Seriously this is getting out of hand.

So if I write a contract that says I can do something illegal to you, then include a mandatory binding arbitration clause, I can't get in trouble for it because there's no one available to bring civil action against me? Awesome!

I was unaware that companies could actually use arbitration to dodge flagrant violations of the law. Couldn't this consumer have the government take legal action against Overstock? Seems to be the government could at least prosecute them and fine them, even if the money wouldn't be going back to the consumers in that case.

Well, looks like I won't be shopping there anymore.

Vote with you wallets, folks.

Oops, you = your.

@Jaysyn: I agree seeing a company do this makes me avoid them like the plague.

It certainly seems bizarre that someone can clearly break the law and the court can't do anything about it. I know at least in the UK there is nearly always a clause on such terms/agreements saying: This does not affect your statutory rights. (Meaning a contract cannot override the law.)

If one reads the article, you can see that the person who filed the lawsuit tried to show that arbitration would cost too much, and did not provide evidence to back it up.

Ultimately I disagree, though. I'm pretty sure arbitration clauses can't invalidate the law.

Wouldn't this put an arbitrator in an awkward position? I mean, Overstock.com seems to have clearly violated the law in a manner which can be easily documented. I'm sure there is legal precedent in how to deal with such violations, too. So, how do you screw the customer on behalf of your employer. Certainly would need some creativity.

Actually, the might not need to. I assume you can't "Class Action" arbitration claims. If they force everyone to go one by one, they can pay out on each but still pay only a fraction of what they would in a class action since only informed and persistent customers will file.

The O: Obtuse, Over-legalesed, and Out of my bookmarks.

@Jaysyn: Agreed.

@courtarro: The contract wasn't illegal, overstock's actions were. The contract simply precluded the company from being sued in court over the illegal actions.

You cannot contract for illegal acts. Generally that will void the contract (though sometimes only the illegal section will be thrown out).

so basically, i could walk up to someone, punch them in the face and take their wallet, hand them a document claiming 'binding arbitration' and they couldn't do a damn thing about it?

It seems to me that the aribitration clause would only apply to civil suits - no lawsuits, class action or otherwise. The feds should still be able to press charges for violating FCRA.

isn't this a civil lawsuit though? If so, the arbitration clause is clearly allowed for the civil component of breaking the law.

I seriously doubt this decision would keep the Feds/whoever from bring the company up on criminal charages, since they very clearly broke the law.

same with Dell.com MBAA in it too.

I ask again, can we get micro-print on the backs of our checks to the effect 'any entity cashing this check withdraws all mandatory arbitration clauses from its contract with checkwriter'????

As a credit card merchant, I received multiple notifications of this requirement from Visa/MC and AMEX and in their notice Visa said they would fine any merchants not in compliance. Any merchant that makes Visa mad can be charged very large fines.

@ksf4: I don't know the legalities, but I think this is complicated by the fact that the penalties for violating the FCRA are that consumers may seek civil liabilities up to $1000. I'm not sure if it's a criminal violation on Overstock's part.

@Braindesign: Not quite. To invoke the "binding arbitration" clause, one must first have business dealings with the company. In your case, you are thrusting the "binding arbitration" document upon them without any prior consent. In addition to being charged with theft, if you didn't pick your victim carefully, you might end up with a binding document shoved up your arbitration as well.

the use of binding arbitration is just overboard

i would imagine that most people that go on overstock don't scroll all the way to the bottom of their main page to see the

"By using this site, you agree to abide by our Site User Terms and Conditions."

most people are just going to start looking at products
and not search for a use and conditions notice

that's bullshit

Overstock.com = wankers

They won't ever be getting a dime of my money.

I didn't know people actually shopped there. I mean besides the annoying sexual double entente in their commercials, they're a heavily Mormon-owned company. Pretty much the same reason I don't buy Interstate batteries (read their mission statement) or eat at Chick-Fil-A (ever wonder why they're closed on Sundays?).

I hate Overstock.com. Some of their stuff is trashy and not really a bargain -- you can do better at local brick/mortar store sales.

I would file a complaint with Visa/Mastercard. I'm a merchant, too, and they know or should have known about this law. I know I have gotten lots of stuff from my merchant services provider about this. Let them go into manditory binding arbitration against Visa to get their merchant services back.

I think the judge is wrong on this. Had this been a contract dispute, the judge would have been right. This is a violation of a civil statutue and should be outside this "manditory binding arbitration".

Overstock.com can just stay over-stocked as far as I'm concerned.

@chartrule: Looks like it's time we start looking at that sort of thing. I didn't see anything like this on Amazon for instance.

@ShortBus: I can respect the Chick-Fil-A reason for closing on Sundays. At least they aren't doing it to screw customers over.

@Jaysyn: Bravo! We (the consumer) have all the power in the world over them, so let's use it.

Never. Shopping. There. Again.

Heres a question. How illegal of an act can you commit against someone with arbitration before the cort nullifies it? I know the whole haliburton case thing, but does this only work with civil, not criminal acts?

@ShortBus: Just what are they doing on Sunday that I need to be worried about?

@sacrabos: As a merchant, could you tell me the details of how this kind of thing applies? In particular, my concern is that many restaurants I go to print the full credit card number on the receipt that I sign and they keep.

Is the violation mentioned in this article only a violation because the receipt was sent in the mail, or because the receipt with the full number was given to the consumer, or what? Personally, I'd much rather have the receipt with my full card number in my hands than in the waiter's or busboy's.

@noquarter: The copy they keep can have all the numbers on it. How else can they make sure they charge you if the card reader goes down or if the system didn't keep your order? Think of those manual card swipers.

@cde: I don't know how they do it, but most places don't give the full number on the receipt that they keep, so they must be able to handle it somehow.

Yep vote with your wallets. But there might be another way.

I have read a few binding arbitration agreements. What I find interesting is many will state a place. Few if any state who pays and who selects the 'judge'. It is just assumed that the company is providing that. What if somebody submitted to arbitration, provided their own judge? The company will refuse of course which is the point.

You then take that argument to a real judge as you can't arbitrate arbitration. When the real judge throws out the arbitration for ambiguity on this point then the case goes to a real court.

Well, guess I will no longer shop there either. I did get a pretty sick Bulova watch there like 5 months ago, now I want to go dig out my receipt.

@cde: I'm pretty sure NOQUARTER is talking about a receipt that is printed after they are charged. If anything, I would like to know when the last time was that you even saw one of those manual card swipers with your own eyes was. Even the mom-and-pop stores I visit have electronic card readers, and those readers put the charge through instantaneously.

@noquarter: If they are charging your CC when they give you the receipt, that is the point-of-sale. The restaurant is violating the law if they give you that receipt with your full CC number on it. However, if you pay for your tip with your CC, they have to charge you a second time somehow.

IMHO, if you have to pay a tip you should always pay cash for the entire transaction.

That's disappointing. I like Overstock, but I guess I won't be shopping there anymore.

@courtarro:
Actually the contract wouldn't be binding for reasons of public policy.

@ShortBus:

To glorify God as we supply our customers worldwide with top quality, value-priced batteries, related electrical power-source products, and distribution services. Further, our mission is to provide our partners and Interstate Batteries System of America, Inc. (IBSA) with opportunities which are profitable, rewarding and growth-oriented.

You learn something new everyday, don't you? I'm going to add this to my list of companies I will not patronize, along with Chik Fil A, and now Overstock.com. Religion drives me nuts.

@mgyqmb: But atheistic businessmen who worship money above culture doesn't?

I'm no fan of Christianity but your reasoning escapes me.

Nah, the judge was right in this case. Just ordering something from the site is enough to bind the consumer to arbitration under the terms in the agreement unless they impose an absolutely ridiculous burden on the consumer. Those people saying they'll never shop at this site again should probably realize that most large merchants have an arbitration clause somewhere and refusing to shop at such places would be more of a hassle than its worth in all likelihood. Plus, not that I don't think these sort of agreements are unconscionable, arbitration doesn't mean that one party gets to judge the case and you have no rights whatsoever. There's a federal body of law governing arbitral proceedings. The panel MUST be ultimately neutral, you can ask for a written, reasoned opinion by the arbitrators, and if you inform the arbitrators of the current law, and they disregard it, and you can show they disregarded it in order to rule against you, you can have the award tossed in review in federal court. Also, you must have an opportunity to present your case to its full extent. In some cases arbitration is actually better for everyone. It's usually quicker and cheaper, and since arbitrators can do equity, you might wind up with a bigger award than you would have gotten in fed court. The thing that sucks is that most people don't know they're consenting to it and the idea that the judicial system option is not available (or you can try it but the judge will have to stay pending arbitration) and this waiver of a right without realizing it pisses people off. Rightly. But if you're buying something from a large retailer, and in the case of many small ones as well, you're probably submitting to arbitration. It's just the way it is.

[www.law.cornell.edu]

@DallasDMD: It has nothing to do with the business side of things. I simply make a choice to not patronize establishments who feel as though they are doing "the lord's work".

It's kind of like not going to businesses that endorse a different political party from your own. It may seem trivial and juvenile, but I enjoy exercising my inherent freedom from religion in every part of my life.

@mgyqmb: But they don't exclude you for not being religious. What if I feel I am upholding some sort of transcendental or supernatural concept when I am doing business? You're not making a whole lot of sense.

If you don't like Christians, just say so.