• by Wendy Davis  @wendyndavis, December 12, 2014

A federal judge has rejected Yahoo's argument that it's entitled to prevail before trial in a potential class-action lawsuit alleging that it sent consumers unsolicited SMS messages.

Instead, U.S. District Court Judge Manish Shah in the Northern District of Illinois ruled on Thursday that factual questions surrounding the mechanics of Yahoo's SMS-sending system warrant further proceedings.

The lawsuit — one of a few SMS-related cases against Yahoo — centers on a Yahoo Messenger feature that converts instant messages into text messages. Two consumers -- Rachel Johnson and Zenaida Calderin, who allege that they received those converted text messages, argue that Yahoo violated the Telephone Consumer Protection Act. That law prohibits companies from using automated dialers to send SMS messages to people.

Yahoo allegedly sent at least two text messages to both of the consumers. The first allegedly came from other users, while the second allegedly offered Yahoo's explanation for why it sent the first message. The lawsuit stems only from the explanatory messages.

Yahoo argued that it was entitled to summary judgment on the ground that its system didn't rely on automated dialers. The company argues that its system didn't randomly generate numbers of recipients, but instead only sent SMS messages to people whose contact information initially came from other users.

But the consumers argued that Yahoo gleaned some of those messages through automated processing of address-book contacts, according to the opinion.

Shah denied Yahoo's request for summary judgment because the consumers presented evidence showing that its system can message numbers extracted from address books. At the same time, he also denied the consumers' request for summary judgment, ruling that the consumers hadn't yet proven that the messages were sent by automated dialers.

Questions about what constitutes automated dialers are at the center of another lawsuit accusing Yahoo of violating the Telephone Consumer Protection Act. In that case, Yahoo was sued by a Philadelphia man who allegedly received 27,000 unwanted text alerts, which apparently were meant for the phone's previous owner.

U.S. District Court Judge Judge Michael Baylson in the Eastern District of Pennsylvania ruled in Yahoo's favor in March, when he granted the company summary judgment on the grounds that Yahoo's system isn't an automated dialer.

Dominguez recently asked the 3rd Circuit Court of Appeals to reverse Baylson's ruling and reinstate the lawsuit. That court is still considering the matter.