Hey there folks. You might not have seen this when (if?) you were updating your Xbox 360 last night, but if you did it successfully, they included a new Terms of Service agreement. But buried within Section 18 of that agreement is a clause similar to that of EA and PSN that waives your right to join a class-action lawsuit and forces all disputes into arbitration if you live in the US.

Some relevant quotes from that section, though I suggest you read the whole thing (or at least the whole section if your eyes are about to glaze over):

18.1.6. CLASS ACTION WAIVER. YOU AND MICROSOFT AGREE THAT ANY PROCEED­INGS TO RESOLVE OR LITIGATE ANY DISPUTE, WHETHER IN ARBITRATION, IN COURT, OR OTHERWISE, WILL BE CONDUCTED SOLELY ON AN INDIVIDUAL BASIS, AND THAT NEITHER YOU NOR MICROSOFT WILL SEEK TO HAVE ANY DISPUTE HEARD AS A CLASS ACTION, A REPRESENTATIVE ACTION, A COLLECTIVE ACTION, A PRIVATE ATTORNEY-GENERAL ACTION, OR IN ANY PROCEEDING IN WHICH YOU OR MICROSOFT ACTS OR PROPOSES TO ACT IN A REPRESENTATIVE CAPACITY. YOU AND MICROSOFT FURTHER AGREE THAT NO ARBITRATION OR PROCEEDING WILL BE JOINED, CONSOLIDATED, OR COMBINED WITH ANOTHER ARBITRATION OR PROCEEDING WITHOUT THE PRIOR WRITTEN CONSENT OF YOU, MICROSOFT, AND ALL PARTIES TO ANY SUCH ARBITRATION OR PROECCEDING.

[note: that last misspelled word is taken verbatim from the official website]

On top of that, they include a trigger mechanism for what will happen if this whole "preemptively stop you from joining a lawsuit" thing ever becomes invalidated.

18.1.10. IF CLASS ACTION WAIVER ILLEGAL OR UNENFORCEABLE. If the class action waiver (which includes a waiver of private attorney-general actions) in Section 18.1.6 is found to be illegal or unenforceable as to all or some parts of a Dispute, whether by judicial, legislative, or other action, then Section 18.1 and its subsections will not apply to those parts. Instead, those parts of the Dispute will be severed and proceed in a court of law, with the remaining parts proceeding in arbitration. The definition of "Dispute" in Section 18.1.1 will still apply to this contract. You and Microsoft irrevocably consent to the exclusive jurisdiction and venue of the state or federal courts in King County, Washington, USA, for all proceedings in court under this Section 18.1.10.

18.1.11. YOUR RIGHT TO REJECT CHANGES TO ARBITRATION AGREEMENT. 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.

18.1.12. SEVERABILITY. If any provision of Section 18.1 and its subsections, other than Section 18.1.6 (class action waiver), is found to be illegal or unenforceable, that provision will be severed from Section 18.1, but the remainder of Section 18.1 will remain in full force and effect. Section 18.1.10 says what happens if Section 18.1.6 (class action waiver) is found to be illegal or unenforceable.

18.1.11 gives you the "opt-out" option discussed before, as long as you mail it within 30 days to Microsoft Corporation, ATTN: LCA ARBITRATION, One Microsoft Way, Redmond, WA 98052-6399, give them your name/address and XBL/GFWL gamertag and tell them you wish to opt-out of this arbitration clause.

Caveat emptor, folks.