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Microsoft, Best Buy Face Racketeering Suit
15 judges of the 9th Circuit Court of Appeals have unanimously reversed dismissal of a RICO class action suit against Microsoft and Best Buy, which claims the companies engaged in fraud in promoting Microsoft's MSN online service. (RICO is a statute originally intended to help prosecutors go after organized crime.) Quoting: "The case started after James Odom bought a PC-based laptop at a Contra Costa County Best Buy store. Data about the purchase was sent to Microsoft as part of a joint marketing agreement between the companies. Microsoft then signed Mr. Odom up for its MSN Internet service and, after a free trial period, began billing him for it." Howard Bashman's How Appealing blog has more details on the reversal, including a paraphrase from one of the appellate judges that "all blame rests with the U.S. Supreme Court for allowing the 'outlandish' result that a claim such as this can be pursued under RICO."
While it wasn't prosecuted under RICO, there have been similar issues with a number of adult website memberships. "Sign up for this for free, the credit card is for age verification only." Three days later, they bill you for a "recurring membership" for their affiliate sites that are just this side of impossible to opt out of. (This happened to a client-- I don't pay for my porn.)
In fairness, you kinda expect this from the seedier side of the web.
You don't expect it from Best Buy and the largest software company on the planet.
I have no idea how this particular issue will play out, but this court has had many decisions overturned, for reasons spelled out in the Wiki reference.
Not to punish promotion of multi-colored butterflies. Microsoft should be broken up into several companies and barred from anti-competitive practices. But this doesn't make any more sense than punishing P2P downloaders under laws passed to fight actual maritime pirates.
Yep, I worked for Best Buy for quite a long time and I know this was never a corporate policy (hardly anything the stores do is corporate policy. This protects corporate from being blamed on our horrendous practices while allowing us to meet their unrealistic expectations).
First, they expected us to sign up approximately 50-75% of all PC purchases with MSN accounts. My store trended about 15-20%... So our management took some advice they heard on a higher level... It's free, it comes with the PC. We were able to boost our numbers to about 50% attachment by not explaining what was happening during the process. We didn't explain it was a free trial, we didn't explain they had to cancel, we helped speed them through the process and I even witnessed some people using the touchpad for the customers to accept the agreements.
This was an INCREDIBLY dirty practice and why have such animosity towards Best Buy.
The last time I forced customers to setup with this was a memorable occasion. A semi-intelligent customer realizes I had just set him up with something that he did not want. I confused him by rushing him through the process, what I was shown and instructed to do. After the transaction was over, he saw the agreement on the receipt and was furious. He requested a manager, which I went and got. As I explained the situation to the manager, they were like 'oh crap' and then told me what I'm about to do I have to do infront of the customer but no this is just a front for the customer. The manager gets to the GeekSquad area, the customer explains the situation, the manager begins to apologize and blame the entire thing on me and not being experience, ignorant, etc. So basically the customer thought I was an idiot and I tried to screw him over. So the company saved face on my expense. After the customer left, the manager apologized again for what he had to do, but it couldn't be revealed this was actually what we were supposed to do. From that point forward, I never pressured anybody into any contracts and management did not like that. However, they let it slide because I would explain what had happened before and my sales were so strong on everything else, they couldn't really fault me. I received the store MVP award for approximately 2 years straight (every month, every quarter).
So yea, fook best buy and their dirty as practices. It's never corporate, but the managers that don't meant their goals will likely be fired within a few months. So stores do everything they can to keep their management employed. Fooked up system right? Oh and did I tell you that the stores compete against each other on goals, so half of the company is always in the dog house. Half of the management is always on alert that they could be fired or replaced shortly. They pull out all the tricks to stay in the top half.
The customer actually signs up for the service, starting after the "free" trial period ends. The problem is that they don't give the customer time to read through the small print before they sign, nor explain that this will happen. "You need to sign here, here, and down here. You need help carrying that to the car?"
No it doesn't. The quote from him is very clear that he thinks that following Supreme Court precedents requires him to reach the conclusion that the claim can be pursued under RICO. So that's his ruling; the claim can be pursued under RICO, concurring with the others. He and one other judge just wanted to make it absolutely clear that they think this is fucked up. They're allowed to do that.
RICO was originally designed to deal with organized crime ala the Mafia. The problem is it has many times been abused to attack corporations who run afoul of the law. Many companies are completely unprepared for the realities of RICO because it's not something that would normally apply to them. RICO had a noble purpose, but the language of it is so broad, and supported by SCOTUS, that it's a danger to any company.
Here's a quick example. Let's suppose a small conservative town in Texas decides that something like FHM magazine is "obscene" and inappropriate for kids. They pass an ordinance saying so. The next day, the cops come in and close down a local 7-11 for selling FHM, takes 'em to court, and they're found guilty. Southland Corporation decides not to fight on free speech grounds and pays the fine or whatever. They make sure not to sell the magazine in that town anymore. Remember, SCOTUS says obscenity is defined by local community standards, so this is entirely legal.
Then a small town in, say, Oklahoma does the same thing to another 7-11. Ding! RICO kicks in. Suddenly, Southland is engaged in a racketeering pattern of behavior. The fact that the two violations were unintnetional or unrelated doesn't matter. Okay, so what's the big deal? The big deal is that under RICO, the entire assets of the Southland corporation can be seized. And sold. BEFORE TRIAL. WITHOUT ANY RECOURSE. Every 7-11 in America can literally cease operation overnight because two small towns in Bumfuck, Nowhere decided they didn't like a particular magazine. The only other alternative is that 7-11 would have to stop selling the magazine everywhere, because it can't take the risk of having a second violation that would qualify for RICO.
Anyone who thinks the PATRIOT ACT goes too far should really be far more worried about RICO. It can do far greater damage. There are parts of RICO that are probably a good thing; it certainly makes it easier to take down criminal organizations. But the law needs to be changed if we are going to preserve our freedoms.
I worked in a call center that did support for MSNIA. That was horrible in itself, but I had to deal with people who had anywhere from 2-8 extra accounts that were created each time they went to best buy. Some of the people didn't even have a computer! In one case an elderly lady bought a microwave, which didn't work, then returned for a new one and ended up with 2 dial-up accounts... which she didn't notice for a year! Now that last part is her fault, but I arranged for a full refund because I hate microsoft and their scummy ways.
One, they didn't rape anyone, just made them do humiliating things.
... humiliating".
Rape has been alleged, and given the other things carried out it doesn't seem too far fetched. Sodomy and torture (including torturing to death) is documented.
Whilst being sodomized or hung from your wrists (behind your back - strappado) until dead almost certainly do qualify as "humiliating things", I don't think many people would regard them as "_just_
Three, guess you don't like muslim/arab punishments?
Not really, although I note that sharia law seems to typically specify a trial first...
Six months later MSN billed my card. I called MSN and asked what was going on, they told me that I'd signed up through Best Buy. I said "Oh no I didn't". They canceled the membership and refunded my money.
Lawsuits going all the way to the supreme court? Sounds like some lawyers getting richer.