Be patient -- this is a long story because I have to make myself look reasonable, even though I got suckered:
Last May, I bought my husband an mp3 player for his birthday. I was at the Best Buy with my son, who was 2 1/2 then. As I was trying to pay for the player, the clerk kept trying to sell me the $14.95 warranty. I told her "no" many times. Finally, I asked, "Can I not buy the player without the warranty? Just tell me so I can go somewhere else." She of course said that I could buy the player without the warranty. She then asked, "Would you like 6 issues of Entertainment Weekly or Sports Illustrated? They're free." The sarcasm in her voice was fairly obvious. I told her that I would take 6 issues of Entertainment Weekly. She told me to sign on the computer screen, which I did. The only information on the computer screen was the amount I owed for the player. She then handed me the receipt, and then the player. I went home, wrapped the player, and put the receipt in my jewelry box.
Sure enough, we started getting Entertainment Weekly. We enjoyed our issues. Although my husband won't admit it, he read it more than I did. After the 7th or 8th issue came, I realized that I had received more than my 6 issues. Hmmmm. Then, the mp3 player broke. (If you ask me why I didn't get the warranty, I'll kill you.) So, Paul wanted the receipt so he could call Rio and yell at them. I go to get the receipt and notice that on the receipt is a notice that by signing the receipt, I was agreeing to EW automatically renewing my subscription for six months at $29.99. Aargh.
Rio gave us another mp3 player (which is broken again, but that's another story), and we resigned ourselves to six months of trashy industry news (and a really good column by Stephen King). Then, before I realized it, my debit card was charged for ANOTHER six months at $29.99 when the first six months was over. So, today I finally took the time to cancel the subscription before the next six months runs out.
My contracts question is this: Did I legally bind myself to the first $29.99 renewal subscription by signing a computer screen with no information about that obligation? Does signing a computer screen for one obligation (deduction from my bank account for amount of Rio player) bind me to a secondary obligation that was only explained to me after signing on a tape receipt that was handed to me without any explanation? I understand that I could have been more diligent, but this strikes me as a practice designed to deceive.
In addition, the subscription rate for new subscribers is $19.99/six months, according to the website.
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1. Posted by Gordon Smith on March 24, 2005 @ 10:43 | Permalink
Christine, Can I use this on my Contracts exam next fall?
You could argue that you did not enter into a contract because you had no notice of the existence of a contract. Then again, you had the receipt, and you had an opportunity to cancel before "renewing" your subscription. I suspect for some courts that would be enough.
On the other hand, you might want to complain to Best Buy because they may not want their name associated with this sleazy practice.
2. Posted by Christine's Husband on March 24, 2005 @ 12:25 | Permalink
That's right, I read EW. I'm out and I'm proud! It's only for the articles, of course. Honey, why did you cancel the subscription without telling me?
3. Posted by Nate Oman on March 24, 2005 @ 13:49 | Permalink
Perhaps you have a claim for fraud. In the tort context, you have to show that a misrepresentation was fraudulent and material to collect damages. On the other hand, if you merely want to avoid a contract, you need only show that the misrepresentation was fraudulent or material (not both). Given that you had apparently aroused the ire of the clerk, perhaps you could argue that she was lying to you about the subscription being free, just to stick it to you for not buying the warranty. Animus is not a necessary element of scienter, of course, but it might provide evidence there of.
Of course, there is the information on the receipt. Yet you didn't see this until after you had signed. I would argue that you didn't bind yourself at all by signing for the MP3 player. The real question is whether you became bound by accepting EW. One way of looking at this is to ask what EW's offer consisted of:
1. The clerk saying "Do you want a free subscription."
2. The note on the back of your receipt.
3. The copies of EW sent for your husband.
The problem with arguing that this is too indefinite to be an offer is that the EW ploy is pretty standard in the magazine industry. When someone offers you a free magazine subscription, do you really think that it is free? (Note your embarrassment at the out set of the post.) If everyone knows that "free" actually means "A couple of issues followed by a subscription if you don't affirmatively cancel" then it seems that EW did make an offer that you accepted.
And here we get to a deep question about the law of contracts. Suppose that there is a social understanding of the sort I suggested, where everyone knows that "free" doesn't really mean free. Should the law ratify this social understanding, even though it is a bit slimy? At this point, I don't think that you can really answer the question unless you have some sort of pretty deep opinion of what the law of contracts is supposed to do: enforce self-assumed obligations (go with social meaning), police voluntary transactions for honesty and fair dealing (border line -- don't enforce), promote economic efficiency (borderline -- leaning toward enforcement).
It would be a fun (read: cruel to 1L students) exam hypo. Especially if you add extra facts. I would try to work in something about a peppercorn and a fashion queen named Lucy Lady Duff-Gordon.
4. Posted by Gordon Smith on March 24, 2005 @ 15:56 | Permalink
Paul, that was very funny!
I'm not sure I have ever seen EW. Paul's out, but I am just out of it, I guess.
Nate, I was wondering about the social understanding, too. I was going to quote that old "free lunch" aphorism at Christine, but she is obviously feeling bad enough.
The funny thing about this is that lawyers tend to analyze these questions as if a court is going to decide. (Nate and I both did that.) But a court will never see this because the amounts are too small. What is the role of law in these circumstances? I suppose that Best Buy might pay attention if thousands of customers fell prey to this scheme and some enterprising lawyer decided to bring a class action. Otherwise, law doesn't play a direct role, even though it informs our notions about right and wrong.
5. Posted by Kaimi on March 24, 2005 @ 17:25 | Permalink
What happens if you don't pay? Typically with these kinds of deals scams, they send you a bill and you can write "Cancel" and be free with no obligation.
And I know in my rational mind that these are all tricks, that they raise prices and count on you not canceling and fleece you. And yet just last week we got the first of six months of free Time magazine after entering mortgage information at Lending Tree . . .
6. Posted by armchair genius on March 24, 2005 @ 19:27 | Permalink
I will give you the practical answer - find the credit card bill where you got charged for the magazine. Call the number on the line with the charge, and tell them you didn't want the subscription and were told it was a free 6 issue trial. Demand a refund/credit to your card. They may say yes, they may say no. If they say yes well problem solved obviously. If they say no, inform them that you will contact your credit card company and demand a chargeback. They may credit you then. If they don't, call the credit card company and tell them the charge was not authorized, and you want it charged back.
They may require you to fill out a form, but eventually they will do it.
Most people don't know this, but all credit card companies require even more unconscionable agreements with vendors than with their own customers. So if a customer claims a charge was made without consent, the credit card company can charge that back at its sole discretion AND the vendor gets hit with a punitive fee (I believe there was a big lawsuit about those fees some years back).
The vendor can challenge the charge back, but companies like the one you are dealing with won't - they know they are in the gray area of the law if not committing out and out fraud - so they just keep what they can.
7. Posted by Christine on March 24, 2005 @ 19:31 | Permalink
That's the insidious part, Kaimi. There's no bill. I have never received an envelope of any kind from EW, just the magazine. The only evidence of a renewal is a debit from my checking account.
On the social knowledge of "free" -- I think I would be able to say with a straight face to a judge that I really thought I would get six free magazines. However, if I had signed up for six free magazines in a separate transaction in which I had to give a credit card number, I would have known their was something up. For example, when you try a 30-day free trial of an online subscription, you know that if you don't cancel, your credit card (that you just entered) will be cancelled. Here, I had already given her my credit card for the mp3 player.
I bet, however, that if I had called after the 7th magazine arrived, I could have cancelled no questions asked. But who calls? I didn't get a bill, so I would have to look up the phone number or go to the website. Very ingenious.
8. Posted by Christine on March 24, 2005 @ 19:40 | Permalink
Good point, Mr. Genius. I guess that's why they call you that. Where were you six months and $29.99 ago?
9. Posted by armchair genius on March 25, 2005 @ 18:13 | Permalink
Sorry :P (as an aside, it is intended to be a self-deprecating name - like armchair quarterback) I didn't realize it was a debit card though (you mentioned it came directly out of your checking account). I am not sure if they work the same as credit cards - but they probably do given that most are Visa branded.
10. Posted by Joe on June 24, 2005 @ 11:21 | Permalink
I just noticed I was charged for a subscription I never knew I had agreed to. Shame on BestBuy for being a part of this. I've been very happy with them over the years, this only tarnishes a good reputation they've developed. I called 888-225-5821 and they cancelled my subscription and credited my credit card.