Does Amazon’s Arbitration Clause Bar its Own Suit Against 1114 Anonymous Reviewers?
Late last week Amazon filed a lawsuit against a thousand plus members of the Fiverr marketplace who were selling fake Amazon reviews. The theory behind the case is that all of the reviewers are also Amazon customers, and are thus barred by Amazon ToS from taking money for the reviews. So Amazon has filed a suit against 1,114 John Does, and plans to subpoena Fiverr to identify them.
The facts of the case are easy to understand, but there could be a problem with the premise. On Tuesday Paul Levy of the Consumer Law and Public Policy blog has noticed that:
… there is a mandatory arbitration clause in Amazon’s Terms of Service, requiring arbitration of "Any dispute or claim relating in any way to your use of any Amazon Service, or to any products or services sold or distributed by Amazon or through Amazon.com." The clause is unconditional and two-way — it does not purport to bind only Amazon’s users. And what Internet Service Provider will honor a letter from an arbitrator asking it to provide documents or information identifying its users?
So is this a problem, do you think?
In a word, no.
While Levy is right about the arbitration clause, he neglected to consider the standard escape clause found in most ToS. This is the clause that lets one party essentially rewrite the contract at will, and in the case of Amazon it reads:
We reserve the right to make changes to our site, policies, Service Terms, and these Conditions of Use at any time. If any of these conditions shall be deemed invalid, void, or for any reason unenforceable, that condition shall be deemed severable and shall not affect the validity and enforceability of any remaining condition.
Since Amazon can’t identify the review sellers, it can’t take them into arbitration. And since that clause is unenforceable, Amazon is pursuing legal remedies.
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