29 July, 2007
Interesting Ruling Regarding "Web Contracts"
(via Boing Boing)
The 9th Circuit Court of Appeals has ruled that
companies cannot change their contracts ("Terms of Service" in Web-Speak) without notifying their customers first.
The case that came before the Court of Appeals involved a customer who had signed up for telephone service with AOL. When the service was acquired by TalkAmerica they changed the Terms of Service. Although the changes were posted on their Web site, the customer, Joe Douglas, was not notified about this change prior to it taking place. Douglas, unaware of any changes, continued using the service for several more years (show of hands here, who among you periodically reviews the TOS for every Web service you use? Yeah, thought so.):
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When Douglas became aware of the new charges [he] sued in federal court in California, charging Talk America with violating the Federal Communications Act, breach of contract as well as other California consumer protection laws.
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One of the changes to the TOS was to force customers into arbitration, which TalkAmerica got a court to do in this case. When Douglas brought the case to the federal appeals court, they basically told TalkAmerica to go pound salt.
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The court said that because a contract was an agreement between two parties, one of the parties couldn't change it unless the other party agreed to the change.
..."Even if Douglas had visited Talk America's Web site to pay his bills, he would have had no reason to look at the contract posted there," the court said. "Parties to a contract have no obligation to check the terms on a periodic basis to learn whether they have been changed by the other side."
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This has some interesting--and serious--implications. Consider the recent censorship brouhaha at Flickr. They did indeed amend their TOS to reflect the fact that people in Germany and parts of Asia could only view Flickr in SafeSearch mode (I believe in Germany that has changed to where they can now view in SafeSearch Moderate). A lot of the tempest arose from the fact that Flickr did NOT notify users of this change (either by email or on the home page or Flickr Blog) prior to it happening.
Now, in the case of Joe Douglas v. TalkAmerica, this means that Mr. Douglas (and others in the class action lawsuit he's bringing) are not bound by the new TOS,--including the price increase--which, presumably, means they will receive some sort of compensation for overpayment. I'm not sure exactly how this would play out in Flickr's case, whether Flickr would be legally bound to refund the Pro accounts for users who could no longer use the service in the way they were accustomed to (Flickr's refund policy is, basically, NO refunds) or if they would be compelled to otherwise compensate affected users.
It'll be an interesting story to follow.
Labels: censorship, flickr, in the news
~~ victoria on 8:43 PM ~~ 0 comments
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