We’ve listened to what you’ve been telling us about the arbitration clause that our most recent ToS update introduced. While we can't incorporate all of the feedback you offered, we did listen to it, and got with our legal experts and higher-ups to see what we could deliver as a compromise.
We realize that a fair amount of dissonance seems to be coming from us not diving too deeply into our reasoning for implementing an arbitration clause in the first place. We’re going to try and put some more color around that in the most lay terms possible.
Unfortunately, that means that this post is going to be a little long winded, but we sincerely hope that you read it completely, even if you find yourself disagreeing with some or even all of it. We're still willing to talk; we hope this finally does a good job of explaining our position so the conversation can be more productive.
First, we want to address what was pretty clearly miscommunication on our end:
People objected to the notion that you had to use arbitration to settle disputes, but thought we could drag you into court. That’s not the case — we are both agreeing that if we have a dispute and can’t resolve it between us, that we will settle the dispute through binding arbitration. The only carve-outs are for small claims court, and for certain IP-related actions (which others noted were in need of a carve-out). The language to address all of the possibilities for carve-outs is simply way too long to put in a single document, if you have a specific concern, you can opt-out. We'll try to add more clarity if you need it, but we can't advise you. If you still have concerns, opting-out is most likely the best thing to do.
People felt that both parties should be able to influence the selection of the arbitrator. This is also in place. JAMS' Consumer rules require that, “The arbitrator(s) must be neutral, and the consumer must have a reasonable opportunity to participate in the process of choosing the arbitrator(s).”
There were concerns that users had to come to New York to pursue arbitration. This is not the case. While the arbitration will be based out of New York, you’re entitled to participate from your hometown. JAMS rules say “The consumer must have a right to an in-person hearing in his or her hometown area.” There are also provisions for attending remotely, if that’s what is required.
Some folks seemed to think that this eliminated users’ recourse to force any payment or remediation if we do something bad. This is a misunderstanding of arbitration. Arbitration requires users to bring claims to an arbitrator instead of the courts. If those claims are deemed valid, the arbitrator can award damages, and those awards are binding — we have to pay them.
Most of all, you wanted to know why we'd include arbitration in the first place.
You want to know why the heck do we even need this in the first place? Why are you so committed to doing this? We feel that’s a fair, and probably the most relevant question; we’re going to try to answer that. As with all things legal, it starts out with well, that’s kinda complicated, do you have an hour or two? Let's make it take less than that.
While we may have done our share of goofing things up in the past, often by not communicating things clearly or far enough in advance, we’re asking that all of you try to keep in mind that we’ve done our best to show extremely good nature through the sum of our past actions, and ask that you please consider that separately from your feelings concerning arbitration.
We hope you can try to keep in mind that this isn’t something we want to do (no one is enjoying this), it’s something we actively resent needing to do, along with our current legal climate, and that makes it all the more difficult for us to keep saying that we feel like we must do it.
We offer our sincere gratitude in advance, as we get on with it:
In the event of litigation, arbitration is likely to be the best choice.
We are non-litigious in nature because we rely on goodwill from strangers, and allow anyone to earn our trust through their contributions. That’s the only model that’s going to work for us. At the same time, we have to take some reasonable steps toward a defensive posture in hopes that’s all we’ll ever need to do. Remember, the vast majority of people actually using the site as intended are essentially anonymous touches.
In the event of an actual case, arbitration helps because:
Arbitrators typically have more industry knowledge. JAMS arbitrators are former judges that are selected based on their area of expertise. In contrast, federal judges are selected randomly, and may or may not have a particular area of expertise. The JAMS process ensures that the person arbitrating is the most qualified.
There’s fast resolution. Our judicial systems, being what they are (in most cases), can’t really tout that as a selling point. This minimizes our costs in advance, and lets us put “war chest” money to better work for stuff that you can actually use.
JAMS is well-respected, fair, and reasonable. You can and certainly will do your own diligence in research, but even things like allowing for remote participation (preventing mega corps from selecting locations too onerous for other parties to attend) speaks to the process having a clear goal of fast and fair resolution. You can’t guarantee the fast part with the courts, and fair might come down to how much domain knowledge a judge has.
Arbitration isn’t new to our ToS; It has been a concept for a couple of years.
We already have an arbitration-like process in place as a Privacy Shield certified company; this is an expansion of that policy that has been in place for a little over two years (well, since Safe Harbor was replaced by Privacy Shield). Privacy Shield is an ADR, like JAMS.
In a nutshell, every effort should be given to come to a resolution outside of an actual court process. Actual litigation, where papers get filed and judges preside, becomes a thing only if an agreement can’t be reached. It is in the interest of every party concerned to try to come to an agreement prior to asking a judge to settle it.
With JAMS, there’s no second step; arbitration absolutely has to work, and we see no reason to fear otherwise; arbitrators are (again) typically better versed than sitting judges in this domain because arbitrators are selected for their expertise in particular matters rather than having cases assigned to them randomly, and can handle cases at least equally fairly, if not more due to expertise, and certainly more expeditiously.
We don’t want things to come to litigation, ever.
We don’t want things to ever come to actually having a case in litigation, nobody likes it. That means, as we grow and become more profitable, we have to protect ourselves to some degree against frivolous lawsuits. While some have listed companies within the realm of our industry that do not have these clauses:
That is their own risk assessment, based on advice of their counsels, with their strategies for the next 10 years in mind. Most of the companies referenced by folks as examples of entities in our industry that do not have a similar clause also don’t have offerings around jobs and employment, that’s a subtle but pretty important difference.
That doesn’t mean they aren’t considering it, or didn’t consider it. We all have different goals and we all anticipate things that could hinder those goals differently. Some also have much bigger wallets and war chests than we do.
We aren’t exactly unique in preferring to completely avoid litigation whenever possible, but we may be more adverse to it than others, and thus perceptively more paranoid. In some situations, litigation doesn’t need to be technically successful in order to ruin a business, it only needs to burn through resources. As more and more bad actors base success not on winning a judgement, but running the other party out of funds, we have to protect ourselves as our increasing profitability makes us a more threatening target.
We owe it to you, the people that have put hundreds — more often thousands — of hours of work into our sites, to maintain a conservative legal profile that is exactly sufficient to avoid litigious engagement in today’s legal climate. We don’t update documents like this through knee-jerk panic reactions to industry buzz, but we also can’t allow ourselves to fall short of a sensible or reasonable level of protection.
An opt-out was put there specifically for those we trust and who trust us.
Once you read the terms and go through the opt-out process, we’re going to go out on a limb and decide that you’re not the kind of entity that we need to be worried about. We’re going to make opt-out easy for anyone with a profile on the site.
Send an e-mail to
email@example.com with the subject of 'opt out of arbitration' and your real name, your mailing address and a link to your profile(s) in the body. That's it, we'll handle everything from there. You'll get confirmation back via email.
We're looking at something possibly more robust, but the ability to do it via email should hopefully address one of the larger concerns. As e-mail is the most basic and intuitive method, it'll always remain a valid method to opt-out, even if something new is introduced.
If you positively, absolutely, categorically, undisputedly, and undoubtedly despise arbitration, you can opt-out right now if you want and forget about it completely.
More transparency is coming so that we continue to earn your trust.
We really do appreciate how vocal and, quite frankly, precise you’ve been in your arguments both agreeing and disagreeing with our decision to pursue this. As much time as we’ve spent on it, we still firmly believe that having this is likely to save us considerable amounts of time and resources in the future. We hear your arguments that simply dropping it would serve our short-term interests well, but our long-term interests get even scarier if we do that.
Most of us tend to hate the need for this stuff, which tends to make us hate the means to avoid it. The payback for all of this effort is, if effective, absolutely zero. That we don’t get hauled into a frivolous class action lawsuit that we’re forced to spend time and money escaping is a negative that we won’t be able to document. It’s something that we hope won’t happen, so the payback in terms of what we can hold in our hand for all of this effort is essentially zilch. That stinks, but that’s the way it works.
As GDPR nears, and our other policies update, we're pretty confident that a more benign picture will emerge when it comes to our stance here. A lot of work to make, essentially, nothing happen, isn't work that was wasted. Staying out of litigation is a net gain that's hard to measure.
Our approach to this was exhaustive, even if it seems otherwise.
We’ve discussed this in every imaginable context with our lawyers and we definitely feel that this is protection that we really can’t do without, but we want you to know, we’re looking at this as a shield, not a sword, and we hope that the world’s legal climate only gets better, not worse.
And while you might say “that’s exactly what someone holding a sword would say”, people with nefarious goals don’t tend to be overly-transparent about those goals or their motivations. This policy doesn’t in any way change how we perceive or interact with all of you; it’s intended to be a net to make sure all of those darn mosquitos don’t get in the way of that.
We’re still, as always, open to questions about it. We’re rebooting a few things on our end, and we’ll update this post once the new version goes live (and emails are scheduled to go out). Thank you, all, for your very generous and civil input on this stuff, and for (most of you) assuming the best intentions on our part through this.
If you still have concerns, remember, opting-out will be simple. This post doesn't mean we've stopped listening to you, or that we've stopped caring, we've just done our best to reconcile our goals and strategies with the very clear objections that you've raised. Could we still do better, given what we've explained? Let us know. The new terms will go live once we get the opt-out in place, and notifications sent.
And remember, if you still feel apprehensive, you can opt-out. We'll update with the window (and demarcation point) as soon as the revisions and notifications go out.