In addition to arbitration clauses, which strip consumers of the ability to form class actions, I’ve started to see a lot of indemnity clauses in the terms and conditions imposed by service providers online.
Here is an example. (I’ve changed the name of the company, added emphasis, and put in a couple of paragraph breaks):
You hereby agree to defend, indemnify, and hold harmless BIG_CORP and its business and technology partners, underlying technology creators, third-party suppliers, operators and providers, licensors, board members, officers, directors, shareholders, employees, distributors, resellers, affiliates, and agents from and against any damages, losses, liabilities, judgments, fines, settlements, and expenses (including, without limitation, costs and reasonable attorneys’ fees) in connection with any claim or action arising from any cause such as: … (iv) any other reason including but not limited to acts of God, destruction, theft, defects, viruses, communication failure, failure of performance, impairment or loss of data, suspension or termination of service, and unauthorized access to BIG_CORP’s system, records, data, or settings.
You agree that BIG_CORP has the right to seek and recover all of its damages caused by you through any use of the service in an unlawful manner, in a manner that violates BIG_CORP’s privacy, acceptable use, import, or anti-spam policies, or in a manner inconsistent with the terms of this agreement. You acknowledge that such damages may include, without limitation, direct, indirect, special, incidental, cover, reliance, and consequential damages. You acknowledge and agree that this provision will apply to all services from BIG_CORP and its affiliates whether or not BIG_CORP is notified of any possibility of such damages.
The terms of this section shall survive the termination of this agreement regardless of the cause or nature of such termination.
Guessing your eyes glazed over and you skimmed those. Here is a paraphrase, the TL;DR. There are two agreements:
- The first is to use your own resources to defend and secure the interests of everyone associated with the BIG_CORP service (including third parties) against any damage or loss for any reason.
- The second is to grant BIG_CORP access to your own resources in order to cover damages caused by your misuse of the service or illegal activity that you undertake with benefit of the service.
- You agree to these things forever, for the rest of your life or the life of BIG_CORP, regardless of whether you continue to be a customer.
Both of the situations covered by these agreements have been historically mediated by courts of law in connection with individual cases. Courts grant damages to successful plaintiffs and the costs of defense to successful defendants. Defending cases, however, including frivolous ones, is hard on BIG_CORP’s bottom line. Instead, they put it on you, and take control from the courts over deciding whether your actions have violated terms or caused damages. They still need the courts in order to come after you; but, these terms make the outcome cheaper and more certain to obtain. Further, your acceptance of these terms gives BIG_CORP leverage in negotiating settlements.
Here is an explanation from UpCounsel.com about indemnification clauses. Most of the information you’ll find about them online is oriented toward the companies that use them.
So what do you do if BIG_CORP decides you owe them? You hire a lawyer. Who pays? You. Who wins? Consider that BIG_CORP has a lot more resources to put to bear on the case, including better informed, better connected, and more experienced lawyers.
Me personally, I avoid assenting to agreements that contain these terms. It means that I don’t use quite a few things that you do. Some of them are things that many might consider essential to modern life. Some exposure is unavoidable. Like if I want to keep using Apple devices, systems, and services. (There are shades. The indemnification clause that Apple uses is somewhat less far-reaching than this example; but not innocent.)
If you think these provisions are unfair, and find them more or less impossible to avoid, consider lobbying your representatives or supporting a lobbying organization who does. Like, you have time, right? BIG_CORP can pay someone to lobby for them. They make it someone’s job.
The closest organization I’ve found dedicated to protecting consumers against unfair trade practices is the FTC. Quoted from the referenced article, “the FTC has rulemaking power to address concerns regarding industry-wide practices”. Unfortunately, getting the FTC to attend to something probably requires advocacy from public representatives (Senators or members of Congress), which requires lobbying.
There is an organization called “Terms of Service, Didn’t Read” (ToS;DR) that tries to read and summarize these documents for you. They have a rating system that DuckDuckGo (DDG) uses to help with their overall web site ratings. (You still use the big Goo for search, right? Compare the ratings on ToS;DR for the Goo and DuckDuckGo. My search results with DDG are excellent.)
(Images from Wikimedia creative commons)