Class Action 41858-08-16 Gavison: settlement over Mizrahi Tefahot advertising messages without a removal mechanism

Background and facts: Mizrahi Tefahot Bank advertising messages and the Spam Law

The proceeding Class Action 41858-08-16, Gavison et al. v. Mizrahi Tefahot Bank, was conducted in the Haifa District Court. On October 30, 2016, Gavison and two other applicants filed an amended motion to certify a class action against the bank. The claim was that the bank breaches section 30A of the Communications (Telecommunications and Broadcasting) Law, known as the "Spam Law".

According to the motion, the bank sent advertising messages without the express consent of the recipients. It was alleged that it was not possible to remove oneself from the mailing list in the same way the message was received, but only by calling a telephone number, without a simple and convenient option as the law requires. It was also alleged that the bank did not add the word "advertisement" to the subject line of the messages.

The parties' arguments

The bank denied the claims. It argued that its messages are not "advertising material" under the law, and are not part of the "junk mail" phenomenon the law was intended to eradicate. Alternatively, it argued that the messages were sent to those who agreed to receive them, including the three applicants. The applicants denied this.

Regarding removal, the bank argued that it allows simple and reasonable removal in several ways: telephone, a dedicated web page, a branch and fax. It also argued that no damage was caused, that the applicants have no personal cause of action and that the motion is not suitable to be heard as a class action.

What the court decided: a withdrawal given the force of a judgment

The proceeding did not end with a decision on the merits, nor with a settlement for the benefit of the class. It ended with the applicants' withdrawal from the motion for certification, under section 16 of the Class Actions Law. Senior Judge Yigal Griel approved the withdrawal and gave it the force of a judgment on January 31, 2018.

At a pretrial hearing on February 2, 2017, the court proposed an outline: the bank would examine and propose technological mechanisms for removal by text message and by email, and in addition an award, legal fees and a donation to the public would be paid. In April 2017, the bank announced that it had adopted the proposal, beyond the letter of the law and without admitting the claims. According to the bank's notice, the removal methods were updated as follows:

• In text messages: removal from the mailing list can be requested by sending back the word "remove" (haser).
• In email messages: in addition to the link to the removal page on the bank's website, the address of the page will be written in the body of the message.
• In the subject line of email messages that include, prima facie, advertising content, the word "advertisement" will be added.

The payment questions were settled in mediation before retired Judge Hila Gerstel. The bank was ordered to transfer NIS 25,000 to the "Kav LaChaim" nonprofit by March 5, 2018, and to file an affidavit and a confirmation from the nonprofit that the amount was received. It was also ordered to pay by March 15, 2018 legal fees of NIS 43,000 to Adv. Dikla Asayag-Yirmiyahu, counsel for the first two applicants, and NIS 57,000 to Adv. Shlomi Cohen, counsel for the third applicant, including VAT. An award of NIS 30,000 was granted to the first applicant, and NIS 10,000 to each of the other two applicants.

The bank clarified that its consent was given beyond the letter of the law and for reasons of efficiency, without admitting any cause of action. The court held that the arrangements are reasonable and balanced, and that the applicants pointed, prima facie, to a cause of action. The bank's undertakings to update the removal methods are part of the judgment, and the bank was ordered to file by March 5, 2018 an affidavit detailing its actions. The motion for certification was struck out, and the personal claims of the three applicants were dismissed.

The parties were exempted from publishing a notice and from sending a notice of the withdrawal. The court reasoned that the withdrawal does not create res judicata, except with respect to the three applicants.

Quotes from the judgment

"I believe that the arrangements and agreements as detailed in the withdrawal motion are reasonable and balanced."

Section 13 of the judgment (translated from Hebrew).

"The applicants pointed prima facie, at the very least, to the existence of a cause of action, and it appears that the class members may benefit from the arrangements reached within the framework of the withdrawal motion."

Section 15 of the judgment (translated from Hebrew).

What it means for Mizrahi Tefahot customers

As part of the judgment, the bank undertook to allow removal from advertising text messages by sending the word "remove", to write the address of the removal page in email messages, and to add the word "advertisement" to the subject line of email messages with advertising content. The undertaking was given without admission of the claims, and the court did not decide whether the bank breached the Spam Law.

Customers did not receive money in this proceeding. The amounts were paid as a donation to a nonprofit, as an award to the applicants and as legal fees. Further privacy and personal information topics are collected in the privacy section, and further class actions against the bank on the class actions page.

Sources

• The judgment in Class Action 41858-08-16 Gavison et al. v. Mizrahi Tefahot Bank, January 31, 2018 (PDF, law.co.il website)

Frequently asked questions about court rulings against Mizrahi Tefahot Bank

How to cite

Class Action 41858-08-16 (Gavison et al. v. Mizrahi Tefahot Bank), Haifa District Court, 31.01.2018. Source: Net HaMishpat (Israeli courts database), case Class Action 41858-08-16 (Gavison et al. v. Mizrahi Tefahot Bank).