Path is among the numerous Web companies to face recent lawsuits for allegedly violating the Telephone Consumer Protection Act, which prohibits the use of automated dialers to send SMS messages to people without their consent.
The company allegedly sent SMS ads to people inviting them to join the service. Like other social networking services, Path allegedly made it appear as if the ads came from users' friends, rather than the company.
Path asked for the case to be dismissed at a preliminary stage, arguing that the consumer who sued, Kevin Sterk, didn't offer enough facts in its complaint to show that that the company used an automated dialer to send the messages. Path also argued that Sterk didn't show that the messages came from the company, and not his friend.
But U.S. District Court Judge Samuel Der-Yeghiayan in the Northern District of Illinois rejected Path's argument. Der-Yeghiayan ruled that Sterk's allegations were strong enough to suggest that Path used an autodialer, and that additional facts would come out as the case moved forward.
Meanwhile, whether Path is vindicated in court or not, it's safe to say that many people dislike the kind of aggressive growth strategy the company is accused of using.
Of course, if the allegations are true, Path would hardly be alone in sending invitations to users' friends. For example, LinkedIn was sued last month for “hacking” users' emails by harvesting their contacts and sending them invitations to join that appeared to come from the users, as opposed to LinkedIn. (Unlike Path, LinkedIn isn't accused of sending the messages via SMS.)
In that case, the users said that LinkedIn accessed their friends' email contacts even without first asking for email account passwords. For its part, LinkedIn says that it notified users and sought their consent before sending invitations to their friends.
Regardless of how the litigation plays out, these types of growth strategies might garner the social networks a few more members, but often at the cost of making the companies look like spammers. The strategies often also embarrass users, who realize too late that they have subjected their friends to an ad campaign. And the tactics annoy message recipients, who don't understand why they're being deluged with solicitations from friends to join social networking services.