Fraud, terms of service and email marketing


gavelHere at the Atkins house we’re still both recovering from the M3AAWG plague. I don’t know what it was that we shared during the conference, but it’s knocked many folks over. I don’t have a lot to blog about this afternoon so I was looking through some of my old blog posts to get at least some content up before I give up for the weekend.
I found an old post about permission (Permission: It May Not Be What You Think It Is). The post discusses where a woman sued Toyota over emails from an online marketing campaign. I’d totally forgotten about that blog post, so I started looking at what happened with the case.
In the original case Toyota created a social media campaign where people could opt their friends in to be the target of a prank.

In the prank, a friend would sign you up on the Toyota Matrix website to participate and provide Toyota with a slew of your personal and private information including your email (sound fun so far?). iMediaConnection

After your “friend” signed you up, you’d receive an email offering a free personality test. Part of the personality test involved agreeing to terms and conditions that, according to the Appeals Court, said:

The first paragraph of the terms and conditions states, “You have been invited by someone who has indicated that he/she knows you to participate in Your Other You. Your Other You is a website provided by [Toyota] that offers you . . . an interactive experience.” The second paragraph further states, “If you review and agree to the Terms and Conditions detailed below . . . you may participate in a 5 day digital experience through Your Other You. . . . You may receive email messages, phone calls and/or text messages during the 5-day experience.” A subsequent paragraph also states, “You understand that by agreeing to these Terms, you are agreeing to receive emails, phone calls and text messages from Toyota during the 5-day experience of Your Other You.” CA Court of Appeals

Toyota was sued for $10 million dollars by a woman who received the emails. The suit alleges intentional infliction of emotional distress, deceptive trade practices and negligent misrepresentation. The campaign was thorough, Toyota went so far as to create MySpace pages for the fugitive and send the plaintiff a bill for damages at a hotel.
Toyota argued to the court that the case go to arbitration as defined in the terms of service that the plaintiff agreed to. This went up to the California court of appeals, who ruled that the case did not have to
In 2011, the California court of appeals ruled the suit could go forward(pdf link) in the courts as the terms of service were void because they were drafted in such a way as to hide the true nature of the agreement from anyone clicking through.

[Plaintiff] contends that the arbitration provision in the terms and conditions is unenforceable because, assuming that she did agree to the terms and conditions by clicking the appropriate box, the entire agreement is void because of fraud in the inception or execution. We agree. […] The point that defendants fail to address, however, is that it would have availed [the plaintiff] nothing to read and reread the terms and conditions, which were drafted in such a way as not to apprise her of what defendants intended to do to her.

I’ve not been able to find any current disposition of the case, but I think the appeal ruling is interesting. One thing I hear from a lot of folks is how users opted in to have their address sold. But whenever I’ve had the chance to look at terms and conditions, there isn’t anything that says “We will sell your address.” Instead, I may find “we may share information with affiliated companies.” I don’t think it quite rises to the level of deception in Toyota’s terms. However, there is case law in California that says fraud in online terms can invalidate the whole agreement.

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