Amazon’s terms of service have been updated to include a clause that may surprise many subscribers. The online retailer is revoking the right to file a class-action lawsuit against it should a dispute arise, according to its Conditions of Use page.
On Friday, Amazon sent an email to subscribers explaining that it will now settle any disputes through arbitration. Customers who have continued to use the company’s services after 14 August have implicitly waived their rights to bring new class-action suits against the online retail giant.
The language on the Conditions of Use page sets out this new legal limitation directly. “You and we agree that any dispute or claim relating in any way to your use of any Amazon service, or to any products or services sold or distributed by Amazon or through amazon.com, will be resolved by binding arbitration rather than in court,” the document reads. “There is no judge or jury in arbitration, and court review of an arbitration award is limited. A neutral arbitrator will resolve the dispute or claim and must follow the terms of this agreement as a court would.”
What the Class-Action Waiver Means
A class-action waiver is also included, preventing customers from filing requests for arbitration together. Although Amazon is permitted to resolve batches of arbitration proceedings under detailed mass arbitration rules, each dispute must be filed individually.
Amazon frames the change as a positive for its customers, pledging to “pay most of the cost” for those who choose to arbitrate disputes. A company spokesperson said that Amazon has and will continue to “continually update our Conditions of Use to better serve our customers.”
“We determined that reinstating the arbitration clause will offer customers a fast, cost-effective way to resolve disputes while still giving them the option of going to small claims court,” the spokesperson added.
Why Compensation May Be Harder to Obtain
There are very few exceptions to Amazon’s new arbitration clause, and none are especially favourable for customers. You can still take the company to small claims court, but the compensation available there is extremely limited.
Before the terms of service update, it only took one motivated individual to carry out research, consult legal professionals and set a class-action lawsuit in motion. From there, other affected parties could sign on and receive compensation with comparatively little effort.
That is not the case with an arbitration policy, which sets a higher bar for individual effort and personal costs that may dissuade many customers from pursuing their financial disputes. Before any arbitration proceeding can be filed, customers must first submit a dispute claim to Amazon directly.
Class-action suits filed before the terms of service changes were made public will continue through the courts. If you use any of Amazon’s services or products, this Conditions of Use change applies to you.
