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New eBay EULA Prohibits Class Action Lawsuits
First time accepted submitter dangthill writes "On August 21, eBay updated its end-user agreement by adding a binding arbritration clause. By accepting the new agreement, users forfeit their right to join class action lawsuits and instead must submit to arbitration. However, users may opt-out by mailing eBay a signed notice. eBay joins Microsoft, Sony, Electronic Arts, Valve and other companies attempting to prevent class actions after the Supreme Court of the United States ruled such tactics valid."
Does anybody else remember when kangaroo courts were something we associated with the commies?
Doesn't like every other EULA out there do this as well?
I imagine it's already appearing on many more transitory agreements. Corporations now have an out, thanks to Scalia and his buddies, that protects them from the possibility that they'll ever get hit with a lawsuit big enough to actually threaten them. It puts each and every person that they fuck over out on their own and arbitration biases everything in their favor.
I await the inclusion of anti-class action language in virtually all individual-facing contracts. It's virtually guaranteed to happen as there's no downside whatsoever for the corporations.
You might be right about only the lawyers winning but the consumer has already lost if it gets to class action. In a system with forced arbitration the Corporation never loses and never has an incentive to fix a problem, at least with a class-action suit the corporation stands some small chance of losing and may attempt to fix the problem.
Yes, because punishing a company for business practices that provoked 1,000,000 people to require legal recourse is something we never want to do. Also, I don't know which is worse, your spelling or the fact that you pay $50/person for lunch.
Everything is better with chainsaws.
Yes, but part of the point is the scummy company loses. Sometimes tort law isn't about recouping losses, but preventing unethical behavior in the first place. Frequently the classes of wronged people don't suffer much, but LOTS of people suffer. To me, it seems like a valid course for redress of grievances, and you shouldn't be legally allowed to sign away your rights.
Here is the situation for Germans:
As long as you are a CONSUMER, i.e. a private buyer or seller, that clause is invalid, since law requires such an arbritration clause to be settled in an entirely separate contract, and to be signed in person OR digitally as defined in BGB and SigG (there is almost no way to satisfy those requirements for a company like ebay or Valve at the moment).
If you are a COMMERCIAL seller (indication: you must accept returns), then the clause is indeed binding.
There is NO customer protection AT ALL in EU regulations in that regard.
The situation WILL differ depending on your country.
the big problem is since the arbitration company is paid for by the company they will automatically be biased in favor of KEEPING THE CONTRACT.
so yes you could in theory sue over the arbitration not being fair but you agreed that the arbitration was BINDING.
Any person using FTFY or editing my postings agrees to a US$50.00 charge
If you get $100 bucks you're lucky, my impression is that most are much lower. But as far as I understand, that's sort of the point of class action. Each person hasn't been harmed much and doesn't deserve a huge award, but if the company scams 1000000 people for $100 each they make a cool $100 million so the point is to punish the corporation. The problems are twofold:
1) The class action lawyers don't act in their clients' best interest. They want to rack up as huge a legal bill as they possibly can, knowing each client is again too small to complain about it since s/he's 1/1000000th of their case. Either by spending time in court or more commonly by settling in a way that's favorable to the lawyers and unfavorable to everyone else. Class actions should be done on commission, if you want to get paid more you have to settle for more. That'd put the incentive back in the right place trying to extract as much money as possible for your clients.
2) Extremely often the settlement doesn't actually involve cash, in involves a voucher or a discount for your next purchase even if you don't ever want to do business with them again. Not to mention people often never get around to spending them because they can't find anything they want to buy - even with the discount and it is forgotten or lost. Particularly for software the value is simply the sales value, it costs them nothing to churn out more copies. This could also be solved by requiring the payout be in cold hard cash.
Live today, because you never know what tomorrow brings
In August 2002, Craig Comb and two others filed a class action against PayPal in, Craig Comb, et al. v. PayPal, Inc.. They sued, alleging illegal misappropriation of customer accounts and detailed ghastly customer service experiences. Allegations included freezing deposited funds for up to 180 days until disputes were resolved by PayPal, and forcing customers to arbitrate their disputes under the American Arbitration Association's guidelines (a costly procedure). The court ruled against PayPal, stating that "the User Agreement and arbitration clause are substantively unconscionable under California law," noting their unjustifiable one-sidedness and explicit prohibition of class actions produces results that "shock the conscience" and indicate PayPal was "attempting to insulate itself contractually from any meaningful challenge to its alleged practices"
is a freaking fat joke.
Not quite - jokes are funny.
This sort of shit is anything but.
An enigma, wrapped in a riddle, shrouded in bacon and cheese
This is a subject on which I have experience. I am an arbitrator. I occasionally am asked to decide consumer cases, but that is not my primary area. I have nothing to do with ebay arbitrations. I know a good bit about the American Arbitration Association.
The issues here are not simple, and there are rational arguments both ways. I'll leave PayPal out of this discussion, since they may be a different case. But, I think there are good things about arbitration from the consumer's end of things.
First, arbitration as structured under the ebay user agreement is straight up, no funny business. The arbitration process is administered by the American Arbitration Association, which is pretty widely respected as being thoughtful and above-board in their management of the arbitration process. AAA does a good job of training arbitrators. AAA does not direct or control the outcome. Think of them as the clerks office at the courthouse. They manage the process, keep records, recruit and train arbitrators, but do not get involved in deciding the case.
Keep in mind that an ebay transactions are likely to be small. A few dollars to a few hundred dollars. I'd guess that larger transactions are less common. How likely are you to hire a lawyer to file suit against eBay over their mishandling of a few hundred dollars? Would you really want to travel across the country for a day long trial over a $500 claim? Over a $100 claim?
By providing for disputes to be resolved by arbitration the following happens:
- The parties have a direct say in choosing the arbitrator. You can ding anyone on the list that you don't like the looks of.
- The proceedings are informal and expedited. This reduces the cost of getting to trial, a trade-off which seems appropriate to me for a case of modest size.
- The final hearing (i.e. the trial) takes place by telephone or is decided by written submissions. Again, would it be worth it to fly across the country to a trial over $500?
AAA does not decide the case. The arbitrator decides the case. This distinction is important. Most arbitrators are experienced, and widely respected, lawyers who have a practice focused on the area of the law in which they hear cases. Many arbitrators are practicing lawyers, who do a small number of arbitrations. Some arbitrators are full time neutrals. An arbitrator obtains future work as an arbitrator only being acceptable to BOTH sides of a case. In my experience lawyers talk to each other. An arbitrator who gets a reputation for making bone-headed decisions on a case will quickly find him/herself out of work. An arbitrator who gets a reputation for being the pawn of one side or the other is done, end of career as an arbitrator. Similarly, an arbitrator who simply "splits the baby" and not really making the hard call of who wins/who loses under the law is also likely to find that he/she has not future assignments as an arbitrator. It is not unusual for me to be selected to serve as an arbitrator by a lawfirm where I have previously ruled against one of their clients in an earlier case.
Yes arbitration does not provide the exact same trial process as a jury trial at the courthouse. But very few cases filed at the courthouse go to trial. Say, 5% or so. My experience in arbitration cases is that the vast majority of consumer arbitration cases do get to trial. There is genuine concern that we have created a litigation process so expensive that almost no one can afford it. Consumer arbitration under the AAA rules provides a way to get a small claim heard quickly, and at modest cost. I think this has real value.
Some will say that the restriction of class actions means that big companies are free to lie, cheat and steal. I've seen a big company facing scores of consumer arbitration cases under rules very similar to those set by ebay. The company's cost of trying those cases is much higher than it would be under a class action. Plus, under a class action one trial and you are done with every one. In this process, the company has to try or set
I had this problem too after many years of buying junk on ebay, unfortunately many otherwise good sellers will only take paypal :(
Solved by:
-Call bank, create new checking account
-(optional) create short name/nickname for account for use on website/apps/etc. (suggestions: "I hate paypal" or "paypal sucks" or "***** paypal")
-Ensure this account is not linked to any other account in any other way at all. No overdraft, no protection, no nuttin'. Triple verify this with your bank, many will "helpfully" set these up by default.
-transfer $25 or whatever minimum is to account
-continue to use credit card on every purchase (paypal will use 5000 different website tricks to make sure this is not your default method, so you have to select it every time, annoying as hell but whatever)
-$profit$ by not risking more than $25 to their crappy crooked methods
The bank employee that did this for me over the phone was not surprised at all, they had done similar for people several times before.