In one of the first lawsuits of its kind targeting an Android app maker and advertiser, a Colorado law firm has filed a class-action complaint against Colorado-based GoLive Mobile and California-based Airpush, alleging the two worked together to bilk Android phone users out of millions of dollars by paying for premium wireless services they never wanted. Attorneys claim GoLive and Airpush purposely tricked customers by creating mobile ads that looked like official Android system notifications.
Filed in the U.S. District Court of Colorado late Tuesday, attorneys at Edelson and McGuire, representing Kimm Nordman of Ohio, claim mystery charges on potentially over 100,000 wireless bills can be traced to Android apps made by GoLive Mobile and ads distributed by Airpush.
Company representatives at GoLive Mobile and Airpush have not returned inquiries requesting comment for this story.
(See Related: Sneaky mobile ads invade Android phones)
The lawsuit alleges that GoLive Mobile worked with Airpush, a mobile advertising firm, to create situations where an Android smartphone user would be tricked into submitting his or her phone number to GoLive, a move that would establish an ongoing billing relationship with the wireless customer. Charges for premium mobile services, such as text alerts for weather and celebrity gossip, of up to $9.99 would appear on customers monthly statements. Premium GoLive services include Jumpah, App Tram, and ZapVideo.
"Cramming a wireless telephone bill is not novel," said Chandler Givens, an attorney with Edelson and McGuire. "What is novel is cramming using these new technologies to facilitate the same old tricks." Cramming is a term that refers to the practice of placing unauthorized, misleading or deceptive charges on a telephone bill.
System Message or Advertisement?
Edelson and McGuire claim push notification ads were delivered to Android phone users displaying what appeared to be upcoming calendar events or new email notification messages in a phone's notification bar. Those ads, attorneys maintain, were triggered by previously installed Android apps. When phone users clicked on the notifications, attorney allege, a drop-down menu displayed information about the notification appearing next to "official-looking" messages indicating "an update is available to the Android Market."
Next, Android phone users are forwarded to a mobile website where GoLive requests the wireless telephone number, according to the lawsuit. Once GoLive has the user's phone number, attorneys claim, it submits the phone number to a wireless carrier as confirmation the end user opted-in to a billing relationship for a premium text message service.
Attorneys are seeking undisclosed damages on the behalf of the plaintiff and others impacted by the alleged unauthorized charges and deceptive practices of GoLive Media and Airpush. Attorneys maintain that both companies are in violation of Colorado consumer protection laws.
GoLive was ranked as the fastest-growing media company in 2011 on Inc. 500 list. Airpush is ranked as the second-largest ad network for Android with an estimated 40,000 developers. "Mobile computing is the future of technology," Givens said. "As with any emerging market, the need to establish protections for retail consumers is paramount. Lawsuits such as this are part and parcel to that process."