This sounds like it could be the new DDoS attack - crowdsourced arbitration claims against a company that's already committed itself via T&Cs to paying advance costs. You've struck gold here Yassine.
I wish I could take credit for this but I can't. I mention in the piece how crafty class action lawyers swamped DoorDash and Amazon by coordinating thousands of simultaneous arbitration demands. My own experience was way more micro, but also way more accessible to the individual.
Nov 3, 2022·edited Nov 3, 2022Liked by Yassine Meskhout
Right, but keyboard warriors could in theory coordinate the same tactic without needing any lawyers. E.g. with Paypal's not-so-withdrawn $2500 misinformation fine, anyone who doesn't like it could just spam Paypal with arbitration.
I think you get the credit for DIY arbitration; class action lawyers would never want to cut themeslves out as a well-compensated middleman.
Fair, I admit it's a possibility. I'm still skeptical of the likelihood of this happening through just keyboard warriors. Class action lawyers get a really bad rep but they are horrifically efficient administrators, regularly tasked with managing and disbursing amounts that are the equivalent to the GDP of a small country. If I ever wanted to run a galactic empire, they'd be one of my first picks for bureaucrats.
I personally think gadflies are the unsung heroes of our society--they say the often-unpopular things that nevertheless should be said. They are often disliked as a result, but if they vanished tomorrow the world would be a much less fair place.
and a discussion thread with comments from multiple people with experience in arbitration, all (of the ones I read) generally supportive of the argument that arbitration is generally good for consumers with ordinary disputes like yours, probably better than the alternatives: https://news.ycombinator.com/item?id=31567673
User "thathndude" also has some tips for how to get more compensation for your trouble.
The main case for arbitration as being pro-consumer, is that by reducing costs to the corporation, it reduces costs for *most* consumers interacting with that company. In other words, the benefit isn't for the few squeaky wheels that need grease: it's for everyone else who commonly does not. And as long as it's commonly "enough", consumers do win out overall.
Me, I see arbitration as just freedom of contract. You can agree to whatever contracts you want, and then you ought be held to them. That you might not have much *choice* in the contracts you agree to, is largely not material. I have a favorite pair of pants, and I've bought eight pairs of them in various models over the years. Unfortunately, Columbia discontinued their Aruba IV convertible cargo pants with liner, so I can't get them any more. I'd love it if they made more. That doesn't mean I'm going to get my wish. (The closest current model, the Backcast, lacks good pockets! And I want pockets.) Same for dispute clauses, maybe.
That said, when the problems are "common" enough, and for low enough value...yeah, arbitration can be onerous. Maybe the real punishment is just these companies losing customers. Still, companies can be hoisted on their own petard here! I recently heard about how Uber ended up on the hook for $91m because they screwed up and arbitration held them to their word. https://www.hklaw.com/en/insights/publications/2022/04/uber-loses-appeal-challenging-91-million-in-mass-arbitration-fees As mentioned elsewhere here, it sounds like maybe the same thing happened to DoorDash and Amazon, too.
Anyway, as a semi-detached observer without a dog in the arbitration debate to which I am deeply, ideologically committed, I find this all quite fascinating.
I largely agree. I didn't get into a deep dive here, but I think it's important to step back and appreciate just how good consumers have it in general. It's so wild how flooded we are with quality services people 50 years ago could only dream about, and where the default price is *free*. I might quibble about the power imbalances involved but that's not really enough for me to want to throw out everything.
There's a point in the article where you mention a similar thing happened to Amazon and DoorDash and it implies that it also happened en-masse to PayPal, did I miss something?
While reading the article I kept thinking of Owen Benjamin whose supporters did a similar thing to Patreon a company with a similar near monopoly in it's niche. I can't recall if he got his account back but they apparently cost Patreon hundreds of thousands of dollars collectively.
Regarding Colin's situation and his lawyers saying there is no path. My suspicion is that you are not worth the effort of fighting, and Colin is a target that they would at least bring to arbitration. Once there I assume either the poor winrate stats, or the fact that there are probably a dozen clauses for how PayPal has sole discretion to terminate accounts in the agreement are present would cause them to believe there is little chance. I don't think Colin has the level of guile implied in choosing not to do this to keep the controversy alive (he could probably grift support money on GFM that would be cancelled :D ).
Jesse also needs to pay you more, your writing is always a treat to read.
As far as I know there has not been a concerted arbitration demand on PayPal. Amazon/DoorDash took a lot of effort to pull off, and it was spearheaded by experienced class action litigators who know what they were doing. But because both were fundamentally a labor dispute with contractors, it was much easier to coordinate the complaints along the same template.
I reviewed their UA for those clauses and did not see anything with that level of unilateral discretion. That said, it's very possible that Colin will lose because he *is* worth fighting, but I still want to see that duel! I don't see any downside to him trying, and a loss would not only be illuminating to hear from his perspective, but also would be even more damning for PayPal.
And thx. Money is cool but I get more than enough gratification knowing that my pro bono hours are going to support a jewish-owned business.
Re: mass paypal action: goes to show my reading comprehension :D
I've been following lawsuits for "fun" for a few years now, so to get something as great as Colin taking it to "the man" over transgender ideology based online de-banking is pretty in my wheelhouse. I'm 100% for it, even if just selfishly,
Good job, but it doesn't seem adequate to really solve the general problem, because it doesn't seem to impose enough cost on the wretched company. I wonder if you really had to agree that reinstating your account was adequate and thus no actual arbitration was required? After all, the company never gave you any full accounting of why they had suspended your account, nor any promise not to do it again in a month. Suppose you had said that in the absence of these things, there was still a dispute and arbitration should go forward? That might impose enough cost on the wretched company to make a difference?
In retrospect I wish I persevered but at the time it didn't seem worth my effort. I was also unfamiliar enough with arbitration mores that I didn't want to make it seem like I was pursuing a frivolous dispute. I can't claim that my own individual actions are anywhere near enough to solve the general problem obviously, that's why this is a call to action!
I wanted to share this on a Polish, Reddit-like site. Normally when I do that I just translate (mostly automatically, via Deepl) and post it quoted in the comments - but I thought it might be better to just publish it on Substack itself. I've done the translation (draft: https://sinity.substack.com/p/7716b3ae-cadc-4308-a6d2-fdd73d1b9c82), but then I figured that I probably should ask for permission to publish it. Ofc no monetization.
I know this will be controversial, but to me the lesson here is: there is a case that mandated arbitration -- as compared to wrestling with the court system -- is pretty great!
Yes, I think arbitration might get a bad rep because too often it's analyzed in isolation. A good analysis would be to compare and contrast it to traditional courts. There's some pros and cons, and it's not obvious to me where the line lands in the end.
Having listened to Leor Sapir’s interview on Gender: A Wider Lens, I’m wondering if arbitration for detransitioners might be a ripe option. The line in Meskout’s piece about arbitration judges often being specialized, versus regular judges being generalists, has me intrigued.
As is my brand, I'll undercut my own point. Overall, arbitration judges are definitely way more specialized, but normal judges can be too! Perhaps the best example is Delaware, the state where more than half of ALL publicly traded US corporations are incorporated. A big reason why Delaware is so attractive for businesses is its Chancery Court system, which is relatively efficient and also staffed by judges who are world-class in their expertise on business law. Another example would be the US bankruptcy courts, which so many countries try to replicate.
Fair! It was just interesting to hear Sapir explain how the normal American way of having courts weigh in on contested issues is not a safe bet when it comes to pediatric transition or other gender identity related issues, due to judges' deference to expert bodies like the APA etc. Reading your piece today just got me wondering if maybe arbitration judges would be, even if in the future, a better option because they can and do develop specialties more often than regular circuit judges. Thanks for your reply!
The problem with arbitration is that there's no jury. A jury would be ideal in assessing the devastation incurred by transition surgery and medication, with “consent” paperwork signed by mentally distressed, and possibly mentally ill patients.
(Have not seen the interview on Gender: A Wider Lens. Going there now.)
I think that "terms of service" are only in force where this is a massive power differential between the customer and the vendor (or, in the case of more social media companies, between the user and the service provider, since the user is rarely if ever the customer). In business-to-business transactions, for which contracts and contract law were created, most contracts are negotiable. Both parties can ask for different terms in exchange for concessions or benefits. These "terms of service" are one-way, and they are treated as such by corporations.
I think there should be a Bill of Rights when it comes to ToS (Terms of Service):
1) ToS must offer a plain language summary of each ToS item.
2) ToS must clearly spell out the consequences of failing to adhere to each ToS item.
3) When consequences are applied based on a ToS violation, the user must be notified of (a) the consequences and their duration, (b) the specific ToS item violated, (c) the specific action (or lack of action) on the part of the user which resulted in that violation, and (d) the path through which the user can challenge their violation, including specific steps.
4) ToS challenges not reviewed within a reasonable amount of time (say 8 weeks, but I'm really just throwing out a number that seems reasonable to me) result in automatic reinstatement of the service.
5) The service provider must publish statistics for its ToS violations, per ToS item, including overall trailing 365-day count, median time to review challenge, median time to arbitration resolution, % of challenges resolved in favor of the user vs. % resolved in favor of the service provider.
There are probably more one could add, but these seem to me to be a bare minimum.
I actually think the entire internet needs an opt-in adjudication layer. This may seem way off base but would be interested in your thoughts on something like this. Basically, I want a republic style governance layer to track topic based reputation and give open and clear ways to arbitrate disputes.
End state is a future where you can earnestly say “of course it’s true, I saw it in the internet!” And no one thinks you’re dumb for saying that.
This sounds like it could be the new DDoS attack - crowdsourced arbitration claims against a company that's already committed itself via T&Cs to paying advance costs. You've struck gold here Yassine.
I wish I could take credit for this but I can't. I mention in the piece how crafty class action lawyers swamped DoorDash and Amazon by coordinating thousands of simultaneous arbitration demands. My own experience was way more micro, but also way more accessible to the individual.
Right, but keyboard warriors could in theory coordinate the same tactic without needing any lawyers. E.g. with Paypal's not-so-withdrawn $2500 misinformation fine, anyone who doesn't like it could just spam Paypal with arbitration.
I think you get the credit for DIY arbitration; class action lawyers would never want to cut themeslves out as a well-compensated middleman.
Fair, I admit it's a possibility. I'm still skeptical of the likelihood of this happening through just keyboard warriors. Class action lawyers get a really bad rep but they are horrifically efficient administrators, regularly tasked with managing and disbursing amounts that are the equivalent to the GDP of a small country. If I ever wanted to run a galactic empire, they'd be one of my first picks for bureaucrats.
I am now envisioning the next in the Lucas series: "Star Wars: The Class Action Warriors."
I personally think gadflies are the unsung heroes of our society--they say the often-unpopular things that nevertheless should be said. They are often disliked as a result, but if they vanished tomorrow the world would be a much less fair place.
Needless to say, I love this essay.
The customer service call loop made the hair on the back of my neck stand up. Adulthood horror stories where the protagonist wins? Have to love it.
I love this so much I wish it were a movie, but I'm not sure how to make it visually compelling. I guess an essay is the best medium. Well done.
Not all heroes wear capes
Nice work, reminds me of the old 419 scam hunters
This was both hilarious and helpful; I wish more lawyers wrote in this style.
As someone who receives numerous lawyer-written articles every day (allegedly aimed at laypeople) it's exasperating how unreadable they are.
After two paragraphs of the average lawyer newsletter on copyright matters, I've lost the will to live
Here is another story similar to yours: https://www.shuchow.com/so-i-took-a-huge-corporation-to-arbitration/
and a discussion thread with comments from multiple people with experience in arbitration, all (of the ones I read) generally supportive of the argument that arbitration is generally good for consumers with ordinary disputes like yours, probably better than the alternatives: https://news.ycombinator.com/item?id=31567673
User "thathndude" also has some tips for how to get more compensation for your trouble.
Wow thank you for posting this! I apparently did not search hard enough when I was looking for other examples of my travails.
A fun and fascinating story here!
The main case for arbitration as being pro-consumer, is that by reducing costs to the corporation, it reduces costs for *most* consumers interacting with that company. In other words, the benefit isn't for the few squeaky wheels that need grease: it's for everyone else who commonly does not. And as long as it's commonly "enough", consumers do win out overall.
Me, I see arbitration as just freedom of contract. You can agree to whatever contracts you want, and then you ought be held to them. That you might not have much *choice* in the contracts you agree to, is largely not material. I have a favorite pair of pants, and I've bought eight pairs of them in various models over the years. Unfortunately, Columbia discontinued their Aruba IV convertible cargo pants with liner, so I can't get them any more. I'd love it if they made more. That doesn't mean I'm going to get my wish. (The closest current model, the Backcast, lacks good pockets! And I want pockets.) Same for dispute clauses, maybe.
That said, when the problems are "common" enough, and for low enough value...yeah, arbitration can be onerous. Maybe the real punishment is just these companies losing customers. Still, companies can be hoisted on their own petard here! I recently heard about how Uber ended up on the hook for $91m because they screwed up and arbitration held them to their word. https://www.hklaw.com/en/insights/publications/2022/04/uber-loses-appeal-challenging-91-million-in-mass-arbitration-fees As mentioned elsewhere here, it sounds like maybe the same thing happened to DoorDash and Amazon, too.
Anyway, as a semi-detached observer without a dog in the arbitration debate to which I am deeply, ideologically committed, I find this all quite fascinating.
I largely agree. I didn't get into a deep dive here, but I think it's important to step back and appreciate just how good consumers have it in general. It's so wild how flooded we are with quality services people 50 years ago could only dream about, and where the default price is *free*. I might quibble about the power imbalances involved but that's not really enough for me to want to throw out everything.
Jesse, if you’re going to make a sock puppet account, you might want to avoid talking about cargo pants. Dead giveaway. 😉
Nothing I love more than a “I’m about to make my law degree your problem” story.
There's a point in the article where you mention a similar thing happened to Amazon and DoorDash and it implies that it also happened en-masse to PayPal, did I miss something?
While reading the article I kept thinking of Owen Benjamin whose supporters did a similar thing to Patreon a company with a similar near monopoly in it's niche. I can't recall if he got his account back but they apparently cost Patreon hundreds of thousands of dollars collectively.
Regarding Colin's situation and his lawyers saying there is no path. My suspicion is that you are not worth the effort of fighting, and Colin is a target that they would at least bring to arbitration. Once there I assume either the poor winrate stats, or the fact that there are probably a dozen clauses for how PayPal has sole discretion to terminate accounts in the agreement are present would cause them to believe there is little chance. I don't think Colin has the level of guile implied in choosing not to do this to keep the controversy alive (he could probably grift support money on GFM that would be cancelled :D ).
Jesse also needs to pay you more, your writing is always a treat to read.
As far as I know there has not been a concerted arbitration demand on PayPal. Amazon/DoorDash took a lot of effort to pull off, and it was spearheaded by experienced class action litigators who know what they were doing. But because both were fundamentally a labor dispute with contractors, it was much easier to coordinate the complaints along the same template.
I reviewed their UA for those clauses and did not see anything with that level of unilateral discretion. That said, it's very possible that Colin will lose because he *is* worth fighting, but I still want to see that duel! I don't see any downside to him trying, and a loss would not only be illuminating to hear from his perspective, but also would be even more damning for PayPal.
And thx. Money is cool but I get more than enough gratification knowing that my pro bono hours are going to support a jewish-owned business.
Re: mass paypal action: goes to show my reading comprehension :D
I've been following lawsuits for "fun" for a few years now, so to get something as great as Colin taking it to "the man" over transgender ideology based online de-banking is pretty in my wheelhouse. I'm 100% for it, even if just selfishly,
Good job, but it doesn't seem adequate to really solve the general problem, because it doesn't seem to impose enough cost on the wretched company. I wonder if you really had to agree that reinstating your account was adequate and thus no actual arbitration was required? After all, the company never gave you any full accounting of why they had suspended your account, nor any promise not to do it again in a month. Suppose you had said that in the absence of these things, there was still a dispute and arbitration should go forward? That might impose enough cost on the wretched company to make a difference?
In retrospect I wish I persevered but at the time it didn't seem worth my effort. I was also unfamiliar enough with arbitration mores that I didn't want to make it seem like I was pursuing a frivolous dispute. I can't claim that my own individual actions are anywhere near enough to solve the general problem obviously, that's why this is a call to action!
Hi,
I wanted to share this on a Polish, Reddit-like site. Normally when I do that I just translate (mostly automatically, via Deepl) and post it quoted in the comments - but I thought it might be better to just publish it on Substack itself. I've done the translation (draft: https://sinity.substack.com/p/7716b3ae-cadc-4308-a6d2-fdd73d1b9c82), but then I figured that I probably should ask for permission to publish it. Ofc no monetization.
Can I?
Yes! Please be sure to link the original.
I know this will be controversial, but to me the lesson here is: there is a case that mandated arbitration -- as compared to wrestling with the court system -- is pretty great!
Yes, I think arbitration might get a bad rep because too often it's analyzed in isolation. A good analysis would be to compare and contrast it to traditional courts. There's some pros and cons, and it's not obvious to me where the line lands in the end.
Having listened to Leor Sapir’s interview on Gender: A Wider Lens, I’m wondering if arbitration for detransitioners might be a ripe option. The line in Meskout’s piece about arbitration judges often being specialized, versus regular judges being generalists, has me intrigued.
As is my brand, I'll undercut my own point. Overall, arbitration judges are definitely way more specialized, but normal judges can be too! Perhaps the best example is Delaware, the state where more than half of ALL publicly traded US corporations are incorporated. A big reason why Delaware is so attractive for businesses is its Chancery Court system, which is relatively efficient and also staffed by judges who are world-class in their expertise on business law. Another example would be the US bankruptcy courts, which so many countries try to replicate.
Fair! It was just interesting to hear Sapir explain how the normal American way of having courts weigh in on contested issues is not a safe bet when it comes to pediatric transition or other gender identity related issues, due to judges' deference to expert bodies like the APA etc. Reading your piece today just got me wondering if maybe arbitration judges would be, even if in the future, a better option because they can and do develop specialties more often than regular circuit judges. Thanks for your reply!
The problem with arbitration is that there's no jury. A jury would be ideal in assessing the devastation incurred by transition surgery and medication, with “consent” paperwork signed by mentally distressed, and possibly mentally ill patients.
(Have not seen the interview on Gender: A Wider Lens. Going there now.)
I think that "terms of service" are only in force where this is a massive power differential between the customer and the vendor (or, in the case of more social media companies, between the user and the service provider, since the user is rarely if ever the customer). In business-to-business transactions, for which contracts and contract law were created, most contracts are negotiable. Both parties can ask for different terms in exchange for concessions or benefits. These "terms of service" are one-way, and they are treated as such by corporations.
I think there should be a Bill of Rights when it comes to ToS (Terms of Service):
1) ToS must offer a plain language summary of each ToS item.
2) ToS must clearly spell out the consequences of failing to adhere to each ToS item.
3) When consequences are applied based on a ToS violation, the user must be notified of (a) the consequences and their duration, (b) the specific ToS item violated, (c) the specific action (or lack of action) on the part of the user which resulted in that violation, and (d) the path through which the user can challenge their violation, including specific steps.
4) ToS challenges not reviewed within a reasonable amount of time (say 8 weeks, but I'm really just throwing out a number that seems reasonable to me) result in automatic reinstatement of the service.
5) The service provider must publish statistics for its ToS violations, per ToS item, including overall trailing 365-day count, median time to review challenge, median time to arbitration resolution, % of challenges resolved in favor of the user vs. % resolved in favor of the service provider.
There are probably more one could add, but these seem to me to be a bare minimum.
I actually think the entire internet needs an opt-in adjudication layer. This may seem way off base but would be interested in your thoughts on something like this. Basically, I want a republic style governance layer to track topic based reputation and give open and clear ways to arbitrate disputes.
End state is a future where you can earnestly say “of course it’s true, I saw it in the internet!” And no one thinks you’re dumb for saying that.
https://extelligence.substack.com/p/my-twitter-product-roadmap