Ina Steiner EcommerceBytes Blog
News and insight focusing on ecommerce.
by Ina Steiner, Editor of EcommerceBytes.com
Wed Aug 22 2012 23:13:10

Can eBay Prohibit Users from Filing Class Action Lawsuits?

By: Ina Steiner

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eBay updated its User Agreement and Privacy Policy this week, and sellers are taking issue with some of the new provisions, including one that attempts to prohibit users from participating in class action lawsuits.

eBay updated its User Agreement and Privacy Policy on August 21, which take effect on October 10, 2012 for current users. eBay is now requiring users to submit to arbitration when disputes between members and eBay arise, and it only allows users to pursue claims and seek relief on an individual basis.

Among the most controversial new provision that eBay highlighted in its announcement on Wednesday was the following:

"The User Agreement contains an Agreement to Arbitrate, which will, with limited exception, require you and eBay to submit claims to binding and final arbitration, unless you opt-out of the Agreement to Arbitrate by the deadline stated in the User Agreement. Unless you opt-out:  (1) you will only be permitted to pursue claims against eBay on an individual basis, not as part of any class or representative action or proceeding and (2) you will only be permitted to seek relief (including monetary, injunctive, and declaratory relief) on an individual basis."

Some sellers say they wonder if the provisions can be enforced.

Thursday's news story has more details, leave a comment to let us know what you think!

Note that the move on the part of corporations to ban class action lawsuits is part of a "trend," according to LA Times columnist David Lazarus, who said Microsoft actually spun it as a positive for consumers - read the column on the idahostatesman.com.

The move has the backing of the United States Supreme Court. The case, AT&T Mobility v. Concepcion, was covered by the SCOTUS blog last year, which has full coverage and resources to see where various parties weighed in on the case.

Update 10/5/12: See this EcommerceBytes news story for breaking developments.




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Readers Comments

Perminate Link for Can eBay Prohibit Users from Filing Class Action Lawsuits?   Can eBay Prohibit Users from Filing Class Action Lawsuits?

This user has validated their user name. by: Ric

Wed Aug 22 23:42:30 2012


The way I read it, users can opt out of the Agreement to Arbitrate without closing their eBay account....

" You can choose to reject this Agreement to Arbitrate ("opt-out") by mailing us a written opt-out notice ("Opt-Out Notice").  For new eBay users, the Opt-Out Notice must be postmarked no later than 30 days after the date you accept the User Agreement for the first time.   If you are already a current eBay user and previously accepted the User Agreement prior to the introduction of this Agreement to Arbitrate, the Opt-Out Notice must be postmarked no later than November 9, 2012 .  You must mail the Opt-Out Notice to eBay Inc., c/o National Registered Agents, Inc., 2778 W. Shady Bend Lane, Lehi, UT 84043. "  

Link: http://pages.ebay.com/help/policies/user-agreement.html#arbitrate
<
BR>(Don't
you love the mailing address?)

eBay no doubt has a special flag to place on the accounts of those who choose to opt out. Given eBay's reliance on algorithms to determine visibility in search, I would bet that an opt out notice would result in your listings being negatively impacted as a reward for protecting your rights.

Perminate Link for Can eBay Prohibit Users from Filing Class Action Lawsuits?   Can eBay Prohibit Users from Filing Class Action Lawsuits?

by: Theresa This user has validated their user name.

Wed Aug 22 23:54:48 2012

OMG, is this for real?  Is this just typical eBay arrogance or are they terrified that their lies, unethical and illegal actions will soon be brought to light (and a court of law)?  

Since I do not want to accept the arbitration terms in this agreement, I clicked the hyperlink in this sentence "If you choose not to accept the new terms, visit this help page for further direction".  When I saw that the link took me to the "Closing Your eBay Account" help page, I was initially stunned and then I just started to laugh.  I mean really, what else can you do when you're up against this crazy, inept, paranoid, arrogant, lying, thieving bunch of over-educated idiots?  

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by: MoonlitMemory This user has validated their user name.

Wed Aug 22 23:54:54 2012

Thank you for covering this.

Count me as one who is wondering “Why Utah?” EBay is based in California, has data centers in Arizona and Utah, and is incorporated in Delaware.

There has to be a reason they have cherry-picked Utah as the state whose laws their sellers will be governed by.

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by: trickstunt This user has validated their user name.

Thu Aug 23 00:59:59 2012

If they were comparable to abusive spouses before, they are child molesters now.

They must be bracing for something very bad to even dream of this.

I'd sure like to know what an attorney would have to say about this idiotic plan of theirs.

Thanks for the laff!


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by: alfabarn This user has validated their user name.

Thu Aug 23 05:49:34 2012

I think Banks where the first group to use this type of restriction. Legal challenges that claimed it is a violation of the consumers rights to due process where unsuccessful. The courts ruled that the consumer ''agreed'' to give up that right by remaining customers which implied consent. It is now part of my Mortgage contract. And probably yours. Did you get a fine print update you did not read?
I always viewed this action as an admission that the financial industry had been ignoring the rules. I have the same opinion regarding Ebay. The time to file a class action law suit would be NOW!! After all, sellers do have a right to due process. Until October 10th.

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by: alfabarn This user has validated their user name.

Thu Aug 23 06:02:45 2012

I wonder does this get worse. Are sellers prohibited from going outside this arbitration process for any reason. Not just a class action. At this time Ebay will remove feedback if you get a court order, but will this change prohibit a seller from taking such an action. I am interested in this aspect because I am taking a buyer to court. Will this change mean that Ebay has the final word even when it invloves Fraud and Libel? That is the system the banks put in place.
Is EBay making this official, Our way or the highway?

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by: go-figure This user has validated their user name.

Thu Aug 23 08:13:03 2012

When it comes to the moves that eBay makes these days, we're pretty much down to just laughing at them (nice corporate image zonBay--your company is a laughing stock!).

Take it for what you will, but in this case, I can't say that I blame eBay or any company for this move. In as much as we all pretty much despise zonBay these days, I personally despise lawyers even more. And the ONLY PARTY THAT WINS in class action lawsuits are the lawyers. Sure, the original ''instigator'' gets a small reward, but the attorneys on both sides of the aisle usually rack up millions of dollars in fees. The net result, minimal change in operating practices may occur, but costs go up and we all end up paying more. How many of you have received those notices in the mail or email notifying you that you are a member of some settlement group. Just do (or don't do) whatever it is that's specific to the CAL and they'll send you your $5 or $10 (or whatever ridiculously low settlement amount it is) until the fund runs out. All the while, the bottom-feeding lawyers are sailing off on their yachts and laughing all of the way to the bank!

Like it or not, it is zonBay's website and they are entitled to set the rules for its usage to pretty much anything they want as long as it does not require users to perform illegal acts. And in this case, while you may not like this move, you should at least be able to understand why they're doing it.

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This user has validated their user name. by: LDS Brother

Thu Aug 23 08:29:33 2012

Zonbay ?

I think you mean John Donahoe wants this to be EBAZON

EBAZON will never pass Amazon, so give it up on your EBAZON plans JD

Perminate Link for Can eBay Prohibit Users from Filing Class Action Lawsuits?   Can eBay Prohibit Users from Filing Class Action Lawsuits?

by: mickeyfinn This user has validated their user name.

Thu Aug 23 08:42:25 2012

What is the implication of such a clause in the User Agreement in respect of Statutory Rights?

... or is this part of the reason for choosing UTAH?

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This user has validated their user name. by: Nan
Web Site

Thu Aug 23 08:45:09 2012

So, who's going to be the arbitrator?

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by: E. Tomchin This user has validated their user name.

Thu Aug 23 08:53:52 2012

eBay and their cohort PayPal appear to be as self-destructive as the 1% who control the vast majority of the wealth.  There must be some form of mass hysteria going on among the rich and powerful to be so desirous of cutting their own throats.  I suspect eBay will only respond to one thing: The reduction of their bottom line (i.e., profits) and making the connection between that loss and the way they are treating the masses.  I can't see anything else having an effect on these power-mongers.  How about a one day boycott of eBay in the altogether just to highlight the power that the masses have if we band together.  

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This user has validated their user name. by: Philip Cohen
Web Site

Thu Aug 23 08:54:00 2012

"So, who's going to be the arbitrator?"

Probably the BBB—LOL

Perminate Link for Can eBay Prohibit Users from Filing Class Action Lawsuits?   Can eBay Prohibit Users from Filing Class Action Lawsuits?

by: innerpuppie This user has validated their user name.

Thu Aug 23 09:02:41 2012

I don't 'think' I'll be suing eBay. I don't 'think' that my privacy will be invaded by them (time will tell on this one), BUT I DO find it offensive, laughable, caustic, unprofessional, presumptive and all around arrogant, for eBay to want to grab me by the throat and to choke every last drop of air out of my entrepreneurial spirit.

I've learned in life that the more you attempt to control someone - or anything - the more it will rebel. I've learned that rules are made to be broken. I've learned that laws, indeed, do change. Frankly, let eBay make all of the rules they can conjure up in their little, black cauldron. Other than selling on their site, I restrict my contact with them to a bare minimum. I don't 'do' their message boards or forums or make phone calls to them. They provide for me a venue to sell. I pay my bill and then I disappear into the darkness until the following month. I leave as light of a footprint as possible other than being one of their 'favored' sellers.

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by: WhoKnewIt This user has validated their user name.

Thu Aug 23 09:14:16 2012

Has anyone checked to see if this new addition to the "rules" is even legal in all 50 states?  So glad I'm no longer there and wonder why so many are still staying!  

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This user has validated their user name. by: Philip Cohen
Web Site

Thu Aug 23 09:15:58 2012

eBay takes no notice of "the law"; they are too busy criminally facilitating the likes of rampant shill bidding eBay sellers like "eDropOff" to defraud buyers, in a desperate attempt to underpin their their sagging bottom line ...

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by: pace306 This user has validated their user name.

Thu Aug 23 09:27:40 2012

The policy update must have come from eBay/Paypal geting a sniff of what's ''in the wind'' ... somebody, somewhere preparing a lawsuit against them.

There are so many quasi illegal things that eBay does, that its hard to remember them all - but they do know this ...

Its expensive to sue. As a single individual you cant afford to sue eBay - even when what eBay does is obvious and blantant.

However, 50 or 100 or 1000 users CAN afford to stop eBay - and they are deathly afraid of it. The mentally incompetant lawyers at eBay know just that much and are making sure that once again the playing feild cant be level.

Utah? there must be some consumer protection law thats old and outdated that eBay knows about - that we dont. Their last verbage about this issue was that they demand you deal wth them in San Jose. I'd have to guess that CA tightened up thier consumer protection laws enough so that eBay cant run roughshod over a seller there - so they switched to UT.

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by: ebay refugee camp This user has validated their user name.

Thu Aug 23 09:52:28 2012

I think ebay is going to make a change that is going to do away with a a large number of sellers. All of you selling used, antiques, collectibles, custom personalized items who do not dropship from a fulfillment center may be gone. That is part of what this is about. DUNCEAHOE'S disruptive innovations or you may know it as stael from the poor and give to the rich. He was the president of Bain and Co. before ebay so that explains alot. Obviuoly changing this to Utah is interesting maybe that is where they were able to bribe the most judges. We have a company that sells ads to your competitors on your ad page, we have a company that has a TRS system that is so unfair and corrupt it is just unbelievable. We have a company that has has major technical issues for the last year. We have a company whose search does not return results, that has proven over and over again. Any of these can bring a class action. Watch for Paypal to follow suit, Paypal holds are illegal in my opinion. Once again start listing elsewhere, call your senator and congreeman or woman and ask them if this is legal. File your complaints with ta stste attorney general and the Justice department. This company is absolutely dishonest there is no doubt. They are completely paranoid about something.

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by: Here We Go Again This user has validated their user name.

Thu Aug 23 10:48:51 2012

Report this far and wide.  BBB, Attorney General.  Nothing may happen but enough complaints will continue to keep eyebrows raised.  Forward this also to someone on Wall Street who can get this around.  This is the kind of stuff investors need to see. Opting out of "class action" doesn't mean you can't go after them individually, which actually is better for the plaintiff.  In a class action you'll only get a pittance.  If you sue them individually for losses, you can get a payday.  Sure their attorneys will do what they can but these folks have broken the law time and again and seem to be teflon.  I have no ebay account, closed it a few years back when things got out of control.  I make a better living elsewhere without the aggrevation.  These people break the law all day, every day.  Very sad indeed.  

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by: Patricia This user has validated their user name.

Thu Aug 23 10:55:10 2012

I don't know that anybody gets rich in one of these class action suits.  Just received a check from a Google class action suit I didn't even know I was in....the check is for 31 cents!

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by: genejhsn This user has validated their user name.
Web Site

Thu Aug 23 11:01:48 2012

Ebay is fearful - and rightfully so - that sellers will gang up on them for not providing the exposure for which sellers are paying. I remarked to my wife last evening how eBay should be subject to a class action suit for failing to provide agreed upon services. Then I check my eBay messages and find the new user agreement!


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