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Amazon Payment Adds "No Class Action" Language To Terms of Service
wbr1 writes "I just received an email from Amazon Payments, the Amazon competitor to PayPal, stating among other things, that they were changing and simplifying their policies. It should be no surprise then, that similar to what PayPal and many others have already done, they have added language removing the right to class action lawsuits. See specifically section 11.3 (edited for brevity): '1.3 Disputes. Any dispute or claim relating in any way to your visit to the Site or Seller Central or to products or services sold or distributed by us or through the Site or Seller Central (including without limitation the Service) will be resolved by binding arbitration, rather than in court, except that you may assert claims in small claims court if your claims qualify. The Federal Arbitration Act and federal arbitration law apply to this agreement... ... You and we each agree that any dispute resolution proceedings will be conducted only on an individual basis and not in a class, consolidated, or representative action. If for any reason a claim proceeds in court rather than in arbitration you and we each waive any right to a jury trial. You and we also both agree that you or we may bring suit in court to enjoin infringement or other misuse of intellectual property rights.' This is becoming more and more common, and while the end user normally doesn't make out well in a class-action suit, large settlements do provide a punishment and deterrent to corporations that abuse their power. The question becomes, what do we do to fix this so that consumers are truly protected?"
That would make them unenforceable. I'd actually say we need to make the people who suggest such options to be prosecuted as attempting to corrupt the influence and sanctity of the courts, but I doubt that'll happen.
Heck, if the Constitution didn't make it a legal right, they'd probably try to remove that access. Yet another example of how the Constitution needs a bit of rewriting to deal with the problems of the day.
Not that we'll ever stop every attempt to weasel around it, but we can try to smack down a few.
Also the first person who mentions Stella Liebeck can suck it.
I've received several class action post-cards or emails over the past several years. They always go in the trash (real or virtual). Most of them are for some imagined offense that a company has committed, and amount to little more than a shakedown by some law firm trying to make a quick buck. I'm sure there are legitimate class actions, I've just never seen any that have benefitted me.
Taking guns away from the 99% gives the 1% 100% of the power.
Accepting credit cards is difficult. Accepting Paypal (or Amazon payments) is very easy.
Before everyone jumps to conclusions,
Class action lawsuits are nice for the law firms that pursue them, but rarely do much for the people that are part of the class.
I've been involved in several in my life and never saw more than a few bucks.
As a matter of fact, you usually have to specifically ask to be REMOVED from the class or be assumed to be a part of it. Kind of like being automatically opted-in instead of automatically being opted-out. And after you are opted-in, you lose any right to sue them on your own.
The question becomes, what do we do to fix this so that consumers are truly protected?"
Congresss needs to step in and clarify. Either just git rid of the class action (and replace it with what?) or confirm that all consumers have a class action right, no matter the language of the contract.
Even more far out, would be arbitration reform. Instead of arbitrators being hired by the companies that have a stake in the outcome, make the companies pay into a pool for each instance of arbitration they are called to. The arbitrator for a specific dispute would be pulled randomly from a pool of trained arbitrators. The could be industry specific pools, or just train the arbitrators in contract law. Of course if I were such an arbitrator, I'd throw out any contract over N pages. (Unless both parties had actual input into the contract)
All ideas^H^H^H^H^Hprocesses in this post are Patent Pending. (as well as the process of patenting all postings)
Congress never intended pre-dispute binding arbitration clauses to apply to consumer contracts under the FAA but business-friendly courts have interpreted the law that way. Congress just needs to amend the FAA so that pre-dispute binding arbitration is not binding in consumer contracts, as well as prohibiting the requirement that consumers waive their right to class-action and jury trial pre-dispute.
It would also help if Congress gave the CFPA or some other pro-consumer leaning agency oversight of private arbitration companies because right now they have a massive conflict of interest since their customers are the big businesses that count on them ruling in their favor more often than courts would in consumer cases.
Without class actions, how can a company be punished for, for example, cheating a million people out of $10 each?
I suppose that the government could step in, but a class action has the advantage of providing a market-based solution to the problem. A greedy law firm can determine that the payoff will be profitable, and then invest their own resources to punish the offender. The fear of being on the receiving end of a suit helps keep big corporations in line, and this explains why they hate them so much.
Since there is no way congress is going to fix this when lobbied by the public we need to amend our political system in the following ways: : 1.) Stipulate that use of public airwaves by a licensed television station requires that the licensee provide access to the public airwaves for a reasonable amount of time. In this way we can provide access for advertising to public officials without requiring legislatures to sell their soul to gain access to what is basically a public right of way. 2) Make it illegal for congressman to be lobbied by people who are not from their district and they do not represent. Providing dinners / gifts by corporations or individuals to congressmen by people they do not represent should be the new definition of bribery. 3) Eliminate the integration of republican and democratic parties into the local election system. For example, the public voting machines and facilities should not be provided to private political organization. This should MOST DEFINITELY not be done for free. I am done with the republcian and democrat organizations wasting millions of taxpayer dollars for their own private ends. In this way, primaries need to be revised. Most explicitly, party allegiance should not be a factor for qualification for running in a primary election. This system disenfranchises independent voters. Maybe a few years after these things have been done we will have a congress that will pass laws that are for the benefit of the people, and they might just pass a law providing for the protection of consumers.
Local stores are rarely price competitive...
Amazon, Wal-Mart, and folks like them are only "competitive" because they eat babies and rape third-world teenaged mothers.
If you want news from today, you have to come back tomorrow.
But they do nothing for the consumer. It's a market solution that benefits lawyers and encourages them to pursue frivolous class actions.
They pay-out to the consumer is a $3 off coupon and a pat on the back.
There should be financial punishments for corporations who harm vast swaths of consumers, but I'm not sure class action lawsuits were the solution.
Most sellers on eBay do not take credit cards. They are not horrible in my experience. Charges are too high, but if you need oddball stuff on eBay, you are practically required to use it. If bank-to-bank transfers were as cheap in the US as they are in Germany, PayPal would be out of luck. Also, if you are in the US and try to buy something from eBay Germany, it is difficult to pay unless the seller uses PayPal.
Sorry, but gray text on gray background is making my eyes bleed.
Maybe I'm missing something, since I've never had to go through arbitration (or small claims court). But couldn't a lawyer/firm put together a kit to show you what you needed to do to take these cases to small claims court, or even requesting arbitration? Do companies have a time limit for arbitration? I could only imagine if a law firm did a "class" action style sign up for these kits, and charged people a small amount of money for it (generic kit, couple hours, sell it for like $10 even) that it would cost these companies a large sum of money to respond to all of them.
Whether a binding arbitration clause is valid depends on the province's consumer protection laws.
No-class-action clauses have been found invalid in BC and Ontario, in the cases Seidel v. Telus Communications and Griffin v. Dell Canada respectively.
I don't believe there have been cases on this regarding any other provinces' laws.
upon the advice of my lawyer, i have no sig at this time
As others have pointed out the main benficiaries of class action law suits are the lawyers -- who make a lot of money out of them. Many law makers (Parliament/Senate/Congress/...) were lawyers when younger and will remain good friends with those who are still lawyers.They are not going to see their old profession or friends suffer: they will pass legislation to stop these sorts of clauses.
Cynical ? Moi ?
Which will hold for only so long, corporations are going to be applying this to everything. Eventually you will be unable to buy from anywhere or use anything without being forced to give up your rights to the courts.
And it needs to be taken to court and struck down. Before people just accept it and move on.
---- Booth was a patriot ----
According to the Supreme Court in AT&T Mobility v. Concepcion, the term to ban class actions in a EULA or other non-negotiated agreement is actually valid. As such the term is getting added into every EULA during the re-writing process since the benefits are overwhelming (basically preventing a normal consumer from every suing you for fault since they could never recover enough to make it worth while) and the costs are nothing.
But they do nothing for the consumer.
Sure they do. The threat of a class action suit acts as a deterrent for potential abuse. Without the deterrent, corporations are more likely to try to engage in unethical or illegal behavior if they think it'll make them a buck.
--Jeremy
Jesus was a liberal
Normally if a contract contains something that is not legal, the whole contract can become void. So even if they put this in, how can this be legal?
If they put in their contract that they will now be the legal guardians of your children, that would not make it so. At least I hope.
Saying:Yeah, but you signed, does not make illegal contracts legal. I doubt it is possible to take away that kind of rights by signing a contract. I am using signing and not even 'clicking on ok'
Don't fight for your country, if your country does not fight for you.
(basically preventing a normal consumer from every suing you for fault since they could never recover enough to make it worth while)
In the UK, where there isn't really such a thing as a class action, what is done is that the plaintiffs get together, select a case, or a few cases which are good examples of the group and then everybody supports those people to sue. Once they win, the others can point to the first win as evidence in their own cases and so are pretty much guaranteed a cheap win. This means companies are almost forced to settle and certainly end up with huge costs if they don't.
Why doesn't the same thing work in the US?
=~ s,(.*),<sarcasm>$1</sarcasm>,g if any_point_you_wish();
It may be legal in the U.S, but I'm almost 100% certain it isn't in this part of the world (Denmark, and probably the rest of Scandinavia).
What if I do like the contract, but they break it? Then I go to court to resolve the matter. Oh, wait I can't, I have to go to arbitration, where the result is already determined against me.
If a contract isn't enforceable by law than it isn't a contract anymore. It is a bundle of official looking lies with no weight. Such a thing is unconscionable. It violates the very foundation of market based societies of law, and is tantamount to fraud.
Yet another example of how the Constitution needs a bit of rewriting to deal with the problems of the day.
You seriously want our current politicians... democrat or republican... to do a bit of "rewriting" of the constitution? You're fucking nutz.
So out of those 1M people cheated of $10, you expect 1% of them to take the time, effort, and money to sue the company for that $10 back? You do realize that even small claims court requires paying a filing fee (around $20-40) just to file, right? So even if you win, you've gained... $-10 or so. And you lose a day's worth of PTO.
A smart company would realize that and make sure the amount they cheat people out of is always going to be less than the filing fee. Sure there'll be a few who do so out of principle, but you can bet the numbers would be way less than 1%. And hell, you don't even have to do anything - just wait for the default judgement, pay up and cheat a few more people to pay for it all. Or just bill those people again and let them fight it all out again in small claims. Lose another half day of work and dollars.
And yes, the company just does... nothing. No expensive person has to show up in court (default judgement is fine). Cost to you - time and money, cost to the company - nothing - it's pure profit that they'll probably extract from you next month when you'll be too tired to keep fighting it.
Here's a great law review article written by Jean Sternlight of UNLV's Boyd School of Law discussing the impact of the recent case--AT&T Mobility, LLC v. Concepcion, 131 S. Ct. 1740 (2011)--that paved the way for companies like Paypal and Amazon to impose arbitral class action waivers in their consumer contracts.
As others may have pointed out, the most effective (and direct) remedial measure here would involve amendment by Congress of the Federal Arbitration Act. Partisanship and regulatory capture by big business may render this option unworkable for now. In that case, changing the composition of the high court justices, coupled with nationwide reports of the deleterious effects of the Concepcion decision, could allow for SCOTUS to agree to hear a similar case in which Concepcion's holding could be narrowed or abrogated.
For all of you non-lawyers who have not followed Supreme Court caselaw on arbitration, the fault lies with the Federal Arbitration Act. https://en.wikipedia.org/wiki/Federal_Arbitration_Act In short, the Supreme Court has repeatedly ruled that that Act has such a strong presumption for the validity of an arbitration clause that it is impossible to wiggle out of it. The next emerging threat is going to be binding arbitration in employment contracts. It already is inserted in many employment contracts, and the only protection at the moment is being offered by the NLRB. See, e.g., http://www.natlawreview.com/article/nlrb-throws-cold-water-mandatory-arbitration-provisions-prohibiting-class-actions-em
No longer true. I (among many) received payment exceeding $1,000 this year from a Honda class action lawsuit, in which air conditioner compressors died at astonishingly high rates.
No way, it's the other way around!
(basically preventing a normal consumer from every suing you for fault since they could never recover enough to make it worth while
You've never actually read one of these arbitration clauses, have you?
Here's PayPal's
https://cms.paypal.com/us/cgi-bin/?cmd=_render-content&content_ID=ua/upcoming_policies_full
We will pay the initial filing fee to commence arbitration and any arbitration hearing that you attend shall take place in the federal judicial district of your residence.
Here's Amazon's
http://www.amazon.com/gp/help/customer/display.html/?nodeId=508088
We will reimburse those fees for claims totaling less than $10,000 unless the arbitrator determines the claims are frivolous. Likewise, Amazon will not seek attorneys' fees and costs in arbitration unless the arbitrator determines the claims are frivolous. You may choose to have the arbitration conducted by telephone, based on written submissions, or in person in the county where you live or at another mutually agreed location.
In business contracts, the arbitration clause has been standard for years (decade+)... and it usually says something equivalent to: loser pays all arbitration costs and attorney's fees.
So if you have a legitimate claim, then you can file for arbitration, and the corporation will not only have to pay your claim, but all of the money you spent to bring the suit. This is more than you would get in court (where there is no "loser pays" clause).
(IANAL). The UK uses the English rule loser-pays costs system. Thus, if you're sure that you're going to win, you don't need to worry too much about attorneys' fees. If you have a case that will clearly result in a judgement of £10,000 and will cost £50,000 per side to litigate, then the defendant is going to end up out £110,000, and you'll end up getting £10,000.
The US, unlike almost every other country in the world, uses the American rule, where each party pays their own attorneys' fees regardless of outcome. Thus, if you have a case that will clearly result in a judgement of $10,000 and will cost $50,000 per side to litigate, the defendant will end up paying $60,000, but you'll end up losing $40,000. To make matters more difficult, this means that a defendant under threat of numerous small suits can intentionally make the litigation as expensive as possible for both sides: while it makes it more expensive for them, it makes it so that the plaintiffs will end up losing money on the case even if successful.
Small claims can help somewhat, as it doesn't allow attorneys, but even so, there are costs involved for the plaintiff. Thus, if a company cheats a few hundred thousand people out of $50 each, none of those people have any recourse in the courts that won't cost them much more than they'll gain.
That's not how tort law is meant to work though. The idea is that if there's a disagreement, you can get the legal system to settle things, and restore the injured party to where he should be.
If the behaviour is illegal then it shouldn't be up to private citizens to get justice when there's a justice system that's meant to do this.
but a quick search showed fo Credit Card companies, strangely, they had a 94% win rate.
[citation needed]
Here's an actual citation about consumer and employee win rates in arbitration:
http://overlawyered.com/2007/12/consumer-and-employee-win-rates-in-arbitration/
186 arbitration claims involving employment disputes in the securities industry. The data showed that employee claimants prevailed 46% of the time in arbitration compared to 34% in federal court. The median monetary award amount was slightly higher in arbitration, and the median time from filing to judgment was 16.5 months in arbitration compared to 25 months in litigation. ...
noted that employees prevailed over employers in 63% of employment arbitration cases filed with the American Arbitration Association between 1993 and 1995. To compare, only 14.9% of employees who brought cases to federal district court in 1994 prevailed in their litigation. The average duration of an arbitrated claim was 8.6 months, compared to 2.5 years in litigation. ...
California data shows that when consumers bring arbitration claims against businesses, the consumers prevail in 65.5% of cases that reach a decision. To compare, buyer plaintiffs litigating contract claims in the 75 largest American counties prevailed 61.5% of the time overall, and 60.9% of the time in cases decided by bench trials. When businesses bring arbitration claims against California consumers, the businesses prevail in 77.7% of cases that reach a decision. To compare, seller plaintiffs litigating contract cases in the largest 75 counties prevail 76.8% of the time overall and 78.9% of the time in cases decided by bench trial.
Real facts are so much more interesting than made up facts... don't you think?