’ argument that Everalbum contacted them in Missouri (or anywhere, for that matter), as other statements in plaintiffs’ Complaint conceded it was their friends who initiated the communications. As the court explained:
There is no evidence that Ever has [had] any contact with Missouri, let alone contacts sufficient to establish personal jurisdiction in this case. Ever is a company headquartered in San Francisco, California, with no offices, employees or assets in Missouri. Ever is not registered to do business in Missouri . . . . Plaintiffs offer bare allegations . . . that Ever contacted them, but these allegations are refuted by their own allegations. [Plaintiff] Figueroa acknowledges that her invitation to use Ever was initiated by Kathie Rose, her friend in New Hampshire. Likewise, [Plaintiff] Franklin admits that her invitation to use the Ever app was initiated by her friends Dana Kirksey and Elatris Van Hook.
Id. at * 2 (emphasis added). The Court concluded that it “cannot exercise personal jurisdiction over Ever simply because some of Plaintiffs’ friends utilized the invitation process . . . to invite Plaintiffs to use its app.” Id.
While each case will present unique facts related to the issue of personal jurisdiction, the Figueroa decision provides a sensible approach on the facts presented. And the decision should provide software companies named as TCPA defendants with some measure of relief, at least in contexts where they are not at “home” in the forum state and only their users initiate contacts with persons in the forum.