Meal kit delivery titan HelloFresh has agreed to pay a staggering $14 million (£13 million) to settle a major class-action lawsuit in the United States, following accusations of bombarding customers with relentless spam texts and employing misleading discount tactics.
The legal action, filed in a New York district court, alleged the company violated stringent US telemarketing laws by sending out a flood of unsolicited promotional text messages. Customers claimed they never consented to receive these marketing communications, which were described as a persistent nuisance.
Beyond Spam: The 'Deceptive' Discount Claims
Beyond the spam allegations, the lawsuit also took aim at HelloFresh's promotional strategy. It argued that the company's heavily advertised discounts and 'free' box offers were fundamentally deceptive. The suit claimed that many new subscribers were unexpectedly hit with higher-than-anticipated recurring charges after the initial promotional period ended, feeling misled by the marketing fine print.
Who is Eligible for a Payout?
The substantial settlement fund is designed to compensate affected consumers. According to the terms, individuals in the US who received an unwanted HelloFresh text message between 18 October 2021 and the date the settlement receives final approval are potential claimants. Furthermore, customers who felt misled by the company's discount offers and subsequently signed up for a subscription may also be eligible for a portion of the payout.
While this is a US-specific case, it sends a powerful warning to subscription-based businesses operating in the UK. The UK's own data protection and electronic communication regulations, enforced by the Information Commissioner's Office (ICO), are similarly strict on unsolicited marketing, meaning companies here must ensure explicit consent for all promotional contact.
HelloFresh has not admitted any wrongdoing as part of the settlement agreement. The company stated the move was a strategic decision to avoid the continued cost and distraction of prolonged litigation. A final approval hearing for the settlement is scheduled for 19 September 2024.
