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New Ebay Contracts: What’s in the Fine Print?

Ebay’s new contracts require users to compose a letter and snail-mail it to them in order to retain the right to make legal claims against the site. Find out how, why, and what you can do about it.

Ebay by Chong Fong Liew

Photo by Chong Fong Liew

If you’ve ever bought or sold anything on E-bay, your consumer rights with the online company are changing as of today. November 9 is the last day that E-bay users have to opt-out of a new forced-arbitration provision and prohibition on class-action lawsuits, both of which appear in the company’s new user agreement contract.

The company announced on September 15 that unless consumers send written opt out notice today, they would no longer be able to file suit against E-bay. The company said it would only accept opt-outs received via snail mail and using a special printed form. Otherwise individual arbitration, a private legal proceeding known for favoring the corporations that pay the legal bills, will be your only means of resolving any dispute with the company.

By making it unlikely that most users will protect themselves, E-bay is eliminating potentially valid legal claims against them .

Unsure of what this means, exactly? You’re not alone. The implications of the legal changes, and the means of evading them, are deliberately opaque. “Most people aren’t even aware of the impact of an arbitration clause to begin with, then asking them to print out a letter and send it in the mail is just ridiculous,” said Christine Hines, Public Citizen’s consumer and civil justice counsel. “Opt-outs generally don’t work; an opt-out by snail mail is an extra outrage.”

By making it unlikely that most users will protect themselves against the new provisions, E-bay is eliminating potentially valid legal claims against their site. For example, users will find it more difficult to challenge any misuse of consumer data. Also, those with small-dollar claims typically file class-action suits because it does not make financial sense to pursue such matters individually. By protecting themselves against class-action, E-bay can potentially take advantage of whole groups of shoppers.

Public Citizen recommends contacting your members of Congress and letting them know you oppose forced arbitration clauses.

Forced arbitration clauses are becoming ever more popular in the corporate world, particularly in the telecommunications and financial-services industries. There has been a noticeable upswing since 2011, when the Supreme Court ruled in favor of AT&T including such a clause in their user agreement. Public Citizen has compiled a gallery of forced arbitration rogue companies to help raise consumer awareness.

If you’ve never shopped on E-bay, but might in the future, be advised that new users still have 30 days to opt out of the contract provisions. Also, if you use PayPal, which is owned by E-bay, you have until December 1 to opt out of a similar forced arbitration clause with them (for a downloadable template, check theconsumerist.com).

If you’d like to oppose the growing trend of corporations sneaking these clauses into their user agreements, Public Citizen recommends contacting your members of Congress and letting them know you oppose forced arbitration clauses. Corporations may think they can erode consumer’s legal rights without our notice, but we’re onto them.


Signe Predmore wrote this article for YES! Magazine, a national, nonprofit media organization that fuses powerful ideas with practical actions. Signe is an editorial intern at YES! and is currently on leave from studying international politics in Sweden.

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