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Sony's Asking You to Waive Your Rights, But You Have Options

Keep your legal rights by sending a letter--we even made a template! Plus, a lawyer questions whether this will even hold up.

Agreeing toPSN's new Terms of Service waives certain legal rights, unless you mail a letter.

UPDATE: Some users pointed out this wouldn't apply worldwide, as laws are in place elsewhere to protect consumers from this. Kotaku Australia confirmed it won't apply to Europe or Australia.

ORIGINAL STORY: When I booted up NFL Sunday Ticket to watch the Chicago Bears on Sunday (which worked fine this week), Sony asked me to agree to an updated Terms of Service to access PlayStation Network. Standard stuff. We blindly agree to these things all the time, but this time, it's different.

Sony is asking you to waive the right to collectively sue them, and instead resolve any disputes individually through another process called arbitration (read: outside of the courts).

Sony has not revealed why it's implemented this change, but it's easy to guess it's in response to PSN security imploding back in April, exposing the personal data of 75 million PSN accounts. It was a total disaster.

Within days after admitting PSN had been compromised, the company had been sued, that time by 36-year-old Kristopher Johns of Birmingham, Ala, in the U.S. District Court for the Northern District of California.

Below is the legal excerpt causing a stir, but you can read the entire updated Terms of Service right here.

"Any dispute resolution proceedings, whether in arbitration or court, will be conducted only on an individual basis and not in a class or representative action or as a named or unnamed member in a class, consolidated, representative or private attorney general legal action, unless both you and the Sony entity with which you have a dispute specifically agree to do so in writing following initiation of the arbitration. This provision does not preclude your participation as a member in a class action filed on or before August 20, 2011."

If you don't agree, you cannot continue to play games online. That's a hard bargain.

The reason people bring class action lawsuits against companies runs under the the same principles governing unions: power in numbers. One person's going to have a tough time staring down a giant corporation, but if thousands or millions of people are speaking together, there's a chance it'll listen. Having the discussion happen behind-closed-doors doesn't help matters.

This effectively cuts group action off at the knees.

Sony's likely buried the opt-out option in this update to discourage anyone from opting-out.

"This really sort of sucks because it is doubtful that any individual could afford to sue them," explained Washington attorney Thomas Buscaglia, who specializes in games. "Not sure how enforceable it will be, but I think it it would be really cool if gamers started to circulate a form opt out rejection of these terms and mailed them in."

As it turns out, there's an opt-out buried in the Terms of Service, but if you've already signed off on the updated Terms of Service, you need to act quickly; Sony's built a countdown into the agreement itself.

"If you do not wish to be bound by the binding arbitration and class action waiver in this Section 15," reads the Terms of Service, "you must notify SNEI [Sony Network Entertainment] in writing within 30 days of the date that you accept this agreement."

Tick, tock. Tick, tock.

To retain your right to participate in class action lawsuits, you must send the company a letter with your name, address, PSN account and a "clear statement that you do not wish to resolve disputes with any Sony entity through arbitration." Once you have that letter prepared, print it out and mail it here:

6080 Center Drive
10th Floor
Los Angeles, CA 90045
Attn: Legal Department/Arbitration
Attn: Sony Legal Department: Dispute Resolution

I'll even make things easier: here's a document I created you can use as your personal template.

What happens next isn't clear.

Sony has provided all 75 million and counting members of PSN a clear way to maintain their existing rights, but by asking everyone to agree to ditching those rights in order to continue using PSN and asking them to mail a letter to keep them, they've ensured most will have given them away. That's assuming the majority of users are even aware something substantive has changed; how often have you seen an email full of legal mumbo jumbo, pretended to read it, then quickly deleted it?

That said, Sony's move could run into problems, regardless of whether you send in a letter or not.

"This is certainly not standard practice by any standards...in fact it may well not be enforceable," said Buscaglia. "Time will tell on that one. The US Federal Trade Commission and various state consumer protection agencies could have a problem with it. Also, some courts might not allow it to be enforced due to existing state court precedent."

Even if this move wouldn't hold up in court (ironic!), it may scare off anyone from trying, which would make it a success.

As Buscaglia said, time will tell. In the meantime, maybe you should go buy some stamps.

Patrick Klepek on Google+
328 Comments
Posted by patrickklepek
Agreeing toPSN's new Terms of Service waives certain legal rights, unless you mail a letter.

UPDATE: Some users pointed out this wouldn't apply worldwide, as laws are in place elsewhere to protect consumers from this. Kotaku Australia confirmed it won't apply to Europe or Australia.

ORIGINAL STORY: When I booted up NFL Sunday Ticket to watch the Chicago Bears on Sunday (which worked fine this week), Sony asked me to agree to an updated Terms of Service to access PlayStation Network. Standard stuff. We blindly agree to these things all the time, but this time, it's different.

Sony is asking you to waive the right to collectively sue them, and instead resolve any disputes individually through another process called arbitration (read: outside of the courts).

Sony has not revealed why it's implemented this change, but it's easy to guess it's in response to PSN security imploding back in April, exposing the personal data of 75 million PSN accounts. It was a total disaster.

Within days after admitting PSN had been compromised, the company had been sued, that time by 36-year-old Kristopher Johns of Birmingham, Ala, in the U.S. District Court for the Northern District of California.

Below is the legal excerpt causing a stir, but you can read the entire updated Terms of Service right here.

"Any dispute resolution proceedings, whether in arbitration or court, will be conducted only on an individual basis and not in a class or representative action or as a named or unnamed member in a class, consolidated, representative or private attorney general legal action, unless both you and the Sony entity with which you have a dispute specifically agree to do so in writing following initiation of the arbitration. This provision does not preclude your participation as a member in a class action filed on or before August 20, 2011."

If you don't agree, you cannot continue to play games online. That's a hard bargain.

The reason people bring class action lawsuits against companies runs under the the same principles governing unions: power in numbers. One person's going to have a tough time staring down a giant corporation, but if thousands or millions of people are speaking together, there's a chance it'll listen. Having the discussion happen behind-closed-doors doesn't help matters.

This effectively cuts group action off at the knees.

Sony's likely buried the opt-out option in this update to discourage anyone from opting-out.

"This really sort of sucks because it is doubtful that any individual could afford to sue them," explained Washington attorney Thomas Buscaglia, who specializes in games. "Not sure how enforceable it will be, but I think it it would be really cool if gamers started to circulate a form opt out rejection of these terms and mailed them in."

As it turns out, there's an opt-out buried in the Terms of Service, but if you've already signed off on the updated Terms of Service, you need to act quickly; Sony's built a countdown into the agreement itself.

"If you do not wish to be bound by the binding arbitration and class action waiver in this Section 15," reads the Terms of Service, "you must notify SNEI [Sony Network Entertainment] in writing within 30 days of the date that you accept this agreement."

Tick, tock. Tick, tock.

To retain your right to participate in class action lawsuits, you must send the company a letter with your name, address, PSN account and a "clear statement that you do not wish to resolve disputes with any Sony entity through arbitration." Once you have that letter prepared, print it out and mail it here:

6080 Center Drive
10th Floor
Los Angeles, CA 90045
Attn: Legal Department/Arbitration
Attn: Sony Legal Department: Dispute Resolution

I'll even make things easier: here's a document I created you can use as your personal template.

What happens next isn't clear.

Sony has provided all 75 million and counting members of PSN a clear way to maintain their existing rights, but by asking everyone to agree to ditching those rights in order to continue using PSN and asking them to mail a letter to keep them, they've ensured most will have given them away. That's assuming the majority of users are even aware something substantive has changed; how often have you seen an email full of legal mumbo jumbo, pretended to read it, then quickly deleted it?

That said, Sony's move could run into problems, regardless of whether you send in a letter or not.

"This is certainly not standard practice by any standards...in fact it may well not be enforceable," said Buscaglia. "Time will tell on that one. The US Federal Trade Commission and various state consumer protection agencies could have a problem with it. Also, some courts might not allow it to be enforced due to existing state court precedent."

Even if this move wouldn't hold up in court (ironic!), it may scare off anyone from trying, which would make it a success.

As Buscaglia said, time will tell. In the meantime, maybe you should go buy some stamps.

Staff
Edited by Cyrisaurus

I clicked agree, and moved on. You know why? Because I just want to play games online. I don't have any intentions of going out of my way to try and sue some major company.

And you know what? I doubt anyone else does too. I guarantee you that 100% of the people who complain about this have no intentions of suing Sony (and probably don't own a PS3). Some people just like to bitch because they think "Hur I'm an American, you can't take my rights". If Sony issued a new ToS stating that you were not allowed to stab yourself in the eye with a fork, there would be thousands of people raging over the situation acting like Sony is evil, just like this situation.

Newsflash, nobody lost their CC info from the PSN attacks, or suffered any long-term effects. So it would be best for people to move on, and just play some damn video games

Edited by zanshin

damn Second place means you lost...

What would you expect from the makers of the secret root kit. This is why I don't buy sony products AT ALL.

Posted by Afroman269

I don't use my ps3 enough to care about all this but I think I'll send in a letter anyways. Thanks for the heads up, Patrick.

Posted by Airickson

I hope you 'created' the document and didn't just 'crate' it, Patrick.

Posted by ArcadiaExeter

Wow and i did blindly agree to that when it came up. thank you Mr. Klepek for watching my back.

Posted by Foxillusion

Patrick, you're a gentleman and a scholar. Thanks for this story.

Posted by itsjoncharles

I hope people don't say 'I can't be bothered' and actually do it.

Posted by Mr_Skeleton

lawyered!

Posted by White_Silhouette

I know I choose not to play my PS3 online until sony changes the policy.. I'm also going to write a politely worded letter to any devs of PSN games that I want to play. Telling them they have lost a potential sale due Sony's current EULA

Posted by probablytuna

According to Kotaku, it does not affect Europe/Australia right now.

Edited by Grambyte

And it all used to be so simple. Put in cardridge, play game.

Posted by Rudy

Total crap. Lawyers are a special breed, indeed

Posted by Video_Game_King

Yous mays wants to proofsreads this articles, I thinks you crateds someserrors. (I don't know why I'm talking like Skwisgar.)

Posted by 71Ranchero

Less QQ, more QL.

Online
Posted by DarkbeatDK

Oh man I didn't read that and I updated my PS3 this morning blindly as usual.

One of these days the devil is going to appear at my doorstep and tell me how I agreed to get bumloved in one of those countless EULAs I seem to agree on weekly.

Posted by RA20R

@Mr_Skeleton: couldn't have said it better myself... well played sir lol

Posted by MEATBALL

So goddamn slimey, news is the ToS haven't changed for Australia...so uh, that's good I guess?

Posted by logson

Very cool to include that template. Thanks!

Also, shouldn't the blurb read "...Plus, a lawyer questions whether this will even hold up." ?

Posted by EnchantedEcho
Posted by BenderUnit22
Posted by mazik765

Wow...that's really underhanded. I'd fill it out but I don't own a PS3.

Posted by Dross

Thanks Patrick!

Posted by Vinny_Says

man I sure hope my PS3 doesn't explode and amputate me....cause then I wouldn't be able to sue them.

Posted by Devoid

Yeah, my e-mail I use for my American account got an e-mail the other day about this. It's no problem for me. It's really weird that Sony would go do this though.

Posted by PacManFevaa

@BenderUnit22: I am American and I think it's ridiculous.

Posted by 71Ranchero
Online
Posted by snetErz
What happens next isn't clear.

According to the sony email I received on the change this is what happens next:

You may click here(link removed) to review the changes to the TOS and you may click here(link removed) to review the changes to the Privacy Policy. If you do not agree with the new TOS or Privacy Policy, or if you do not wish to enter into an agreement with SNEI, you may decline the TOS and Privacy Policy and we will close your account and return your funds.

As far as I can see by the hand of the law, sending that letter effectively means you decline the TOS (even if it's that one section) and PP, and they will close your account. Hence why they need your username and psn info, most likely (other than being able to know who waived that part). Although, they could be genuinely interested in your rights to have class action lawsuits, but I will leave it to your own interpretation. Your thoughts?

Posted by LtKetch

I think the legal action against Sony after the security breach was mostly a cash grab and a waste of legal resources. (Admittedly an uneducated, non-legally informed opinion). Now if the leak had been as serious as first thought, meaning large numbers of active credit card accounts were compromised, then legal action would be justified. If I understand this change to terms the terms of service, Sony is asking you to give up your ability to bring class action cases against them regardless of the legitimacy of the case.

My first thought was that this would not stand up, again, I am not a lawyer, but asking people to give up their legal rights with waivers etc doesn't usually hold up. That said this may, as Patrick mentioned, lead to people not even trying as they think they have given up their ability to do so. I think this is a poor decision by Sony and I for one will be sending them a letter, on principle alone.

Thanks for the continued coverage Patrick.

Posted by jkuc316

I don't get it, what's the problem everyone? You're probably not gonna sue them anyways...

Posted by nukesniper

I almost want to fill this out even though I haven't used my PS3 recently. I just want to do it to dissuade these ridiculous EULAs. I don't want to actually have to start reading those, and with this and EA's Origin thing a bit ago, I can't trust these companies. I like the thought of them getting a million letters against this, so they think twice about putting the next dumb thing in their EULA.

Posted by ptys

Confusing small print should be made illegal.

Posted by Hailinel

Holds up, now! Holds up! I sees a typos in the headlines, Patricks!

Posted by beritbunny

@Cyrisaurus: This isn't about WANTING to sue, it is about retaining your rights to do so (specifically as a part of a group).

I bet you are also fine with the Patriot Act. Just keep pickling yourself in infotainment, Gamer.

Now for a little self-loathing: our household also just clicked on through that agreement. Gah. Busy to-do list today to make up for it. 1. Connect laptop which actually works with printer. 2. Print letter. 3. Mail letter. 4. Beef up tinfoil hat surplus. lol

Posted by rockhardalibi

@Cyrisaurus said:

I clicked agree, and moved on. You know why? Because I just want to play games online. I don't have any intentions of going out of my way to try and sue some major company.

And you know what? I doubt anyone else does too. I guarantee you that 100% of the people who complain about this have no intentions of suing Sony (and probably don't own a PS3). Some people just like to bitch because they think "Hur I'm an American, you can't take my rights". If Sony issued a new ToS stating that you were not allowed to stab yourself in the eye with a fork, there would be thousands of people raging over the situation acting like Sony is evil, just like this situation.

Newsflash, nobody lost their CC info from the PSN attacks, or suffered any long-term effects. So it would be best for people to move on, and just play some damn video games

This isn't about wanting to sue Sony, it's about those long EULAs having little things chucked in that remove rights beyond what is reasonable. I don't own a PS3 but I do have an interest in keeping those legal documents clean, and this seems a little dirty.

Nice anti-American jab in there by the way, that stung.

Posted by akumous

This is not uncommon of big multinational corporations like Sony, everyone does it and they conveniently trap their user base in such a dilemma to avoid losing. If an individual wishes to take the right path that would protect their rights he or she has to go through much tedious bureaucratic nonsense just for their voices to be heard. Corporations have too much power and something mush be to done to stop this because the average person does not have the resources to oppose them.

Posted by Quantical

Just watch Rugby instead. Problem solved.

Posted by RiotBananas

I don't normally care and don't intend of suing Sony anyway but I'm going to send a fucking letter just as a matter of principle.

Posted by Swoxx

@Mr_Skeleton said:

lawyered!

aww yeah

Edited by Doppelgamer
Edited by GUTBOMB

Awww the modern litigation nation. Many of those who join these "crusades" are not doing so out of some sense of justice or ethics, they simply want a lottery ticket from the legal system and someone's pocket.

The fact is many companies put dubious terms in their Terms of Service, although the are frequently overturned if it was deemed extremely damaging to a customer. Yes, Sony has security holes that need to plugged, and they have taken steps to do so. Hell, Google is significantly more of a threat on a daily basis to someone's security, than PSN.

The only people that benefit from these class action lawsuits are the lawyers, who are laughing all the way to the proverbial bank.

I am sure Sony realizes that the number of people who will opt out, is virtually guaranteed to be too small for any legal undertaking. I heard someone say it has the affect of signing an Internet petition, which I think is unfortunately accurate.

Posted by dbz1995

Sent one from England. Let's get all international in their ass

Posted by Spiritof

Unless Sony drives by my house and maliciously runs over my dog, I'm not going to sue Sony.

Posted by FresherThanAir

Maybe Sony done this because they know the PSN is still at a risk from hacking but does not what to be held more responsible this time or in the long run, lose money. Clever trick Sony.

Posted by knightlyknave

There's no way that'll hold up in court. You can't just sign away your rights to a fair trail because you clicked on an "agree" button.

Edited by Moonshadow101

Pfft, who need rights?

But seriously, this is dirty as hell. Companies need to be accountable. if MS had something like this a few years ago, they probably wouldn't have extended the warranty. Binding arbitration clauses are designed to render companies invincible.

Posted by Cyrisaurus

@rockhardalibi: How is beyond reasonable? Sony took enough shit from PSN going down, I'm sure they want to do what they can before anti-Sony groups add insult to injury.

How many ToS's do you blindly accept? Do you think this is the first one to pull a fast one on you?

Posted by NinjaCommando

SIGH.

Posted by Korosuzo

@nukesniper said:

I almost want to fill this out even though I haven't used my PS3 recently. I just want to do it to dissuade these ridiculous EULAs. I don't want to actually have to start reading those, and with this and EA's Origin thing a bit ago, I can't trust these companies. I like the thought of them getting a million letters against this, so they think twice about putting the next dumb thing in their EULA.

Agree completely. I would never sue but the fact that they are adding these ridiculous items in the EULA and hoping nobody reads them (which most rarely do) makes me think a little less of Sony and their respect for the consumer. I understand it's a business but the fact I need to agree to these terms to play games online and give away some of my rights is insane.

Posted by MeatSim

Ugh looks like I need to pay more attention to Terms of Service now.