The event will explore themes that emerged from a package of essays from an all-star group of Internet legends. Their essays are now available online! A roadmap to them: [Note: the Knight Foundation has adopted lower-case “internet” despite my protestations. Matthew Prince and I even discuss this in our interview.] Initially, he thought web users would share their content as freely as they read content. Instead, “the web took off as a medium with a few publishers and a lot of readers––and not the collaborative mind meld I had hoped for.” His solution: build an infomediary that allows web users to share their content with third parties using custom-set reader-specific permissions. He identified several lessons:
He concludes: “There is still a great deal of room for new developments to improve the safety, security, privacy, reliability and utility of the internet.” He says the Internet “has come to be defined by user-created content,” and Section 230 is a big part of that. He identifies two ways Section 230 can be improved: (1) Internet services should be required to honor court orders to remove content [Note: I’ve written 1k words why I don’t agree with that in this post (see point 4); and due process, the First Amendment, and the FRCP pertain this issue in addition to Section 230.] (2) He would have more clearly said that “platforms can be content creators or developers themselves.” He reiterates a few places where Section 230 says exactly what he wants it to say: (1) the First Amendment protects politically biased content moderation, so Section 230 does not need to address it. (2) “Section 230 does not require political neutrality.” He concludes:
His vision for LinkedIn “was to inspire users to be more intentional about building the professional networks that positively impact both daily work life and long-term career development. This, in turn, would provide them with more economic security and autonomy while simultaneously enabling companies, industries and even entire geographic regions to operate more effectively.” He learned that “as platforms grow, and negative emotions and behaviors like fear, anger, greed and malice gain a foothold, the lowest common denominator often sets the tone. So, what starts out as digital Eden devolves into a digital hell.” He gave an example of how LinkedIn users bypassed writing detailed personal profiles and instead maximized their on-site connections. He says: “however hard I had anticipated it might be to convert emotions like pride and greed into more productive behaviors and aspirational identities, it has proven to be even harder in practice. To do so requires a deliberate, judicious, and consistently well-executed commitment to leadership and governance.” For example, when LinkedIn launched its publishing platform, it gave authoring rights only to 150 top leaders so they could set authoring norms for the entire community. “So, when we opened up the platform to all our users after seventeen months of influencer-only usage, positive and healthy norms had been established.” He concludes: “internet platform builders have an opportunity and an obligation to convert humanity’s negative passions into more positive outcomes. By continuously innovating and renovating the incentive structures and power structures that define these communities, we can both empower individuals and transform the madness of the masses into the prosperity and well-being of the crowd.” He addresses three lessons from the battles over openness:
“[D]isinformation professionals are really good at taking a good thing and building a profitable lie around it, sometimes in order to manufacture a culture war…I feel I failed my community by not preparing for this from the beginning.” She highlights two lessons:
Her solutions:
Instead of submitting an essay, I had an hour-long virtual conversation with Matthew Prince. You can watch the video. Some of the most interesting parts IMO:
Three major lessons they learned: 1) “WE WOULD HAVE WORKED HARDER TO ADAPT TO NEW REGULATION, RATHER THAN RESISTING IT.” “We’ve clearly entered an era of rapidly expanding global technology regulation—and that’s not necessarily a bad thing….We believe it is possible to both adapt to new rules andinnovate successfully.” 2) “WE WOULD HAVE RECOGNIZED EARLIER THAT HEALTHY JOURNALISM IS CRITICAL TO THE DEMOCRACIES IN WHICH OUR BUSINESSES THRIVE.” “We’ve seen time and again the value of trustworthy reporting and we appreciate the role journalism holds in a healthy democracy—and the risk that comes when it’s undermined. Knowing what we do now, we are proactively supporting journalism in several ways.” 3) “WE WOULD HAVE PARTNERED MORE BOLDLY TO HARNESS TECHNOLOGY TOWARD EQUITABLE OUTCOMES FOR PEOPLE AND THE PLANET.” “We must engage boldly not only in corporate and social responsibility, but also in technology and social responsibility.” He discussed Snapchat’s role in encouraging young people to vote. Nirav Tolia (did you see him on Shark Tank on Friday night? Highlight 1. Highlight 2.) Another 80 minute interview with me instead of an essay. Watch the video. Note: Nirav was my boss when I was general counsel at Epinions, and I did some legal work for him at Nextdoor in the early days. Some of the most interesting parts IMO:
Nirav’s conclusion:
Some standout parts of her essay:
He says: “no law in a generation has done more than Section 230 to build online communities and promote informed, productive and equitable communication online. Section 230 was instrumental in fostering new avenues where regular Americans, particularly those from marginalized communities, could speak and be heard…. I don’t regret that Chris and I succeeded in protecting free speech online, then and now.” He wishes he/we had been more proactive on broadband availability, competition, and privacy. In particular:
He concludes: “Americans must not accept the perverse bargain that a healthy national discourse requires sacrificing free speech.” * * * The essay package is a rich resource filled with countless insights. It’s also a great historical snapshot. I encourage you to read the whole package. Meanwhile, want more of this? Come to the symposium and hear really smart and provocative commenters discuss their insights from the essay package. The post Previewing the “Lessons from the First Internet Ages” Symposium appeared first on Technology & Marketing Law Blog. Previewing the “Lessons from the First Internet Ages” Symposium published first on https://immigrationlawyerfirm.weebly.com/ via Tumblr Previewing the “Lessons from the First Internet Ages” Symposium
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This is the latest dubious Internet Law ruling from the Eighth Circuit. (Other dubious rulings in 2021 include Select Comfort v. Baxter and Campbell v. Reisch). In this ruling, the court says Walmart may have imposed a binding arbitration clause on gift card buyers–even though it never used a proper call-to-action or demonstrated that the buyers took any affirmative steps to agree to the terms. The court also created a new definition of browsewrap that further plunges online contract formation law into anarchy. * * *
I trust the tenuousness of Walmart’s position is obvious. A few lowlights:
The district court concluded that the buyers had no notice of the terms and couldn’t be bound by them. The Eighth Circuit reverses and remands the case for a trial on arbitrability. How did the Eighth Circuit reach that conclusion? The Eighth Circuit says that the TOU didn’t form on purchase because Walmart’s call-to-action (by “[u]sing or accessing the Walmart Sites”) expressly didn’t reach that circumstance. As usual, the court sidesteps the fact that a contract did form when the buyers completed the purchase, so Walmart is most likely arguing that the TOU amends the existing contract or constitutes a second in-parallel contract to supplement the contract formed at purchase. The Eighth Circuit then turns to whether the buyers agreed to the TOU by accessing/using the Walmart Sites. It says a browsewrap “imputes assent through the user’s performance of some specific act—here, ‘using or accessing’ Walmart’s website.” It cites the 9th Circuit’s Nguyen case for this definition, but the Nguyen case defined “browsewrap” as “where a website’s terms and conditions of use are generally posted on the website via a hyperlink at the bottom of the screen.” The Eighth Circuit could not have used that definition because, here, the TOU were indirectly referenced on the back of the gift card, not at the “bottom of the screen.” So the Eighth Circuit is defining “browsewrap” differently than the Ninth and Second Circuits, for no apparent good reason. As you know, I hate all of the -wrap terminology. I especially hate the term “browsewrap,” which I always enunciate with a sneer in my voice. And I really, REALLY hate that no one can agree on what the term “browsewrap” means. The Eighth Circuit’s definition is both meaningless and pernicious. It restates the general Contracts 101 principle that contract formation requires mutual manifestations of assent–which can be done by any method that reasonably communicates assent, including overt acts. By defining this as a browsewrap, the Eighth Circuit’s definition seems to reach all calls-to-action that say “by doing X, you agree to Y” and implies that the action of “doing X” turns the call-to-action into a “browsewrap.” That’s a recipe for a lot of confused rulings. The court says the “parties do not dispute that this case involves a browsewrap agreement.” That concession by the plaintiffs seems unnecessary and against their own interests. However, they may have accepted the label because browsewraps usually fail in court. Nevertheless, the court, like some others before it, says that browsewraps might be enforceable if consumers had sufficient notice of the terms. The court says the district court too breezily rejected the possibility that buyers had inquiry notice of the terms. The parties debate whether any of the buyers accessed Walmart’s site; and some buyers may have tried to redeem the cards online. The court also wants to know more about “the exact location and prominence of the terms-of-use hyperlink, how many clicks it would have taken for the user to discover the arbitration provision, and whether the website changed during the relevant period.” The court also doesn’t rule out the possibility that the on-card disclosure (“see Walmart.com for complete terms”) constituted inquiry notice for the buyers (“In theory, this directive could have put the plaintiffs on notice to inquire further by telling them where to go for more information”). The district court will get the pleasure of revisiting all of these issues. To me, it seems obvious that Walmart must lose this arbitration request. At minimum, the plaintiffs could exclude any buyers who actually went to Walmart.com. For those buyers, I just don’t see how the on-card disclosure (“See Walmart.com for complete terms”) can be enough to create inquiry notice given all of the problems I discussed above. So the net result of this Eighth Circuit ruling is that the parties should spend a lot more money to reach the same outcome, and the Eighth Circuit’s unnecessary and garbled recapitulation of the “browsewrap” term should make a further hash of an already messy jurisprudence. To be clear, I think vendors can incorporate terms by reference into a B2C contract formation process, including offline purchases of chattel. Among other necessary steps, the incorporation should be incredibly obvious, the terms should be easy to inspect on the spot, and the call-to-action should be unambiguous. Walmart didn’t satisfy that approach, but they sure could have. Case Citation: Foster v. Walmart, Inc., No. 20-1787 (8th Cir. Oct. 8, 2021) Some Prior Blog Posts on Walmart Litigation
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The district court found Nicosia was bound by the arbitration agreement in Amazon’s terms of service. The Second Circuit affirmed this decision. He now asks the district court to modify and vacate its ruling because Amazon has since eliminated its mandatory arbitration clause. After the Second Circuit affirmed the district court’s rulings that the claims asserted by Nicosia must be arbitrated, the case went to arbitration. The arbitrator’s decision itself is filed under seal, but the court recaps the arbitrator’s findings:
The arbitrator denied Nicosia’s request for declaratory relief that the arbitration clause was void. According to the arbitrator, the plaintiff only sought declaratory relief and did not seek damages. Following the date of the arbitrator’s decision, Amazon modified its terms to eliminate mandatory arbitration. The court says this does not warrant modification of its judgment. The two questions are whether the court’s judgment has “prospective application” and whether such application would be inequitable. The court finds neither condition satisfied. The court says this is the end of the road for Nicosia:
__ Amazon was somewhat unique in its decision to get rid of mandatory arbitration. Companies (such as Uber) have dealt with a big volume of arbitration demands, but companies haven’t abandoned arbitration en masse. It would have been interesting to have been a fly on the wall in the room when Amazon made its decision. I’m curious to know what prompted the court to allow the parties to seal the arbitration order. That seems like it would be interest to the general public. Perhaps some media organization will ask the court to unseal the arbitrator’s ruling. When I first read the court’s most recent order, I predicted a return trip to the Second Circuit for Mr. Nicosia. Sure enough, a check of the docket confirms he will make his third trip there for this case. Case citation: Nicosia v. Amazon, 2021 U.S. Dist. LEXIS 188893 (S.D.N.Y. Sept. 28, 2021) Related posts: Repeated Amazon Purchases Sufficient to Impute Notice of Arbitration Clause Judge Declines to Enforce Uber’s Terms of Service–Meyer v. Kalanick Anarchy Has Ensued In Courts’ Handling of Online Contract Formation (Round Up Post) Evidentiary Failings Undermine Arbitration Clauses in Online Terms Court Enforces Arbitration Clause in Amazon’s Terms of Service–Fagerstrom v. Amazon ‘Flash Sale’ Website Defeats Class Action Claim With Mandatory Arbitration Clause–Starke v. Gilt Some Thoughts On General Mills’ Move To Mandate Arbitration And Waive Class Actions Qwest Gets Mixed Rulings on Contract Arbitration Issue—Grosvenor v. Qwest & Vernon v. Qwest Zynga Wins Arbitration Ruling on “Special Offer” Class Claims Based on Concepcion — Swift v. Zynga “Modified Clickwrap” Upheld In Court–Moule v. UPS Defective Call-to-Action Dooms Online Contract Formation–Sgouros v. TransUnion Court Rejects “Browsewrap.” Is That Surprising?–Long v. ProFlowers Telephony Provider Didn’t Properly Form a “Telephone-Wrap” Contract–James v. Global Tel*Link 2H 2015 Quick Links, Part 7 (Marketing, Advertising, E-Commerce) Second Circuit Enforces Terms Hyperlinked In Confirmation Email–Starkey v. G Adventures If You’re Going To Incorporate Online T&Cs Into a Printed Contract, Do It Right–Holdbrook v. PCS Clickthrough Agreement Upheld–Whitt v. Prosper The “Browsewrap”/”Clickwrap” Distinction Is Falling Apart Safeway Can’t Unilaterally Modify Online Terms Without Notice Clickthrough Agreement With Acknowledgement Checkbox Enforced–Scherillo v. Dun & Bradstreet How To Get Your Clickthrough Agreement Enforced In Court–Moretti v. Hertz The post Lawsuit Still Goes to Arbitration, Even Though Amazon Has Since Removed Its Arbitration Clause–Nicosia v. Amazon appeared first on Technology & Marketing Law Blog. Lawsuit Still Goes to Arbitration, Even Though Amazon Has Since Removed Its Arbitration Clause–Nicosia v. Amazon published first on https://immigrationlawyerfirm.weebly.com/ via Tumblr Lawsuit Still Goes to Arbitration, Even Though Amazon Has Since Removed Its Arbitration Clause–Nicosia v. Amazon
On behalf of a putative class, the plaintiffs asserted privacy claims—including for wiretapping—under California law. The court dismisses FullStory, a Georgia-based corporation, for lack of personal jurisdiction. It dismisses all but one of the claims against Nike. As an initial matter, the court says that Nike’s privacy policy does not undermine plaintiff’s claims. The operative policy was not fully authenticated or property presented to the court, and the court declines to consider it. CIPA Claim: There’s a distinction between the “contents” of a communication (which trigger a claim) and “record information.” Nike argued that the communications at issue were in the latter category. The court disagrees:
However, the plaintiff’s victory is pyrrhic as to this claim. The court concludes that Nike was a party to the communications and therefore can’t be held liable for direct infringement. While the court dismisses the claim for direct liability against Nike, it declines to dismiss the claim against Nike for “aiding or enabling” FullStory’s wiretapping. The key question according to the court was whether FullStory is a party to the communication or an outsider. The court says FullStory does not become a participant to the conversation by virtue of having recorded it. While the case would be different if the communication were disclosed to FullStory after-the-fact, the fact that FullStory gained contemporaneous knowledge makes it a third party. Defendants argued that because the data was only shared with Nike (a participant), plaintiff’s allegations “would criminalize ubiquitous functions of websites,” but the court is not persuaded. Claim Based on Possession Sale or Manufacture of Eavesdropping Device: Section 635 of the California Penal Code prohibits the sale, possession, manufacture, sale (etc.) of an eavesdropping “device.” The complaint only alleges that Nike “possessed” FullStory’s code and did not sell or further distribute it. Citing TransUnion, the court says that this claim fails for Article III standing. While the result may be different in state court, the court says it’s bound by Article III standing limitations. Invasion of Privacy Under the California Constitution: The court rejects this claim:
In order to state a claim, the plaintiff must show that the defendant collected “intimate or sensitive” information or “disregarded consumers’ privacy choices.” ___ The dispute is reminiscent of In re: Pharmatrak from 20 years ago, and other website tracking/data leakage cases, such as those against Zynga and Facebook. It’s interesting to note that here, the third party was able to obtain access to payment information, but that doesn’t seem to have caught the court’s attention. It doesn’t appear that plaintiff asserted a claim under the CCPA, by way of California’s unfair competition statute. That’s telling, and perhaps speaks to the limited effectiveness of this claim, to the extent courts even recognize it as viable. It’s interesting that FullStory was dismissed on jurisdictional grounds and the claims directly asserted against Nike were also dismissed. It leaves only a derivative claim against Nike for the collection of information by FullStory. I wonder if that changes the operative standards for what plaintiff has to show and what this means for discovery of communications between FullStory and Nike. Note: Defendants have sought a stay pending resolution of Susan Johnson v. Blue Nile, Inc. (pending in the Ninth Circuit), or alternatively for leave to appeal the ruling. Case citation: Saleh v. Nike, Inc., et al., 2:20-cv-09581-FLA (RAOx) [pdf] Related posts: Judge Koh Puts the Kibosh on LinkedIn Referral ID Class Action — Low v. LinkedIn The Cookie Crumbles for Amazon Privacy Plaintiffs – Del Vecchio v. Amazon A Look at the Commercial Privacy Bill of Rights Act of 2011 Flash Cookies Lawsuit Tossed for Lack of Harm–La Court v. Specific Media Another Lawsuit over Flash Cookies Fails — Bose v. Interclick LinkedIn Beats Referrer URL Privacy Class Action on Article III Standing Grounds–Low v. LinkedIn The Cookie Crumbles for Amazon Privacy Plaintiffs – Del Vecchio v. Amazon Facebook and Zynga Privacy Litigation Dismissed With Prejudice [Catch up Post] The post Privacy Lawsuit Based on Website Tracking by Service Provider Trimmed appeared first on Technology & Marketing Law Blog. Privacy Lawsuit Based on Website Tracking by Service Provider Trimmed published first on https://immigrationlawyerfirm.weebly.com/ via Tumblr Privacy Lawsuit Based on Website Tracking by Service Provider Trimmed
(A reminder that Trump’s legal filings routinely make brain-meltingly stupid arguments. This one is no exception). Twitter’s TOS, which Trump agreed to in 2009 when he created his account, contains a mandatory venue clause. To get around this, Trump claimed he “is exempted from the forum selection clause because he was the sitting President at the time his Twitter account was suspended and was legally unable to accept the forum selection clause.” The court gently shreds this argument. It says that the “Court does not find, nor do the Plaintiffs cite to, any section of the code that prevents a federal actor from accepting a forum selection clause.” It also says that the Knight Institute v. Trump ruling had no bearing on venue selection (and, as usual, there’s irony in how Trump tries to turn a bad courtroom loss into something that benefits him). “For these reasons, the Court finds that Trump’s status as President of the United States does not exclude him from the requirements of the forum selection clause in Twitter’s Terms of Service.” The court could have listed other reasons to reject Trump’s argument, like Trump signed up for the account when he wasn’t a sitting president, he filed the case when he wasn’t a sitting president, and other plaintiffs on the complaint have never been president and thus cannot benefit from these arguments. Plus, yes, Trump literally takes the position that the rule of law doesn’t apply to him–even if it applies to “ordinary” Americans. And the odious idea that a government actor can force private publishers to carry their unwanted propaganda is the kind of “rule of law” we see in banana republics. The court goes on to explain why the venue clause is mandatory, not permissive, and why it covers Trump’s claims. This is not a hard case. As a last-ditch effort, Trump argues that he should benefit from the “consistent content moderation” requirement of Florida’s new social media censorship bill (another ironic claim, because he literally just argued that his forum selection situation should not be treated consistently with other users due to his presidential status, but whatever). That law can’t be applied retroactively, and it’s currently enjoined as unconstitutional, but the court rejects the argument on more mechanical grounds. Having established the enforceability of Twitter’s forum selection clause, the burden shifts to Trump to provide a public policy argument in favor of keeping the case in Florida. The court recaps Trump’s arguments:
Unsurprisingly, the court shuts these arguments down:
Plaintiffs always lose must-carry lawsuits, and Trump’s arguments give no reason believe that he will become the exception to the dozens of failed cases that preceded this case. That prediction grows increasingly likely watching how easily the courts breeze through Trump’s attempts to fight the mandatory venue clauses. Recently, Trump filed a preliminary injunction motion in this case while the venue transfer motion was pending. I’m not sure about litigation etiquette, but to me, Trump’s move seemed to be premature, ill-advised, or bad form. I didn’t blog the motion in part because I wasn’t sure if the court would ever hear it in its current form. (Of course, Mike Masnick blogged it at Techdirt). After all, with the venue switch, the Ninth Circuit caselaw will become more relevant than the 11th Circuit caselaw. Now, the plaintiffs ought to redo their preliminary injunction motion to reflect the revised precedent. Case citation: Trump v. Twitter, Inc., 1:21-cv-22441-RNS (S.D. Fla. Oct. 26, 2021) The post Trump’s Must-Carry Lawsuit Against Twitter Moved to Twitter’s Home Court–Trump v. Twitter appeared first on Technology & Marketing Law Blog. Trump’s Must-Carry Lawsuit Against Twitter Moved to Twitter’s Home Court–Trump v. Twitter published first on https://immigrationlawyerfirm.weebly.com/ via Tumblr Trump’s Must-Carry Lawsuit Against Twitter Moved to Twitter’s Home Court–Trump v. Twitter ![]() The telematics car insurance discount will result in modest short-term savings. But giving your insurance company access to information about your driving and driving behaviors, it can also cause your insurance premiums to go up. It can also result in claims being later denied and your auto insurer even refusing to renew your policy. Buyer beware. For … Continue reading “Telematics Car Insurance Discount: Is It Worth It?” The post Telematics Car Insurance Discount: Is It Worth It? appeared first on Michigan Auto Law. Telematics Car Insurance Discount: Is It Worth It? published first on https://immigrationlawyerfirm.weebly.com/ via Tumblr Telematics Car Insurance Discount: Is It Worth It? In the DMCA, Congress enabled copyright owners to obtain pre-litigation discovery of alleged infringers (17 USC 512(h)). After sending a takedown notice, the copyright owner can apply for an unmasking subpoena, which the clerk of the court must issue without any discretion or review by a judge. This fast lane is a historical anachronism; it does little to balance the privacy interests of the alleged infringer. Knowing what we know now about the dangers of unmasking subpoenas, I would like to think that Congress would draft 512(h) with more privacy sensitivity today. 512(h) subpoenas rarely produce court opinions because the copyright owners get the subpoena automatically and the services usually automatically comply with the subpoena. This case is unusual because the Doe defendants attempted to quash the subpoena. The court rejects the Doe defendants’ efforts, and it gives us a little more insight about 512(h) along the way. The copyright owner is Julia Allison Baugher, an author. For unspecified reasons, bloggers reposted some of her works, including an 81 page book proposal, which included a 54 page manuscript draft, and 22 photos. The proposal, manuscript, and 2 photos were previously unpublished and not registered; the other 20 photos were covered by a copyright registration. She sent takedown notices to the blog’s “registrar” (this is the court’s word), GoDaddy, which GoDaddy honored. The bloggers did not submit counternotices. Baugher then submitted a request for a 512(h) subpoena, which the court clerk issued. It’s not clear how the bloggers learned of the subpoena, but they moved to quash it. The bloggers argued that the subpoena would violate their First Amendment right to speak anonymously. The court says that the First Amendment requires a balancing between the competing interests. Thus, the plaintiff has to show a prima facie case of copyright infringement before the subpoena can be upheld. Baugher easily established the prima facie case of 106 violations. The bloggers countered with fair use. The court doesn’t see it:
One of the reasons why unmasking subpoenas are so dangerous is that they can be used to impose extra-judicial consequences without any court oversight, such as terminating the employment or public shaming of the unmasked people. The DMCA says the subpoenaed information may be used only for copyright enforcement purposes, but there’s no practical way to enforce this, and I can’t think of anyone who has tried. Nevertheless, the court says the statutory limitation is good enough to address the bloggers’ fears of misuse, so the subpoena must be honored. Case citation: Baugher v. GoDaddy.com LLC, 2021 WL 4942658 (D. Ariz. Oct. 22, 2021) Some prior blog posts on 512(h):
The post Court Orders Unmasking Subpoena of Alleged Infringers–Baugher v. GoDaddy appeared first on Technology & Marketing Law Blog. Court Orders Unmasking Subpoena of Alleged Infringers–Baugher v. GoDaddy published first on https://immigrationlawyerfirm.weebly.com/ via Tumblr Court Orders Unmasking Subpoena of Alleged Infringers–Baugher v. GoDaddy When it comes to promoting his math tutoring services, Taiwanese math teacher Changsu knows all the right angles. Figuring that the probability of reaching more students would increase proportionately to the size of his audience, Changsu posted 200 calculus lessons on Pornhub, reasoning that: Since very few people teach math on adult video platforms, and… via Tumblr Why Lawyers Should Offer CLE on Porn Hub and Not Legal Providers This case involves the Peloton treadmill (“Tread+”). The treadmill has caused numerous personal injuries, and Peloton has recalled it. In this case, a 3 year old boy suffered personal injuries due to a Tread+ his dad bought. The dad, mom, and child sued Peloton for negligence and misrepresentation. Peloton invoked the arbitration clause in its TOS. The court’s resolution likely satisfies no one. The Dad
The specific evidence Peloton introduced of its TOS formation:
The court overrules the plaintiffs’ objections to this evidence. It’s a reminder that you must consider how you will introduce evidence of contract formation in addition to worrying about the contract terms and formation process. The court discusses another topic I don’t often see discussed. The Federal Arbitration Act applies only to interstate commerce. “To the extent the contract pertains to use of Peloton’s Services (e.g., its app, website, and on-demand fitness classes), because those services require use of the Internet, the Agreement would involve interstate commerce.” The Mom and Son Peloton tries to bind the mom and son to the TOS via “equitable estoppel.” The idea is that sometimes nonsignatories get benefits from a contract sufficient to impose the contract terms on them anyways. But not in this case. The son son is 3 years old. He lacks capacity to agree to the TOS, and he could disaffirm it even if he did. He got no benefits from the treadmill. Peloton’s TOS expressly restricted use by minors, and the 3 year old never used it. The story is the same for the wife: “Mrs. Stern never used the Tread+, nor did she benefit from it.” Thus, the nonparties cannot be swept into the contract. The court distinguishes the Nicosia v. Amazon and Tice v. Amazon rulings; but the result is consistent with the uncited BF v. Amazon case. Consequences Abstracting from the nuances, the court’s ruling is obvious. Peloton can’t bind parties not in privity to the terms of its contract. That’s Contracts Law 101. Still, the consequences can be pretty significant in the IoT era. Many products can affect the rights of home residents and visitors who aren’t in privity, like voice-command and surreptitious video devices. This ruling reinforces the unlikelihood that the device manufacturer can reach those parties with its TOS–in some cases, raising questions about the devices’ permissibility under existing law. In terms of this lawsuit, the dad’s case goes to arbitration but the wife and son’s cases remain in court. The dad signaled that he plans to challenge the arbitrability of his claims, so it’s possible the arbitrator will decide that the claims are outside the arbitration scope and bounce the dad’s case back to court as well. Another possibility is that the family decides to drop the dad’s claims altogether because the bulk of the case’s value likely rests in the son’s claims. Otherwise, the parties are in a Mexican standoff. The family can proceed with the full set of claims only by litigating in two venues, which doubles the litigation costs for both sides and creates a risk of inconsistent judgments. Both sides would benefit from merging the cases back into one, but someone has to concede, and neither party has an incentive to do so. Another possibility would be to stay one case–likely the arbitration–until the resolution of the other cases to see what happens and decide if the second case is worth pursuing. Either way, the court’s “split the baby” decision (see what I did there? or too soon?) on arbitration was potentially a bummer for both parties. Case citation: S.S. v. Peloton Interactive, Inc., 2021 WL 4711675 (S.D. Cal. Oct. 7, 2021). Note: my wife is a big Peloton fan, and we own some stock in the company. The post Peloton Can’t Bind All Family Members To Its Arbitration Provision–SS v. Peloton appeared first on Technology & Marketing Law Blog. Peloton Can’t Bind All Family Members To Its Arbitration Provision–SS v. Peloton published first on https://immigrationlawyerfirm.weebly.com/ via Tumblr Peloton Can’t Bind All Family Members To Its Arbitration Provision–SS v. Peloton I’ve blogged some recent cases showing how it’s become really, really hard to win defamation cases over social media content (e.g., Rapaport v. Barstool). Still, online defamation claims can succeed, as this case shows. But even if the plaintiff wins in court, does it truly win? * * * The court summarizes the facts:
The Facebook post: If you can’t read the text, it says:
(This transcription is from the opinion. Notice how the court omitted any reference to the fire emoji. ![]() The post went viral; it received over 36,000 shares and thousands of comments. Unsurprisingly, it’s offline now. Steak N Shake wasn’t pleased with this post, and it sued White for defamation. The case went to a jury. The jury found for Steak N Shake and awarded $70,000 in compensatory damages and $10,000 in punitive damages. Last week, the court denied White’s requests for post-trial relief. The court shows little interest in overriding the jury’s determinations. I think Steak N Shake’s decision to sue was an interesting one. Unquestionably, White’s post was very damaging to it. According to the court, “Steak N Shake presented evidence of a multitude of Facebook comments from numerous members of the public, many declaring that they will never eat at Steak N Shake again or that they thought Steak N Shake was ‘gross’ and ‘disgusting.‘” (Pro-tip: you could logically reach those conclusions about Steak N Shake even if their food is 100% maggot-free). Further, Steak N Shake presented evidence it lost $755k in sales. So surely the jury ruling vindicates Steak N Shake’s position and increases consumer confidence that its meat is actually maggot-free. In particular, the punitive damages signal that the jury thought White’s mistakes weren’t innocent. Yet, did Steak N Shake actually accomplish any of its goals? The damages award won’t affect its bottom line–and of course Steak N Shake won’t collect much, if any, of it (“Steak N Shake’s counsel even acknowledged in its closing argument that White likely did not have the financial resources to pay a large judgment”). The media coverage of this ruling will not come close to reaching the audience that White’s post did; as the old saying goes, “a lie can travel halfway around the world while the truth is still putting on its shoes.” So did Steak N Shake accomplish its goals? Whether or not Steak N Shake’s food is in fact infested with bugs, today is another good day to choose to eat less meat and switch to plant-based options. On that front, Steak N Shake isn’t a venue of choice. Case citation: Steak N Shake, Inc. v. White, 2021 WL 4819592 (E.D. Mo. Oct. 14, 2021) The post Social Media Is Often a Defamation-Free Zone…But Not Always–Steak N Shake v. White appeared first on Technology & Marketing Law Blog. Social Media Is Often a Defamation-Free Zone…But Not Always–Steak N Shake v. White published first on https://immigrationlawyerfirm.weebly.com/ via Tumblr Social Media Is Often a Defamation-Free Zone…But Not Always–Steak N Shake v. White |
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