All About Square Lawsuits

Square was the subject of a lawsuit filed in April 2021 alleging that the high fees imposed on merchants were unreasonable. The merchants alleged that these credit card processing fees violated antitrust and unfair competition laws. Four merchants filed a class-action lawsuit together seeking a court directive forcing the company to change their credit card surcharges and offer compensation.

Square faced a class action lawsuit in 2020 over TCPA violations and unsolicited texts. In this lawsuit the plaintiffs allege that they receive text messages from the company without giving their consent. They entered their phone numbers when making payments using a Square POS system in order to earn loyalty rewards from the business, not from Square. After that, he received automated text messages from Square, even though he never provided consent to receive notifications. He claims that these text messages were a violation of his privacy, intruded on his personal life and were considered a nuisance especially when they came from automated telephone dialing systems.

Remember how former employees, government agencies, and other groups are more likely to file lawsuits against companies like Square? That’s what happened with an October 2021 lawsuit filed by shareholders. Shareholders filed a lawsuit after the acquisition of AfterPay Limited. The lawsuit alleges that the company did not propose a vote regarding this acquisition to the shareholders in direct violation of the law. 

In this Square lawsuit, the company faced a class action lawsuit saying that the software provider failed to protect medical cata from its customers, violating HIPAA laws. Health care providers use the service for payment processing and some of them send payment confirmation via text message and invoices via text message, often sending to the wrong number and in so doing sharing medical information with other people.

This lawsuit, filed in California states that the company was fraudulent, negligent, and utilized unfair and deceptive actions with the merchant payment holds. It was alleged that Square tried to hold 30% of all plaintiff transactions without plaintiff’s authorization, something made worse by the fact that it was done during the covid-19 crisis. The company unilaterally instituted a 120-day hold on 30% of all transactions with very little warning and vague legal explanations as to why. There are also no terms included in the payment processing terms that address this issue giving Square no legal grounds for their actions.

In 2018 Square agreed to pay 2.2 million dollars for a class action lawsuit alleging that the delivery service owned by Square, Caviar, collected tips on behalf of drivers but did not give them out. The plaintiff said he was required to pay an 18% gratuity on all of the purchases he made using this delivery service but that 18% gratuity for delivery drivers was never actually given to the drivers. It was presented to customers as a driver tip, not a service fee.