Did you know that every time you purchase something from Overstock.com you agree to a mandatory binding arbitration clause and have no legal recourse against the company? Even if they illegally disclose too much of your information on your receipt?
From the Madison County Record:
Shandie Deaton filed the suit Sept. 18, 2007, one month after she made a purchase on Overstock.com. She alleged her receipt violated FCRA.
The act was passed in 2003 and provides that anyone accepting credit or debit cards may not print more than the last five digits of the card number or the expiration date upon any receipt provided to the cardholder at the point of sale or transaction.
Credit card machines put into use after Jan. 1, 2005, required immediate compliance with FCRA. Machines in use before Jan. 1, 2005, were required to be in compliance by Dec. 4, 2006.
Deaton claimed Overstock.com violated FCRA by printing the expiration date and/or printed more than the last five digits of class members’ credit card or debit card numbers on the receipts provided at the point of a sale or transaction between Overstock.com and the class members.
“Overstock.com’ violations were not the product of an accident or an isolated oversight,” the complaint stated. “Rather, Overstock.com knowingly and intentionally continued to use Devices which were not programmed to, or otherwise did not, comply…”
The lawsuit asked for monetary relief of no less than $100 and no more than $1,000 for each violation. Overstock filed a motion to dismiss, claiming that its customers agreed to mandatory binding arbitration by purchasing something from their website.
According to Overstock, customers can freely access their website, however when placing an order, they must agree to the website’s terms and conditions before they can continue.
“Any dispute relating in any way to your visit to the Site or to products you purchase through the Site shall be submitted to confidential arbitration in Salt Lake City, Utah,” a portion of Overstock’s terms and conditions reads.
“To the fullest extent permitted by applicable law, no Arbitration under this agreement shall be joined to an arbitration involving any other party subject to this Agreement, whether through class arbitration proceedings or otherwise.”
The judge ruled in favor of Overstock and dismissed the case. “Accordingly, the Court cannot conclude that arbitration of this action is prohibitively expensive,” Gilbert wrote. “Therefore, the Court will not invalidate the mandatory arbitration clause based on the theory that forcing Deaton to submit to arbitration would prevent her from vindicating her rights.”
We took a look at this arbitration clause and noticed that there’s an exception to it. If you even “threaten” to violate Overstock.com’s intellectual property rights, they reserve the right to haul you into state or federal court in the state of Utah. What a piece of work.
Arbitration, not litigation: Judge dismisses federal class action v. Overstock.com [Madison County Record] (Thanks, Shelley!)
Overstock.com Terms & Conditions
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Oh and sorry that was so long.
@sjulaw: While I am a fan of ADR, it isn’t particularly good for everyone all the time. Similar to litigation, it has its uses. Realize though contracts are a form of demanding what you want and negotiating to that goal. Your perspective becomes naive if people cannot effectively negotiate. The contract will simply become a one-sided negotiation and by definition that is only good for one side.
@masonreloaded:
Actually, in the US, for a contract to be legally binding, it cannot violate established law.
My guess is that in this case, since the suit that was filed against Overstock.com was a civil suit and not a criminal case, the arbitration clause (which is still considered legal for reasons I can’t fathom… you’re not supposed to be able to sign away your Constitutional rights) was upheld.
If the consumer in question were able to prod the appropriate attorney general into action, the company wouldn’t be able to hide behind the arbitration clause.
Madatory binding arbitration=broken
Let me clarify what I said by saying that Overstock.com’s violation is unrelated to the contract the consumer agreed to, and that combined with the fact that the consumer’s suit is a civil suit seeking monetary damages is why the arbitration clause is being upheld.
Overstock.com needs to face criminal charges for the violation.
@sjulaw: It’s not a matter of pissing people off, it’s a matter of them not being honest and transparent in their business practices. MBA is OUT OF CONTROL. I was just forced to sign an arbitration agreement with my employer or find myself unemployed. I’m not saying there aren’t exceptions, but I will exercise my right not to shop at companies that force it on me, and reward those that don’t. Accepting it as “just the way it is” is what got us here in the first place. Even the EEOC has issued a position statement strongly disapproving and discouraging MBA.
@WraithSama:
Exactly. It is a question of jurisdiction and the jurisdiction of arbitration is limited.
Upon rereading the actual article, it seems like her attorney didn’t read the law. But then I don’t know the facts so maybe that was the best he could come up with. It seemed like he challenged the law on things that were previously settled rather than going for the (easier) contract analysis approach.
@curiosity: And yes I was saying that BASED ON THE REASONS THE PLAINTIFF CLAIMED the Judge was right. The plaintiff could have won on other reasons.
Producing car batteries glorifies God because:
A) Those neon/LED crosses on truck cabs don’t light themselves
B) God clearly loves chemistry; that’s what the first days of creation are all about… or maybe just play dough (Genesis, right? I dunno much about the Bible because I rarely read fiction ZING I’ll be here all night, folks)
@curiosity: Correct me if I’m wrong but I think the point people have to keep in mind is that judges cannot start doing the jobs of the legal counsel hired by the two parties. That is, if the plaintiff says “the clause should be voided because A” and he is unable to argue “A” to win the case, then it does not matter whether there are reasons B, C or D that could void the clause. Unless those are part of the plaintiff’s argument, the judge is not going on his own to bring those reasons to the table just for the benefit of the plaintiff.
@lemur: You are right. A judge has to rule on what is presented (generally). It is a bit different if the complaint asserted the right thing for the wrong reasons and the judge found the right reasons in the trial (weight of the evidence), but it seems to me here that the plaintiff did not even present the relevant evidence. Of course that is the ideal rule – not to say that you can’t find cases where the judge finds whatever he wants to find irrespective of the evidence.
Vote with your wallet. Never shop there again.
@DallasDMD: I think the problem is that they are (ab)using religion to sell batteries.
This judge is set for life now.
Arbitration companies will be throwing money at him if he cares to join them now.
@mgyqmb: Don’t forget Forever 21 (“John 3:16″ on the bottom of the bags) and Bess Eaton (Bible verses on the cups).
Well, not so much Bess Eaton any more, as they went tits-up, and Tim Horton’s bought ‘em out, which I wholeheartedly approve of.
@DallasDMD: Would you shop somewhere that mentioned ‘serving Satan’ in their fine print/mission statement/etc.?? Same thing, just opposite direction.
And you’re trying to grab that little market share because your product is no better or worse than someone else’s, but buy this because Jesus would put one in his SUV.
I like God, but not the shit people do in his name.
This is BS. I will not shop at overstock again. ever.