Microsoft Joins Bandwagon to Block Class Action Lawsuits

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Posted by patrickklepek (5526 posts) -
The slightly delayed dashboard went live yesterday, bringing with it big legal changes.

When updating to Microsoft’s new Xbox 360 dashboard, you’re also agreeing to an updated Terms of Service.

Not surprisingly, Microsoft has joined Sony and Electronic Arts in asking consumers to waive away their rights to participate in class action lawsuits against them, preferring individual arbitration that's way cheaper for the company, doesn't involve a jury and avoids headlines.

The notable tweaks begin in section 18.1 of the updated Terms of Service, the most important change being this section:

“YOU UNDERSTAND AND ACKNOWLEDGE THAT BY AGREEING TO BINDING ARBITRATION, YOU ARE GIVING UP THE RIGHT TO LITIGATE (OR PARTICIPATE IN AS A PARTY OR CLASS MEMBER) ALL DISPUTES IN COURT BEFORE A JUDGE OR JURY. INSTEAD, YOU UNDERSTAND AND AGREE THAT ALL DISPUTES WILL BE RESOLVED BEFORE A NEUTRAL ARBITRATOR.”

This language is similar to what both Sony rolled out after PlayStation Network suffered from a long outage, the result of a compromised network that exposed the personal information of tens of millions.

As with previous Terms of Service changes, however, you have the option to continue using the service, while also rejecting the changes made to your rights toward class action lawsuits.

“Notwithstanding anything to the contrary in this contract, Microsoft agrees that if it makes any change to Section 18.1 (other than a change to the notice address in Section 18.1.3) while you are authorized to use the Service, you may reject the change by sending us written notice within 30 days of the change by U.S. Mail to the address in Section 18.1.3. By rejecting the change, you agree that you will informally negotiate and arbitrate any Dispute between us in accordance with the most recent version of Section 18.1 before the change you rejected.”

That address, by the way, is Microsoft Corporation, ATTN: LCA ARBITRATION, One Microsoft Way, Redmond, WA 98052-6399, and you’re free to modify a template I created for the PSN incident that should work just fine in this situation, too.

Sony is the only company to publicly discuss the change, explaining it was only responding to a recent Supreme Court decision that allowed AT&T to prevent employees from engaging in class action lawsuits.

#1 Posted by patrickklepek (5526 posts) -
The slightly delayed dashboard went live yesterday, bringing with it big legal changes.

When updating to Microsoft’s new Xbox 360 dashboard, you’re also agreeing to an updated Terms of Service.

Not surprisingly, Microsoft has joined Sony and Electronic Arts in asking consumers to waive away their rights to participate in class action lawsuits against them, preferring individual arbitration that's way cheaper for the company, doesn't involve a jury and avoids headlines.

The notable tweaks begin in section 18.1 of the updated Terms of Service, the most important change being this section:

“YOU UNDERSTAND AND ACKNOWLEDGE THAT BY AGREEING TO BINDING ARBITRATION, YOU ARE GIVING UP THE RIGHT TO LITIGATE (OR PARTICIPATE IN AS A PARTY OR CLASS MEMBER) ALL DISPUTES IN COURT BEFORE A JUDGE OR JURY. INSTEAD, YOU UNDERSTAND AND AGREE THAT ALL DISPUTES WILL BE RESOLVED BEFORE A NEUTRAL ARBITRATOR.”

This language is similar to what both Sony rolled out after PlayStation Network suffered from a long outage, the result of a compromised network that exposed the personal information of tens of millions.

As with previous Terms of Service changes, however, you have the option to continue using the service, while also rejecting the changes made to your rights toward class action lawsuits.

“Notwithstanding anything to the contrary in this contract, Microsoft agrees that if it makes any change to Section 18.1 (other than a change to the notice address in Section 18.1.3) while you are authorized to use the Service, you may reject the change by sending us written notice within 30 days of the change by U.S. Mail to the address in Section 18.1.3. By rejecting the change, you agree that you will informally negotiate and arbitrate any Dispute between us in accordance with the most recent version of Section 18.1 before the change you rejected.”

That address, by the way, is Microsoft Corporation, ATTN: LCA ARBITRATION, One Microsoft Way, Redmond, WA 98052-6399, and you’re free to modify a template I created for the PSN incident that should work just fine in this situation, too.

Sony is the only company to publicly discuss the change, explaining it was only responding to a recent Supreme Court decision that allowed AT&T to prevent employees from engaging in class action lawsuits.

#2 Edited by Commisar123 (1796 posts) -

Oh.......good

#3 Posted by NewfieBullet (87 posts) -

I wonder if its the same in Canada, hmmmmmmmmmmmmmmm

#4 Posted by Procyon27 (40 posts) -

Par for the course really....this is one of the many drawbacks of living in a country controlled by huge corporations. I am not saying it's right, but that is the nature of the Amurika that we live in.

#5 Posted by Napalm (9020 posts) -

Goddamn it.

#6 Posted by Getz (3096 posts) -

While most people reading this will never have the need to engage in a class-action lawsuit against Microsoft, it's a little fucked that clauses like this are even legally allowed.

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#7 Posted by Airickson (120 posts) -

@Procyon27 said:

Par for the course really....this is one of the many drawbacks of living in a country controlled by huge corporations. I am not saying it's right, but that is the nature of the Amurika that we live in.

Hard to say if it's the large corporations or all the damn lawyers. At the end of the day, I guess the end result is the same.

#8 Posted by Dezinus (296 posts) -
#9 Posted by Mesoian (1574 posts) -

Does anyone have a link to the people who were actively sending out paper opt-out letters en-masse to Sony via webtemplate?

Those guys could probably make this whole process very easy for everyone in the upcoming future.

#10 Posted by SerHulse (685 posts) -

If I am outside the US can I still send this letter via US Mail? If so how?

#11 Posted by Mutley (300 posts) -

Oh fiddle-biscuits...

#12 Posted by WinterSnowblind (7617 posts) -

I'm glad this is illegal in the UK.

#13 Posted by RE_Player1 (7563 posts) -

That template has really come in hand Pat. Hopefully other big companies don't join the club.

#14 Posted by Thor_Molecules (732 posts) -

Riot in the streets!

#15 Posted by Forcen (1835 posts) -

This does not affect any countries in the European Union right? I remember that being the case with the sony thing.

#16 Posted by OldGuy (1566 posts) -

I'll give Microsoft this much: there is a big ass, all caps notification that there is a binding arbitration section right at the beginning of the TOS that displays even if you do not scroll down at all...

#17 Posted by jakob187 (21690 posts) -

Glad I threw the dog a bone via Twitter about this last night...

#18 Edited by Brackynews (4094 posts) -

@Hulsey90: Yes. Once the letter arrives in the U.S. it is handled by U.S. Postal Service. They are specifically saying write a letter and sign it, don't e-mail, don't use an overnight courier, don't show up in person at the front desk, etc... The law recognizes the postal service in a special way that does not necessarily apply to other methods.

@NewfieBullet: Yup, unless the province has consumer legislation barring it. Canadian law becomes more like U.S. law every year. The formal term is "harmonizing".

I am not a lawyer, but I am writing a law final in about 3 hours... >_<

#19 Posted by AndrewB (7668 posts) -

I've yet to agree to the Sony EULA and I caught this story literally seconds before the 360 update finished (and declined the EULA). That this isn't considered illegal is just further evidence of corporate corruption in America and the rest of the world.

#20 Posted by elcalavera (344 posts) -

I'll just say that I'm happy I live in Europe.

#21 Posted by 234r2we232 (3181 posts) -

Briefing through the T&C. Apparently MS would like you to know that they have total control over your Gamertag and Motto and are free to use it for whatever purpose they desire. In the paragraph following this, they would also like it if you would please respect their rights, and the rights of their employees.

>_<

#22 Posted by NipCrip66 (125 posts) -

@Forcen: yeah you still have rights in the E.U. so this is doesn't affect you.

#23 Posted by DocHaus (1349 posts) -

That AT&T and WalMart used the courts to block their own employees from joining a class-action lawsuit against them is dubious in itself (Oh, you were passed over for promotion or fired for no reason? Good luck finding a lawyer with your $10/hr paycheck after you pay for food and rent). What I want to know is where this logic can extend to the customers of those companies, that they are forced to air their grievances in arbitration where the company almost always has home-field advantage.

Honestly, I'm thinking of writing the state's attorney general about this, if only for some clarification on the legality of this issue. If you live in the US, especially if you happen to live in Washington state, I'd suggest you do so as well. Maybe, just maybe, we can raise awareness of this issue before it begins to spread outside of entertainment and electronics.

#24 Posted by CL60 (16906 posts) -

Who cares?

#25 Edited by Three0neFive (2297 posts) -

Sony does it, "holy shit what the fuck its the end of times fuck you". Microsoft does it, "meh."
 
Gamer logic.

#26 Posted by scottygrayskull (456 posts) -

Huh... something I'm wondering since this is a pay service. If you're in the middle of a gold membership and don't agree do you have a claim to get the remainder of your $60 refunded?

#27 Edited by AngriGhandi (784 posts) -

Thanks supreme court

Litigate my balls

Edit: It took me two and a half minutes holding "down" on the right stick just to reach the part of the EULA that explains this great info-- 4:40 to get to the bottom of the whole thing! This is totally okay. Everything is fine.

Weyland-Yutani '16.

#28 Posted by FCKSNAP (2299 posts) -

@Three0neFive said:

Sony does it, "holy shit what the fuck its the end of times fuck you". Microsoft does it, "meh." Gamer logic.
#29 Posted by Wuddel (2098 posts) -

@WinterSnowblind said:

I'm glad this is illegal in the UK.

Or everywhere else in Europe I hope.

#30 Posted by N7 (3595 posts) -
@Snapstacle said:

@Three0neFive said:

Sony does it, "holy shit what the fuck its the end of times fuck you". Microsoft does it, "meh." Gamer logic.
#31 Posted by BRNK (307 posts) -

@CL60 said:

Who cares?

You and your apathetic ilk are the reason shit like this flies.

WHO CAAERS IF UR TRADING UR RIGHTS AWAY, IT E-Z.

#32 Posted by randomfella21 (62 posts) -

@sofacitysweetheart said:

Briefing through the T&C. Apparently MS would like you to know that they have total control over your Gamertag and Motto and are free to use it for whatever purpose they desire. In the paragraph following this, they would also like it if you would please respect their rights, and the rights of their employees.

>_<

I'm not exactly sure what the problem with this is. Microsoft is providing a service, therefore as someone who subscribes to that service, I wouldn't expect to have any kind of ownership over anything. This is just a bunch of lawyer-speak to make sure all the bases are covered, but it's not like they're actually going to do much of anything about it. At the end of the day, they're a business that is totally dependent on us, their customers. If they do ANYTHING that is too shady, people will stop paying for their service, and they will lose money and will be forced to either change their policies or go under.

Now, I'm not saying that this whole "no class action lawsuit" thing isn't shady. I don't like it personally, and I believe that it is a right of the consumer to take a company to court to have a dispute resolved. But as far as control of my Gamertag and Motto and stuff, I really don't see why anyone would think that's not right.

#33 Posted by jjnen (661 posts) -

@CL60 said:

Who cares?

Why are you okay with MS taking away some of your rights?

#34 Posted by MaddProdigy (1041 posts) -

Any lawyers in the GB community who can comment on the legality of this. I'm pretty sure any judge would immediately see that since your options are to either accept or render your payed for product useless, this is some questionable stuff. Similar to cases surrounding systems that allow them to brick your product from afar, or that don't allow you to modify something you already bought.

#35 Posted by I_smell (3924 posts) -

@WinterSnowblind said:

I'm glad this is illegal in the UK.

If I'm in England do I not have to do anything?

#36 Posted by N7 (3595 posts) -
@MaddProdigy said:

Any lawyers in the GB community who can comment on the legality of this. I'm pretty sure any judge would immediately see that since your options are to either accept or render your payed for product useless, this is some questionable stuff. Similar to cases surrounding systems that allow them to brick your product from afar, or that don't allow you to modify something you already bought.

What I'm thinking is, couldn't they just say that, since this is an optional service, you don't NEED to pay for it, thus making that argument invalid?
 
Man, you know what, what is the legality on this whole situation? We need a lawyer division on Whiskey Media. Like, "Schooled" or something.
#37 Posted by CL60 (16906 posts) -

@BRNK said:

@CL60 said:

Who cares?

You and your apathetic ilk are the reason shit like this flies.

WHO CAAERS IF UR TRADING UR RIGHTS AWAY, IT E-Z.

@Rappelsiini said:

@CL60 said:

Who cares?

Why are you okay with MS taking away some of your rights?

Because it quite literally doesn't affect me and pretty much everybody else. So I really don't care.

#38 Posted by pw2566ch (480 posts) -

@Mesoian said:

Does anyone have a link to the people who were actively sending out paper opt-out letters en-masse to Sony via webtemplate?

Those guys could probably make this whole process very easy for everyone in the upcoming future.

It's gamersoptout.com. Though, I would suggest using the template that Patrick provided because for one, the site is down, and second I don't think they know about the site knows about Microsoft's change in agreement. All you have to do is replace Sony with Microsoft and change the address. Very simple stuff.

#39 Edited by bananaz (259 posts) -

@randomfella21: It's not about ownership of Live. If you're suing MS, the implication is that you've been hurt or ripped off. That matters in the real world. If you have a case against them, it means they owe you.

If you don't have a good case, you can lose a lawsuit. That's fair. Corporations make mistakes, just like people. Why shouldn't they pay for their mistakes? It's how you learn things. Instead of companies learning to cover themselves in an unfair way, why shouldn't they learn to do better to prevent lawsuits? Risk keeps people honest. They can afford lawsuits.

#40 Posted by konichi (2 posts) -

Question. This change was based on the AT&T stopping EMPLOYEE'S from participating in a class action lawsuit. Does this now mean i should charge Microsoft for all the unpaid time i have spent on their console, as employer/employee law differs from consumer law. Just a thought.

#41 Posted by l4wd0g (1983 posts) -

@AndrewB said:

I've yet to agree to the Sony EULA and I caught this story literally seconds before the 360 update finished (and declined the EULA). That this isn't considered illegal is just further evidence of corporate corruption in America and the rest of the world.

You're a a freshman college student aren't you.

#42 Posted by AndrewB (7668 posts) -

@l4wd0g: If you aren't outraged by the notion of waiving your rights, I really don't know what to say.

#43 Posted by randomfella21 (62 posts) -

@bananaz said:

@randomfella21: It's not about ownership of Live. If you're suing MS, the implication is that you've been hurt or ripped off. That matters in the real world. If you have a case against them, it means they owe you.

If you don't have a good case, you can lose a lawsuit. That's fair. Corporations make mistakes, just like people. Why shouldn't they pay for their mistakes? It's how you learn things. Instead of learning to cover themselves in an unfair way, why learn to do better to prevent lawsuits. Risk keeps you honest.

Yeah I know in my original post I was responding to someone that seemed to have an issue with Microsoft retaining ownership rights of your gamertag, motto and such. I totally agree with the whole lawsuit issue, even though I've never had a need to sue a company before. It just seems weird that It's legal for companies to say that their employees and customers cannot sue them, I mean it just doesn't make sense.

I still maintain that if Microsoft did something bad enough that got enough peoples attention, lawsuits wouldn't even matter cause the public outrage would probably be enough to get them to take action. I mean at the end of the day without customers they don't make money, so they have to keep people happy. I honestly have a bigger issue with a company policy of not allowing employee lawsuits. That basically allows them to do whatever they want and to hell with everything else, they will still make a ton of money cause their customers are happy, regardless of how happy the employees are.

#44 Posted by Coathangar (5 posts) -

Not surprising. It was only a matter of time before MS would figure out a way to limit the amount of litigations against them.

#45 Posted by jjnen (661 posts) -

@CL60 said:

@BRNK said:

@CL60 said:

Who cares?

You and your apathetic ilk are the reason shit like this flies.

WHO CAAERS IF UR TRADING UR RIGHTS AWAY, IT E-Z.

@Rappelsiini said:

@CL60 said:

Who cares?

Why are you okay with MS taking away some of your rights?

Because it quite literally doesn't affect me and pretty much everybody else. So I really don't care.

Well it literally doesn't affect me as far as I know (I live in Europe so that shit doesn't fly here). But I will never be OK with being forced to give away my rights - regardless if I'm going to use it or not (and let's be honest probably not).

But do you really feel that no one should pay any attention to this?

#46 Posted by l4wd0g (1983 posts) -

This is becoming ridiculous. Consumers need protection for corporations; however, corporations need protection from frivolous lawsuits. Anyone remember Erik Estavillo?

#47 Posted by Chindie (192 posts) -

@Wuddel: IIRC EULAs aren't worth the paper they're printed on (so to speak) in the EU.

#48 Edited by CL60 (16906 posts) -

@Rappelsiini said:

@CL60 said:

@BRNK said:

@CL60 said:

Who cares?

You and your apathetic ilk are the reason shit like this flies.

WHO CAAERS IF UR TRADING UR RIGHTS AWAY, IT E-Z.

@Rappelsiini said:

@CL60 said:

Who cares?

Why are you okay with MS taking away some of your rights?

Because it quite literally doesn't affect me and pretty much everybody else. So I really don't care.

Well it literally doesn't affect me as far as I know (I live in Europe so that shit doesn't fly here). But I will never be OK with being forced to give away my rights - regardless if I'm going to use it or not (and let's be honest probably not).

But do you really feel that no one should pay any attention to this?

The only people who should be outraged are employees of Microsoft. Being outraged because "they took our rights away!!!" is just stupid to me. Because I guarantee 99% of everybody complaining has never, and WILL NEVER file a lawsuit with a company like Microsoft so it doesn't really affect you at all. And when they do actually file a lawsuit, it's just a stupid lawsuit that wont ever go anywhere.

So I feel absolutely no reason to feel outraged about something that I really don't care about. I'm never, and the majority of people will never sue a company over something like Sony getting hacked or something similarly stupid as a reason to sue a company.

#49 Posted by l4wd0g (1983 posts) -

@N7 said:

@Snapstacle said:

@Three0neFive said:

Sony does it, "holy shit what the fuck its the end of times fuck you". Microsoft does it, "meh." Gamer logic.

The difference is that Sony does it when there are MULTIPLE CLASS ACTION LAWSUITS to avoid being sued.

Maybe you should try thinking

#50 Posted by ArbitraryWater (11908 posts) -

I feel like I should be super incensed about this. But no. I'm not. I might send a letter anyways, over Chirstmas break, if only so I can join the class action bandwagon when Microsoft gets sued for making explosive Xboxes or something.

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