128

This is an addendum to our announcement about a recent ToS update concerning Stack Overflow For Teams and GDPR; I'm starting a separate discussion because concerns about the third bullet, an introduction of an arbitration clause, has caused consternation to rise to a level that we quite frankly didn't anticipate.

We didn't mean to scare anyone, had we realized this would be so controversial, we would have looked to see if we could implement the clause a bit differently. We included a means to opt-out, but didn't realize that many would find the mechanics in order to do it cumbersome. We get it.

Currently, we are working with our lawyers to see if we can implement a secure method of opting out electronically, and we'll update this post which will be linked to the main announcement as soon as we have more information.

This isn't a spot that we (or I'm certain any of you) enjoy being in, and we really appreciate how respectful and purposeful the negative reaction to the update has been. I don't yet have a timetable on how soon I can update this, I can only say that we're working on it right now, and that it's a pretty major priority.

I'll keep my ear to the ground as I continue to play with plaster while patching the forehead-shaped depression in my office wall, and update this post as soon as possible.

If you have thoughts that you think could help, or things you'd like me to bring to the discussions we're having (in addition to what was said in the original discussion) - please let me know in an answer or comments.

Thank you again for your patience and consideration.

The update is here: Electronic opt-out, correcting miscommunication, and additional questions answered about the 2018 ToS update

  • 169
    It might help to give a justification for why this is necessary at all. The opt-out is a workaround, and doesn't really fix the underlying issue. – Mad Scientist May 3 '18 at 15:09
  • 98
    It would be interesting to understand the rational behind adding the arbitration clause in the first place. Why did someone think that it was necessary when there hasn't been something like it for the almost 10 years of existence of the site? – Thomas Owens May 3 '18 at 15:09
  • 54
    COULD YOU MAKE THE CLAUSE LESS SHOUTY? – Won't May 3 '18 at 15:31
  • 79
    @Won't I'LL SEE WHAT I CAN DO OKAY BUT THEY ARE LAWYERS AND WHEN YOU BECOME ONE THE GOVERNMENT TURNS ON YOUR CAPS LOCK KEY AND IT BECOMES LIKE A SOBRIETY TEST TO START YOUR CAR THEY CAN'T USE THEIR COMPUTER WITHOUT IT ON. – Tim Post May 3 '18 at 15:36
  • 37
    LOOK I DON'T WANT TO KEEP THIS GOING BUT WHEN YOU GET ONE (1) LAWYER INVOLVED ITS LIKE RABBITS AND THEN THERE ARE THREE (3) AND AFTER A LONG ENOUGH TIME YOU HAVE TO BE ALL SHOUTY TO BE HEARD. LAWYERS. NOT EVEN ONCE. – Won't May 3 '18 at 15:51
  • 26
    I think you meant (1) ONCE, @Won't. – Tim Post May 3 '18 at 15:53
  • 41
    Pretty sure you need two rabbits to set the rabbitpocalypse in motion. Remember, always keep your lawyers well-separated and make sure they can't jump or dig under the fences. – Monica Cellio May 3 '18 at 15:54
  • 40
    @TimPost I really don't want to go on a rant in comments (I've seen it happening enough already), but the fact that including "As a user, you give up all rights to fair treatment" in the ToS wasn't considered 'controversial' is mind-blowing to me. It really shows the mentality of the people who run this place. – GreySage May 3 '18 at 16:11
  • 48
    While it is great that it's being re-examined - the original mentioned a 30 day window to opt-out, which is ticking down for people as we speak. Is that window still in effect because of the TOS update? Or can people safely assume that it is, for all intents and purposes, "on hold" until it's reexamined and whatever sort of new clause (if any) is put in place? – Ash May 3 '18 at 16:32
  • 32
    And...while SE may not have bad intentions at all, you must be aware that SE could be bought by Vampire Inc. at a later timepoint which abuses those clauses for own profit. – Thorsten S. May 3 '18 at 16:33
  • 31
    @TimPost I think we all appreciate and thank you for volunteering to be the wheat between two grinding stones ;-) – Thorsten S. May 3 '18 at 16:47
  • 46
    Just going to pile in on the side of arbitration clauses are inherently predatory. It means that 1000 people with $50 each can't pool their money to hire a single lawyer for the 250 billable hours it takes to handle a lawsuit. Instead everything is individual: each of those 1000 people have to pony up the 50-grand. Seriously, Where the parties on either side are **very numerous**, and cannot, without manifest inconvenience and oppressive delays in the suit... The whole point is to reduce cost and expedite the process. – Draco18s May 3 '18 at 21:20
  • 37
    Update, folks, I expect to have another response out in the next few hours. Depending on the time, it might need to wait until Monday because I don't want to just drop something like that here just before leaving, and I fully intend to be offline all weekend. – Tim Post May 4 '18 at 16:19
  • 39
    It's monday. I'm getting curious. Time for the USA to wake up. – Tschallacka May 7 '18 at 8:04
  • 40
    Now it's Tuesday and there was no update. Now i'm even more curious. @TimPost any updates or progress reports? Will the response come within 6-8 hours/days/weeks/months? – Tschallacka May 8 '18 at 7:37

12 Answers 12

346

I'm going to repeat and expand upon what I said over on the other post:

Arbitration clauses in clickwrap terms-of-service contracts are inherently abusive. An opt-out is not good enough. You should not have this clause at all in the terms of service applied to the general public. (I don't care whether you put it in the default terms of service for Teams, or for employers seeking to use the Careers service, since I presume that those remain negotiable in advance by actual lawyers on both sides.)

The practical function of an arbitration clause in a clickwrap terms of service document is to immunize the company (Stack Exchange, in this case) from class-action lawsuits. Given that all community use of the SE website family involves no money changing hands either way, the only reason we should expect anyone to file a class-action lawsuit against Stack Exchange is if you commit some sort of massive privacy violation or copyright infringement. I imagine you would never do such a thing, yes? But then you have no reason to need an arbitration clause, yes? So you should be willing to take it out, yes?

And if you're not willing to take it out, why should I believe your assurances that you will never sell all our private data to scammers?

  • 8
    To be fair, "commit some sort of massive privacy violation" is a thing that can happen through no fault of their own, due to hackers and the like. – Nicol Bolas May 3 '18 at 16:31
  • 106
    @NicolBolas Yes, but if it really was through no fault of their own and they respond to the breach in a sensible and honest manner, they still shouldn't be afraid of its leading to a class-action lawsuit. Conversely, if there's, I dunno, a blatant SQL injection bug that makes it possible to dump the user database, then that would be their own negligence and we ought to be able to sue over that — the legal system is supposed to raise the cost of negligence, so that companies are Motivated™ to not be negligent. – zwol May 3 '18 at 16:37
  • 21
    Would you really want to bet the survival of your company on what 12 random people think is and is not negligent with regard to things that they have no real foundation of knowledge in? I don't agree with arbitration clauses; I think they should be legally outlawed. But when you still get class action lawsuits even when you are "sensible and honest" (it may have been dismissed, but it wasn't free to get it dismissed), maybe there's a problem. – Nicol Bolas May 3 '18 at 17:08
  • 11
    Well, your argument 'no one will initiate class-action lawsuit anyway' is not convincing. The reason for someone to initiate class-action lawsuit is that someone simply is a lawyer who does this all the time. – artem May 3 '18 at 17:23
  • 1
    @NicolBolas, in the real world, class-action lawsuits are resolved either in the pre-trial phase or the appeals court, simply because it's so easy to sway those 12 random people with "something bad happened, here's a target to vent your outrage on". – Mark May 3 '18 at 23:23
  • 84
    Note that "they" might be a company which buys up Stack Exchange Inc 10 years down the road, or new management which may be far more corrupt. I don't think SE is actively thinking about screwing us over, but they are making it a possibility for them to do so in the future with minimal repercussions. – forest May 4 '18 at 1:39
  • 11
    @zwol While I agree with you that they should not have an arbitration clause in the general ToS, this post's reasoning kind of sounds like "why are you afraid of police searches if you have nothing to hide" argument. A class-action protection clause has the benefit of protecting them from any class-action lawsuit for any reason, especially the unforeseen ones. It's not just a shield against privacy violation-based class-action lawsuits and nothing else. – TylerH May 4 '18 at 13:42
  • 2
    This is a bit incorrect. Arbitration doesn't mean "no class actions". You can specify in the contract the the user waives his class action rights even without arbitration; likewise, there can be class arbitrations, though this generally needs to be explicit in the arbitration agreements or there needs somehow to be a background rule supporting the interpretation that such class arbitration is permitted. – Artefacto May 5 '18 at 0:46
  • 8
    I seem to recall a few cases of sloppy use of personal information. One was associating a random profile with an audit question on review audits so that people didn't merely base closing on rep. Another involved displaying profiles of people on job ads, "you could be working with ____". Apparently, the person didn't work there after all. Maybe they left, maybe it was random, I don't know. In either case, it is not clear what users involved would say. I know about these two cases because someone spoke up on meta and said "that's weird." but I can imagine more negative responses. – Paul May 6 '18 at 11:53
  • Copyright infringement? meta.stackexchange.com/q/333089/357051 – Andreas -he-her- 2 days ago
170

You wrote in the original announcement

Arbitration is pretty standard for free online products, [...]

While forced arbitration agreements seem to be increasingly popular in the US, I don't think they're as common as this sentence seems to imply. I checked a few Terms of Service for products that match this description (the first popular ones that came to mind, not truly a random selection):

No arbitration clause:

  • Twitter
  • Github
  • Reddit
  • Slack
  • Google
  • Facebook
  • Wikipedia

Arbitration clause:

  • Gitlab (arbitration in the Netherlands)
  • Instagram

My selection is certainly not random, but it does at least indicate that arbitration isn't universal for free online products. So I am wondering why SE does suddenly need it, and many other online services manage to do fine without it.

  • 47
    By the way, for those who may find articles about Slack requiring arbitration: their arbitration clause was removed in 2016. – Sonic the Anonymous Hedgehog May 5 '18 at 2:11
  • 20
    Just checked: all Wikimedia Foundation projects also lack arbitration clauses, as do YouTube and Facebook. – Sean May 7 '18 at 2:42
  • 2
    For more examples of bad clauses, see tosdr.org/topics.html#jurisdiction-law tosdr.org/topics.html#waiver – Nemo May 7 '18 at 15:33
  • 7
    Even if they're common, that doesn't mean it's right. Thus, how common it may be is irrelevant. – code_dredd May 7 '18 at 22:14
  • 2
    @ray It may be irrelevant in a discussion of the ethics of the clause itself, but this answer brings up the possibility that, on top of introducing a potentially unethical change to their ToS, SE is being disingenuous in their presentation of said change. That seems highly relevant to the discussion at large. – jmbpiano May 9 '18 at 18:32
  • 1
    @jmbpiano You're right. I mean it in the sense that, from what I've seen, company/legal logic usually follows the "it's common/popular, therefore it's moral/right", which is the absurdity I was trying to point out. Even if it weren't a moral problem, it'd still be fallacious by begging the question, among other things. – code_dredd May 9 '18 at 18:38
123

I have no plans to sue SE, but I'm very concerned that the new TOS attempts to apply the arbitration clause to "ALL DISPUTES BETWEEN YOU AND STACK OVERFLOW", no matter who initiated the dispute or who is demanding something from the other side.

By its plain meaning, this would allow SE to suddenly decide they want money from me and sue me on some trumped-up charges in their own private court, knowing that it would be cheaper for me to roll over and pay up than to hire an American lawyer to defend me (and that is assuming I could even get a fair hearing in a forum that SE has unilaterally selected, which I doubt).

It would be a lot more palatable (at least to me; can't speak for others) if the clause only covered disputes where I demand something from SE.

  • 4
    This is actually a common rule, and enforced by many arbitration organizations. Can't blame SE for that one. – MSalters May 3 '18 at 15:23
  • 44
    @MSalters: Of course the private kangaroo courts will "enforce" rules that allow their clients (i.e. SE) to fleece hapless users legally. That's just their business model, but I don't see how that should make me feel any better about being targeted with such a threat. – Henning Makholm May 3 '18 at 15:24
  • 13
    Well, it's especially profitable for the arbiter as they get they hundreds of $$$ just for saying "yes you owe SE an excuse". This is exactly why you want to opt out of such a clause. – yo' May 3 '18 at 15:29
  • 1
    @HenningMakholm: Looks like the chosen ADR company (JAMS) is actually a quite reasonable choice. – MSalters May 3 '18 at 15:35
  • 2
    @MSalters: You're free to think that, of course. – Henning Makholm May 3 '18 at 15:35
  • 2
    @yo': To be fair, that still beats a $1000 bill from a real court. Keep in mind that the legal process isn't the most efficient, and the process parties are paying for that. – MSalters May 3 '18 at 15:37
  • 15
    @MSalters: A real court in my location will bill the plaintiff of a frivolous suit, and order them to pay the defendant's costs too. – Henning Makholm May 3 '18 at 15:38
  • 26
    Note that while we (as users) waive our right to sue, SO does NOT if they really want to. Also, even if we take our case to arbitration and win, the arbitrator is unable to award us any damages. – GreySage May 3 '18 at 15:43
  • 8
    @user2357112: I don't care if their bullying threats are because they choose to do business with someone who "requires them" to make bullying threats towards me. And I also don't care that I don't have to pay the kangaroo court's fees after it signs over my fortune to SE. – Henning Makholm May 3 '18 at 20:07
  • 8
    @user2357112: Denmark is not the US. I'm fine with them giving users the option of being sued in their arbitration court instead of a real one if they so choose, but to require everyone to preemptively sign away their right to be sued in a real court is noxious. – Henning Makholm May 3 '18 at 20:15
  • 34
    @user2357112: Again, legal fees is not what I'm concerned about. I'm concerned about being ruined by SE suing me for a fortune in a mock court thousands kilometers from me, conducting business in a language that's not mine, in a legal background that's not mine, with a mock judge whose salary is paid by SE, who is interested in their repeat business and therefore has a strong incentive to bluestamp whatever SE demands, with no appeal. Why would one worry about fees in that scenario? – Henning Makholm May 3 '18 at 20:20
  • 26
    @user2357112: Still a mock court, paid and selected by SE, interested in keeping SE as their client, with absolutely no reason to rule against their paying client, and with no appeal or review. If you want to prefer that in comparison to a real, impartial court with a tenured judge where the victim has a fighting chance, that's your matter, but count me out. – Henning Makholm May 3 '18 at 20:29
  • 17
    ... oh, and happening in secret too. – Henning Makholm May 3 '18 at 20:36
  • 2
    Are you mixing up browsewrap and clickwrap? Browsewrap may be unenforceable, but everything I can find indicates that clickwrap is quite enforceable - and yes, that includes in Denmark. – user2357112 May 4 '18 at 0:12
  • 2
    I don't know about the US or Denmark, but in England & Wales (the jurisdiction I am familiar with), it is possible to appeal a mandatory arbitration in the courts if it is not "according to the rules of natural justice" - which means your concern about "suing on some trumped-up [claims] in their own private court" has a remedy. (Legal pedantry: "charges" are what happens in a criminal court; "claims" are civil courts.) – Martin Bonner May 4 '18 at 11:38
104

Along with the mandatory arbitration clause, the new Terms of Service would seem to have a mandatory gag order about any and all arbitration cases:

You agree that, notwithstanding anything in the foregoing, any arbitration proceeding between you and us will be conducted in New York, NY, USA, that the language of the arbitration shall be in English, and that all arbitration proceedings shall be considered confidential in nature.

Hypothetically, if at some time in the future, Stack Overflow were taken over by less ethical management who decide to start slapping users with arbitration cases for revenue-related reasons, does this mean we won't even be able to warn other users about it? Recently mandatory confidentiality clauses associated with mandatory arbitration clauses have been in the news for helping to enable harassment (example 1, example 2, example 3), which shows one way that the mandatory arbitration + confidentiality pairing can be used in predatory ways. And of course forced secrecy cuts against the Stack Exchange network's current culture of openness and mission to provide answers to all sorts of questions.

What is the justification for this mandatory confidentiality order, especially in hypothetical future cases where the Stack Exchange network (or its successors) brings action against an end user, rather than vice versa?

  • 8
    Good eye. If such things would happen I'd ditch Stack Overflow like a brick. – Tschallacka May 7 '18 at 11:49
  • 34
    @Tschallacka Yes, but you wouldn't know that such things were happening (thanks to the confidentiality part). – GreySage May 7 '18 at 20:42
  • 4
    Wow, this one smells sketch... – Mehrdad May 11 '18 at 10:41
90

I suspect the unilateral carve-out for IP violations in your arbitration clause may violate Jams's Consumer Arbitration Minimum Standards. The Consumer Arbitration Minimum Standards say that

  1. The arbitration agreement must be reciprocally binding on all parties such that (a) if a consumer is required to arbitrate his or her claims or all claims of a certain type, the company is so bound; and, (b) no party shall be precluded from seeking remedies in small claims court for disputes or claims within the scope of its jurisdiction.

Your arbitration clause says that

[...] TO THE EXTENT THAT YOU HAVE IN ANY MANNER VIOLATED OR THREATENED TO VIOLATE OUR INTELLECTUAL PROPERTY RIGHTS, WE MAY SEEK INJUNCTIVE OR OTHER APPROPRIATE RELIEF IN ANY STATE OR FEDERAL COURT IN THE STATE OF NEW YORK.

This lets you avoid arbitration in cases where we cannot. I am not sure whether the small claims alternative or some other clause makes this okay; the small claims alternative is limited, most obviously because small claims court can only handle small claims.

  • 1
    Good point. Although, to be fair, the copyleft enforcement lawsuits by SE on behalf of the user are mostly a benefit for the user, who individually would rarely have an option to sue. – Nemo May 4 '18 at 17:47
  • 5
    Yes, this is exactly what I was coming here to point out. "SO screws you over" - arbitration. "You screw SO over" - you're going to court. This isn't a good look for you, SO. – Kyralessa May 8 '18 at 15:49
81

The arbitration clause won't hold for any visitors from Europe.

http://www.privacy-regulation.eu/en/article-77-right-to-lodge-a-complaint-with-a-supervisory-authority-GDPR.htm

Without prejudice to any other administrative or judicial remedy, every data subject shall have the right to lodge a complaint with a supervisory authority, in particular in the Member State of his or her habitual residence, place of work or place of the alleged infringement if the data subject considers that the processing of personal data relating to him or her infringes this Regulation.

That's just for GDPR violations of course.

Also a TOS can never override local laws. When you serve European users you're subject to European laws and local country laws. Nothing will stop European users to complain to local authorities to lodge a complaint or to start a court case within Europe.

For example: https://www.reuters.com/article/us-eu-court-facebook-privacy/eu-court-rejects-facebook-class-action-suit-by-privacy-activist-idUSKBN1FD33U

Schrems said the ruling was a “huge blow” for Facebook as his individual lawsuit against the company could go ahead in a Vienna court and Facebook would have to explain whether “its business model is in line with stringent European privacy laws.”

emphasis mine

https://www.tomshardware.com/news/facebook-loses-belgium-privacy-lawsuit,36540.html

Facebook also tried to argue that its Terms of Service say that any Facebook user can only sue it in the United States. The courts disagreed and called Facebook’s policy “abusive.”

emphasis mine

So, those TOS terms about the arbitration will never fly for European users. So you should either add a clause that it will only apply for Non EU users, or drop it.

Dutch law even states(found thanks to the comment of Adriaan)

http://wetten.overheid.nl/BWBR0005289/2015-06-19#Boek6_Titeldeel5_Afdeling3_Artikel236

Bij een overeenkomst tussen een gebruiker en een wederpartij, natuurlijk persoon, die niet handelt in de uitoefening van een beroep of bedrijf, wordt als onredelijk bezwarend aangemerkt een in de algemene voorwaarden voorkomend beding
Translation and emphasis mine
In the event of an agreement between a user and a counterparty, natural person, who does not act in the exercise of a profession or business, an condition shall be deemed unjustly onerous when the the general terms and conditions includes one of the following stipulations.

Section N:

N) dat voorziet in de beslechting van een geschil door een ander dan de rechter die volgens de wet bevoegd zou zijn, tenzij het de wederpartij een termijn gunt van tenminste een maand nadat de gebruiker zich schriftelijk jegens haar op het beding heeft beroepen, om voor beslechting van het geschil door de volgens de wet bevoegde rechter te kiezen;
translation mine
N) this provides for the settlement of a dispute by a party other than the court that would be competent according to the law, unless it grants the other party a period of at least one month after the user has invoked the clause in writing to the clause, in order to settle the matter. to decide the dispute by the judge competent according to the law;

Section N sounds awfully lot like the arbitration clause, even up to the month opt out mentioned.

EDIT Additional comment from Adriaan that adds some details.

Note that Dutch law isn't explicitly against mandatory arbitration; you need the month opt-out after the start of the dispute and you have the right to an independent judge/arbiter. It can be picked by the sector as a whole, but not by SE only (source) So the arbitration clause as currently written isn't going to hold up, but is doesn't mean any form of an arbitration clause is illegal under Dutch law.

EDIT

From the article posted by Nemo in the comments

Link: https://www.duo.uio.no/bitstream/handle/10852/22949/thesis.pdf?sequence=2

It's a very interesting read that shows how consumer laws evolved within Europe. I highly suggest to read it. Very informative.
I'll do my best to give a summary of the most important bits highlighted in the article.

I really like the motivation given for providing consumer law. To protect the weaker party. To prevent the twisting of arms sort to say.

Page 13

The two aforementioned traditional principles of private international law (the principle of the proper law and the principle of the freedom of choice) are now complimented by the principle of “protection of the weaker party”33. The principle is based on the presumption that the parties to a consumer contract are not contractually and economically equal. That is why legislator considers it necessary to protect the weaker party by the rules of law (in particular, private international law). The rules which are more favorable to the weaker party than the general rules (for business to business relations) should apply.

Up unto about page 23 it talks about the old Rome convention, interesting but not relevant.

Then around page 23 it starts about the the Brussels convention giving even more protection to consumers than on the older laws mentioned before. Giving the consumer the right to choose in which country to go to court, after the dispute has risen. Some conditions apply, but a safe bet is the home state.

Page 23

The Brussels Regulation Article 17 deals with the choice of jurisdiction in consumer contracts. Thus, the parties can choose the jurisdiction other than indicated by the Article 16 only if it was agreed by the parties after the dispute has arisen, or if it allows the consumer to bring proceedings in courts other than those indicated in the Article 16 (i.e. gives the consumer more choices), or if the parties were domiciled or habitually resident in the same Member State at the time when the contract was concluded which confers jurisdiction to the courts of this Member State. Thus, the principle of the freedom of choice is limited in the Brussels Regulation. Particularly, the Brussels Regulation does not permit to deprive a consumer of the protection by choosing the jurisdiction outside the country of his domicile. In any case if the consumer contract satisfies the requirements of the Article 15 (1) (c) the consumer is entitled to refer to the court of his domicile.

And they made rules even stricter for to whom it applies. Basically if you target European consumers, you're in the club and have to play by the rules.

Page 24

Thus the consumer contract falls under the judicial protection of the Regulation if it “has been concluded with a person who pursues commercial or professional activities in the Member State of the consumer's domicile or, by any means, directs such activities to that Member State or to several States including that Member State, and the contract falls within the scope of such activities”

So basically anyone using Stack Overflow, from Europe, falls under the European consumer protections. This gets re-confirmed later on.

Page 37 about the improved Rome convention removes some ambuigities

Thus, a consumer contract: 1) is governed by the substantive law of consumer‟s habitual residence if choice of law hasn‟t been made by the parties; or 2) if the parties have chosen another law to regulate their contractual relations, this law applies, but the choice cannot deprive the consumer of the protection afforded to him by mandatory rules of the country where he has his habitual residence. Basically the double rule left completely unchanged from the Rome Convention

So Stack Overflow can say they want USA, but they can't force it to circumvent EU memberstate protections

Page 39 gives us this nice bit

Article 6 (1) (b) alternative requirement: The contract is concluded between the consumer and the professional who, by any means, directs professional or commercial activities to111 the country of consumer‟s residence or to several countries including this country and the contract falls within the scope of such activities.

Stack Overflow surely targets European users, directs activities to European markets. I would say this makes it binding to fall under the EU protections.

This confirmed on page 43

Thus the Proposal for the Brussels Regulation set the following cumulative criteria: 1) The site has to be interactive (consumers must at least have a possibility to enter into contract via this website); and 2) The site should be accessible in the state of consumer‟s domicile.

Stack Overflow would fall in the interactive category, making it subject to the laws.

An interesting article that with the bits quoted here, but also in full read, confirming that the arbitration clause is moot for European users.

EDIT, found some more stuff

I found this nice tidbit on the eurlex

COUNCIL DIRECTIVE 93/13/EEC of 5 April 1993 on unfair terms in consumer contracts

Got to love that title.

http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=CELEX:31993L0013:EN:HTML

Article 3

  1. A contractual term which has not been individually negotiated shall be regarded as unfair if, contrary to the requirement of good faith, it causes a significant imbalance in the parties' rights and obligations arising under the contract, to the detriment of the consumer.

  2. A term shall always be regarded as not individually negotiated where it has been drafted in advance and the consumer has therefore not been able to influence the substance of the term, particularly in the context of a pre-formulated standard contract.
    The fact that certain aspects of a term or one specific term have been individually negotiated shall not exclude the application of this Article to the rest of a contract if an overall assessment of the contract indicates that it is nevertheless a pre-formulated standard contract.
    Where any seller or supplier claims that a standard term has been individually negotiated, the burden of proof in this respect shall be incumbent on him.

  3. The Annex shall contain an indicative and non-exhaustive list of the terms which may be regarded as unfair.

ANNEX TERMS REFERRED TO IN ARTICLE 3 (3)

(q)
excluding or hindering the consumer's right to take legal action or exercise any other legal remedy, particularly by requiring the consumer to take disputes exclusively to arbitration not covered by legal provisions, unduly restricting the evidence available to him or imposing on him a burden of proof which, according to the applicable law, should lie with another party to the contract.

Then there is this interesting answer: How does SE's arbitration clause hold up under the GDPR?

But let your lawyers decide about this fun issue that spans multiple jurisdictions worldwide. Maybe let them read that article.

  • 1
    You might want to use better sources that news, e.g. commentary of the EU Court of Justice rulings. Some reading: duo.uio.no/bitstream/handle/10852/22949/thesis.pdf?sequence=2 – Nemo May 4 '18 at 17:45
  • 2
    I will read that. Its a lenthy document, will take some time. I'm not a lawyer, so i don't spend my free time reading court cases or know where to find them. – Tschallacka May 4 '18 at 19:22
  • 2
    Sure. It was just a suggestion to further improve the answer (which I already upvoted). – Nemo May 4 '18 at 20:07
  • 1
    Interesting read. Thanks again for sharing. Added it into the answer. Did it on mobile so there might be a few spelling errors. – Tschallacka May 4 '18 at 23:09
  • 2
    Note that Dutch law isn't explicitly against mandatory arbitration; you need the month opt-out after the start of the dispute and you have the right to an independent judge/arbiter. It can be picked by the sector as a whole, but not by SE only (source) So the arbitration clause as currently written isn't going to hold up, but is doesn't mean any form of an arbitration clause is illegal under Dutch law. – Adriaan May 6 '18 at 6:16
  • Ah. Thanks for the clarification. Mind if i add your comment in my answer? – Tschallacka May 6 '18 at 7:45
  • Will do remember. thanks for the heads up @Adriaan. – Tschallacka May 7 '18 at 11:46
  • 2
    What countries in Europe are currently accepting refugees from the United States? – Caleb May 7 '18 at 13:05
  • None. To be a refugee you'll have to prove that your life is basically in danger if you return. The states is not a warn torn country where you will be beheaded for the wrong religion or supporting the wrong side. The worst you get in the states is that that some kid shoots up a school or a guy builds a tank and demolishes half a town. That's live able. Also, read this – Tschallacka May 7 '18 at 13:09
  • 4
    This is going on my list as reason #2874 that I'm glad I moved to Europe. – Kyralessa May 8 '18 at 15:51
66

I don't know if asking a question here is ok but:

we would have looked to see if we could implement the clause a bit differently. We included a means to opt-out

Is there any reason a user would not want to opt-out? What does the user gain by giving up their right to participate in a class action?

And if they don't gain anything, wouldn't the best thing be to switch it to an opt-in, or just ditch the provision altogether?

The idea that users are giving up a right unless they happen to read the complete ToS when they sign up (which no one ever does), understand the implications for a situation which will probably never happen, and then actively take a legalistic step to make that happen seems absurd.

  • 69
    There is absolutely nothing a user would gain from not opting out. Stack Exchange Inc is relying on the fact that the overwhelming majority of users will not opt out and will thus waive their rights. – forest May 4 '18 at 1:36
  • 1
    Your last paragraph says that this "seems absurd", but this and other similarly-skewed legal provisions are not merely commonplace, but well-nigh ubiquitous in terms of service, EULAs, and the like. – Nathan Tuggy May 4 '18 at 10:06
  • 4
    read the complete ToS when they sign up is an important part, as apparently you need to opt-out within 30 days of registering (or 30 days since the release of the new ToS if you're an established user). Good thing Dutch law: BW 6:236 start and sub-n gives me, as a Dutch national, the right to (dis)agree to arbitration a month after a dispute starts. An opt-in wouldn't work for the same reason you mention: no one reads the ToS, and additionally arbitration is almost always detrimental to the claimer. – Adriaan May 4 '18 at 10:59
  • 5
    @NathanTuggy I've never seen anything like this before. Which isn't to say you're wrong, but maybe it's a US-specific thing? But more importantly, something being common is not an argument against its being absurd. – terdon May 4 '18 at 11:11
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    @terdon: I wouldn't be surprised at all if it's a US-specific thing; many agreements I've seen in the US have it (although not all by any means), while the agreement for Elite: Dangerous (which is based in the UK) does not. I don't have much experience with these agreements in other countries, though, so I have no way of telling if that's normal. – SilverWolf May 4 '18 at 12:41
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    @NathanTuggy Well to be fair every ToS and EULA is pretty absurd. – TylerH May 4 '18 at 13:44
25

Imho, adding a one-sided arbitration clause to the TOS is prima facie evidence that StackExchange management is now worse. It negates the goodwill I felt reading that you all were trying to be more 'inclusive'.

Perhaps the idea of being inclusive is not the same between us. To me, being inclusive and welcoming means, as a low baseline, that ordinary people do not have to fear lawyers at their backs.

As I understand it, SO 'owns' all the content I freely contribute. Due to that, they should never have a claim against me. Exactly how would I ever be the subject of a lawsuit? If I would be one, then why would I contribute content for which I don't keep access and ownership?

I think the lawyers have OVERREACHED [in their font face lol]. They wanted to add a TOS for the new service in which users contribute valuable private corporate data which needs to be protected. For that information, the companies that buy the service should sign agreements. I am still against arbitration, but at least [even small] companies are 'expected' to be deep pockets [which in itself is an evil supposition]. The supposition is then: if you are willing to pay $5/month/person then you are wealthy enough to pay $50k++ lawyering should you need it.

Please remove this arbitration clause asap. Thank you for listening to our remarks. Without this thread as forum and changes I would simply start looking more and more askance at SO, reduce usership, look elsewhere, and/or start my own.

  • "As I understand it, SO 'owns' all the content I freely contribute" I believe you are still the copyright holder, but regardless, the content is licensed under cc by-sa 3.0, so it can be used by anyone for free forever, as long as they credit you. – endolith May 21 '18 at 18:03
17

As a followup to David's post, concerning the sunset date for arbitration claims, I'd like to know whether the restriction is symmetric. From the new Terms:

b. Mandatory Arbitration
...
You agree that regardless of any statute or law to the contrary, any claim or cause of action arising out of, related to or connected with the use of the public Network or these Public Network Terms must be filed within one (1) year after such claim of action arose or be forever banned.

I understand this to mean that we cannot file an arbitration claim against Stack Overflow for something that happened more than one year in the past.

But, is the reverse true? Do Stack Overflow (or its successors) also agree that they cannot file a claim against us for our (mis)use of the Network more than one year in the past? Or could Stack Overflow file a claim against us for something we did at any time in the past?

  • 3
    Should this be another question? – dbc May 5 '18 at 22:42
  • 14
    So when data breaches happen, as long as they don't report it for a year, they're in the clear. – Theodore R. Smith May 7 '18 at 3:37
  • @TheodoreR.Smith- The new GDPR rules require data breaches to be reported within something like 72 hours, so I don't think they could do that here. Other offenses not covered by specific laws, probably so. – bta May 7 '18 at 22:45
7

Can I get some clarification on this part of the new Mandatory Arbitration clause?

This is the end of the first paragraph (the one where the Lawyers are yelling). Section 10. General Provisions subsection b. Mandatory Arbitration.

You agree that regardless of any statute or law to the contrary, any claim or cause of action arising out of, related to or connected with the use of the public Network or these Public Network Terms must be filed within one (1) year after such claim of action arose or be forever banned.

What is it that happens or be forever banned? Whenever I read "be forever banned." I get very curious, and very much want to know what not to do to get perma banned.

The way I see it now it says "any claim must be filed within one year of the thing happening, else you get banned."

Is that right? If so, why are we threatening legal tardiness with a ban for life? Is that a network wide ban?

(I know, a lot of questions for an answer)

  • 6
    They mean the claim is banned from arbitration, not you. It's like a statute of limitations. – dsolimano May 5 '18 at 3:26
  • 1
    OH! see I'm a mod, and when I see "ban" I'm thinking user ban. That makes so much more sense. – David May 5 '18 at 3:28
  • 4
    Does that sentence restrict Stack Overflow as well as end users? We have to agree that any arbitration action we bring has to be brought within a year, but does Stack Overflow also agree that it must act against us within a year? – dbc May 5 '18 at 17:29
-5

UPDATE: If this arbitration effort goes forward, on 1 June 2018, one day before the clause goes into effect, I will do the following:

  1. I will view StackExchange as a potential enemy of the movement toward more free societies.
  2. I will create an open source markdown repository on both GitHub and GitLab and on a site that I own containing all of my questions and answers for which I own the copyright to on Stack Exchange sites.
  3. I will delete all of my questions and answers on all Stack Exchange sites.
  4. I will open up the site for others to do the same. If I can find an API to automate this migration, i will do so, too.

We are hacktivists. We have legal abilities to effect the hands of tyrants. Don't forget that.


Let's say you are an active member on a site like StackOverflow, or worse, Facebook. I have a 10,000+ rep, so it's safe to say I'm in that category.

Now say that you have agreed to an Arbitration-only clause, or even the exact clause StackExchange wants us all to agree to.

NOW say that the site admins / developers do something REALLY STUPID (like store all your passwords in clear text in a semi-publicly-accessible log file (::cough:: Twitter). Or what if a dev does something down right evil, resulting in harassment, or even death, or something truly terrible, based on inside info (say, IP addresses) or gaming the system for employers, all sorts of stuff.

What if StackExchange decides to get in bed with a government agency, not even your own government agency, that wants to track and spy upon and collate the information EVERYONE who knows certain hacking techniques? Know about RIPS security software? They could do so for money, you know. Lots and lots of value in that information.

Well, as of right now, all of the affected could sue the company for, say, negligence in handling their stuff. A class action lawsuit would cost nothing to a mere handful of dollars, thus causing large sites, like Stack Exchange, to be very careful in their business dealings.

After you sign the arbitration clause? You're going to be going to a figurative kangaroo court, hand-picked (and stated in writing) by the Wrong Doer, that 80%+ of the time sides against the little man (you and I) because the Oppressor pays their bills.

Now, imagine if all these big sites had thought to add these clauses in their Agreements 10 years ago? Hell, we'd already be living in a dystopia! For sure!

If the max fine they could get slapped with is like $1,000, suddenly this "spying for the NSA" crap looks much more profitable. Maybe (certainly?) not for the current corporate owners, but it's one CEO-change away from becoming a reality, and do NOT THINK that this does not happen in other avenues.

StackExchange profiles EVERY DEVELOPER on the planet! Ethical hacktivists, biohackers, cryptocurrency developers (me), peer-2-peer innovators (me), secure communications developers (me), we are all systemic threats to The System and virtually every non-free government on Earth.

We cannot let the platform which we have all, monopolistically plied our questions and answers on, adopt this insane arbitration clause. At least not for non-Europeans.

Boycott arbitration clauses for EVERY site where you leave personal information or a way to catalogue and reference a high percentage of people in disruptive crafts. The last thing we want is for the arbitration virus to spread across all websites and all of our lesser intelligent, lesser aware, less awoke friends and family falling victim to them, and taking down society with them.

  • 21
    Just fyi, your #3 there isn't possible. You can't arbitrarily just delete all of your content from our network. You get blocked from deletions after like 10 in a day, and you'd probably get suspended by moderators if you continued trying to do it (and they'd undelete it all). Not to say your concerns aren't valid, but your "plan" is severely flawed. – animuson May 7 '18 at 3:50
  • 15
    The vandalism you're planning is a violation of the terms of service you have already agreed to. It's also pointless; SE will just restore your posts and, if they need to do so to protect the site, suspend the vandals. – Monica Cellio May 7 '18 at 3:51
  • 1
    @animuson GDPR might disageree here? – joojaa May 7 '18 at 9:16
  • 8
    @joojaa I don't think so. The right for removal pertains to personal information only. A user can at most force SE to remove any trace (more than just reverting to a numbered user) of the person, but as long as the answer doesn't contain any personal data, I don't think the 'right to erasure' applies to it, see also gdpr-info.eu/art-17-gdpr . – Discrete lizard May 7 '18 at 9:28
  • @Discretelizard right and people can in no way be recognized from their writing style? All longer than paragraph long text are probably personal information if you dig hard enough. – joojaa May 7 '18 at 9:39
  • 6
    @joojaa Recognition isn't an important factor, as far as I'm aware. I don't think writing style is personal information, while user identifiers (such as the user number) are (GDPR mentions this explicitly). The right for removal only applies to personal information. – Discrete lizard May 7 '18 at 9:43
  • @Discretelizard I don't dispute that but the terms are vague enough that until there's actual court decisions its not really known. Especially the part that says directly or indirectly is troubling. Anyway i think that SE might be able to apply for some of the exclusions. – joojaa May 7 '18 at 9:49
  • 3
    Something a lot of people miss about the GDPR is that "personal data" is not "personally identifiable data". Questions and answers on stackoverflow actually are "personal data" in the sense of GDPR, as they are associated with you. While it may be possible to anonymise the data instead of deleting it, this may not be the best legal move. That said, there are other legal avenues to refuse deletion - e.g. because the Q&As are part of the service and have implied consent. 17.1c may be on shaky ground there - 6.1b isn't quite covered & "overriding legitimate grounds" might apply. – pinkgothic May 8 '18 at 16:43
  • The license given to Stack Exchange is perpetual but not unconditional. Whether it can survive this level of change to the terms of service is a question for lawyers, not something where users should automatically be assumed to be powerless. – Ben Voigt May 10 '18 at 5:45
  • @animuson: That would not be vandalism. Undeleting would be stackexchange committing a breach of law. He has rejected change of the terms and there is no other recourse at all. – Joshua May 11 '18 at 1:16
  • @Joshua That's complete nonsense. – animuson May 11 '18 at 1:18
  • @animuson: What would you expect to happen on a complete reject of the change of terms then? "He can't" isn't a valid answer. – Joshua May 11 '18 at 1:19
  • 2
    @Joshua Not agreeing with changed terms has zero bearing on the fact that you already published the content under an irrevocable license. Anyone, including us, can continue using that content under the license regardless of whether you no longer agree with the terms of use for the site. Not agreeing now doesn't retract your previous agreement. – animuson May 11 '18 at 1:22
-7

Disclaimer: I'm not trying to defend or argue against any particular position, I'm just trying to provide some context as I understand it. I'm in no way affiliated with SE as a company, everything below is purely a result of my imagination.

SE as a company has decided that the community will be better served if the company takes some investor's money and makes good use of it. Investors have unwavering desire for the company to grow, and this means that SE now is supposed to become a part of big corporate world. In that world, there is an abundance of freely roaming highly-trained sophisticated predatory animals lawyers, looking whereever they could find to bite off a million or ten. At this stage of evolution of this ecosystem, some people think that an arbitration clause in TOS is a must have.

I understand the desire to have SE as an exemplary company, able to stand by its users no matter what. I don't think it's realistic though. The decision to take investor's money has been made. After that, it's often the investors who have final say over any big policy decision. And all the alternatives are not pretty.

For one, SE could decide that they are not concerned about becoming a target for class-action lawsuits (that's what zwol's answer proposes). This will not go down well with investors, who will interpret it as 'SE doesn't care about losing money', and can decide to withdraw at any moment in the future when and if SE needs money again.

Another option for SE is to declare that it does not really want to become big, and will never be an attractive target. Again, investors will not be pleased, and I have a feeling that company which got to the stage where SE is now and have stopped growing will not last long.

The option they are taking now - adding arbitration clause - is considered the safest from business point of view, "everyone else is doing this" is valid argument in these circles.

--

As for why we are not hearing more from SE about the reasons why they are changing the policy - again, lawyers. Any attempt to explain how the law could apply in these particular circumstances by anyone "in the know" can run afoul two serious restrictions with potentially damaging outcome for the person involved. They are not allowed to disclose confidential business information in inappropriate (i.e. not approved from the very top) way, and they are not allowed to give legal advice.

  • 10
    You can also think of it like patent portfolios. A lot of companies have those for purely defensive purposes because bad actors have made them a sort of necessity, and the portfolios tend to grow in a manner that's commensurate with the growth of the company, and their desire to not attract nuisance lawsuits that they will likely need to settle in order to avoid losing and setting precedent that directly affects their valuation. We're nowhere near that big, but we are big enough for bad actors to start looking for opportunities. Not for patents, but just ... opportunities. It stinks. – Tim Post May 3 '18 at 18:33
  • 8
    I don't see why you emphasize taking investors' money. I'm not aware of any major recent changes in Stack Exchange's position regarding taking investors' money; they haven't IPO'd or anything, and they've been taking investors' money since at least 2011. – user2357112 May 3 '18 at 18:45
  • As I said, this is all a result of my imagination, which can be fuzzy at times. But taking investors money certainly affects the process of making company policy decisions. – artem May 3 '18 at 19:08
  • 3
    See Henning Makholm's answer. What you wrote here is not unreasonable, but it does not explain why the arbitration clause isn't limited to disputes where someone demands something from SE. – yannis May 3 '18 at 19:49
  • @yannis: That's required by Jams - see list item 1. I believe the idea is at least partially that arbitration is supposed to reduce legal fees, and both sides should be protected from the other side trying to bury them in legal fees. – user2357112 May 3 '18 at 19:58
  • @user2357112 That would be relevant only if it was an absolute requirement for the arbitration process in general. If not, then I question the wisdom of choosing to go into business with JAMS Inc. – yannis May 3 '18 at 20:11
  • 1
    Where do you think SO's money's coming from in the first place? They have the fairly unique position that their customers is also their product. A lost customer is therefore not just a loss of revenue (which is bad enough for most companies) but also a loss of products. With that in mind they should perhaps care more about their customers/product and less about some 3rd party investors. – Lundin May 4 '18 at 6:50
  • 1
    There are way too many variables at play. They have just released brand-new, subscription-based product. I'm sure they are going to monitor closely how many new paying customers they are able to get, how many 'productized users' they are losing, how many new products they are able to develop and release with current funding, and calculate their next move. Without access to that data, we can only speculate. – artem May 4 '18 at 7:08
  • @TimPost But that argumentation holds only for the US. Patent (and other) law at this side of the ocean is different, and the patent wars so abundant in the US are far less common here. As someone else pointed out, your arbitration clause won't hold up in a European court either. So this seems to be very much focused on US law whereas your user base is literally worldwide. For me this arbitration clause is a deal breaker to contribute to this site. – Joris Meys May 14 '18 at 13:42

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