Friday, April 18, 2014

Does Liking a Brand Void Your Right to Sue?

The New York Times has an interesting article on a new twist on mandatory arbitration. General Mills has added language to its website that claims that consumers give up their right to sue the company if they download coupons, “join” it in online communities like Facebook, enter a company-sponsored sweepstakes or contest or interact with it in a variety of other ways. Instead, anyone who has received anything that could be construed as a benefit and who then has a dispute with the company over its products will have to use informal negotiation via email or go through arbitration to seek relief, according to the new terms posted on its site.

It is hard to imagine how General Mills thought this was going to be successful, and why it decided to risk the wrath of consumers with an unenforceable arbitration "agreement." A basic principle of arbitration law is that in order to force someone to arbitrate there needs to be a valid and binding agreement to do so. While there are any number of ways to create that agreement, or for the law to find that such an agreement exists, Mrs. Jone's purchase of a box of Betty Crocker cake mix is not one of the
"Liking" their Facebook page won't ring the arbitration bell either.
The ADR Professor Blog has commentary on the clause, and has the full text of the arbitration clause at their site.

When ‘Liking’ a Brand Online Voids the Right to Sue 
The attorneys at Sallah Astarita & Cox include veteran securities litigators and former SEC Enforcement Attorneys. We have decades of experience in securities litigation matters, including securities arbitration. Mark Astarita has represented parties in over 600 securities arbitrations, has litigated motions to compel arbitrations in the state and federal courts.  For more information contact Mark Astarita at 212-509-6544 or email us.