Walmart for Women?

Say what you will about Walmart, but give it credit perhaps for partnering in a project aimed to empower female entrepreneurs.  Walmart's Women's Economic Empowerment Project in partnership with Enactus (a global non-profit organization) has been criticized by some as merely part of a public relations campaign to combat image problems in the wake of sex-discrimination lawsuits.  Regardless of whether that is true, however, the project has provided hundreds of women with workforce training and assistance in creating new businesses or strengthinging exsiting businesses in the United States alone.  The Project connects students with academic and industry leaders throughout the United States and other countries to create and carry out endeavors designed to empower women through education and entrepreneurial action.  

Walmart and Enactus award millions of dollars to fund teams of students and leaders who carry out their proposed plans to empower women.  Plans are selected for funding based on the following stated criteria:

• "Degree of empowerment achieved for women
• Media exposure (teams are required to recognize Walmart by name in all Walmart Women’s Economic Empowerment activities pertaining to signage, advertising and media outreach)
• Project concept, execution, outputs and outcomes"

The "media exposure" component may again raise skepticism regarding Walmart's motives. Nonetheless, the program seems to be producing results so why complain?  Spokespersons for the Project report that hundreds of women in the United States alone have been able to enter or renter the workforce, receive promotions and increase their overall income due to participation in funded projects.  Those interested in the Project or applying for funding should check out the website and decide for themselves.  The application deadline for the next round of funding has closed, but the next round of selections should open soon. 

Disclosure Debates (. . . same old, same old)

We talk about disclosures, and the importance of reading our consumer contract terms before committing to any deal. However, does anyone really care about contracts? Let’s face it: Contracts have become largely meaningless until we run into problems and want to use the “terms” for ammunition to get a remedy. I am a Contracts Professor and often bypass e-contract terms when I am in a hurry or know that I could never get the terms changed. We are all lazy in reading contracts. I have confirmed this in my own research, which I wrote about in Pizza-Box Contracts: True Tales of Consumer Contracting Culture, published in the Wake Forest Law Review.  Disclosure debates are not new.

At the same time, texting and tweets as forms of disclosure have augmented shrouding and other tactics for effectivley hiding terms and contract modifications. The Federal Trade Commission hosted a one-day public workshop on Wednesday, May 30, 2012 to consider the need for new guidance concerning advertising and privacy disclosures in online and mobile environments. The workshop focused especially on challenges of making disclosures clear and conspicuous in social media and mobile marketing.

MyConsumerTips.info

I have been working for a few years in developing and creating a consumer outreach website at MyConsumerTips.info.  The site is purely non-profit and has no sponsors or advertisers. It aims to simply provide consumers with “consumer tips” that change each day, independent summaries regarding debt-related and other consumer rights, quizzes and polls regarding such issues, and other consumer protection resources. It is user-friendly and interactive. This is part of my larger “Consumer Empowerment”service and experiential learning projects, and outreach endeavors.

Unfortunately, it is tough to gain traction for such non-profit sites without paying for promotions through Google or others. Also, there so many sites that purport to provide consumer resources that individuals suffer information overload and are not sure what to trust.

Hopefully, MyConsumerTips.info will deservedly gain trust, do some good and expand in ways that benefit consumers!  Check it out.

Protecting Public Rights

Contracts professors, policymakers, consumer groups and others have become particularly interested in another post-AT&T Mobility LLC v. Concepcion case.  The United States Court of Appeals for the Ninth Circuit recently agreed to an en banc rehearing of Kilgore v. Keybank, 673 F.3d 947 (9th Cir. 2012).  The issue in this case is whether Concepcion precludes courts from preserving judicial access for public injunctions under state consumer protection statutes by invoking the public policy exemption from the Federal Arbitration Act's ("FAA") mandate that courts enforce arbitration agreements according to their terms.  The en banc hearing is set for some time in December of this year.

The case is important on many levels.  It raises fundamental questions about the reach of FAA preemption in the wake of Concepcion, in which the United States Supreme Court held that the FAA preempted courts from using California unconscionability law to strike a class relief waiver and order class arbitration.  Moreover, the case implicates states' power to protect individuals' access to meaningful injunctive relief in order to enforce and protect public rights under state statutes, such as consumer protection statutes.  

The Gender Divide in Payday Lending

Nathalie Martin has done great work and has posted comments on Creditslips.org regarding payday lending. I also have been interested in how these payday loans prey on consumers with the least resources and power, and have helped consumers with related issues through my outreach work. At the same time, I have had the privilege to have students like Adria Robinson, who take great interest in these consumer issues. Adria Robinson is so passionate about consumer issues that she volunteered to work with me in gathering the latest data on Colorado's payday lending post-passage of its new payday regulations in August of 2010. Thanks to Adria for her help with this post!

Needle in a Haystack?

Following my post regarding PayPal's new opt-out arbitration provision, I talked to many individuals who could not find the directions for how they can opt out (hence "needle in a haystack").  Here they are:

"Opt-Out Procedure.

You can choose to reject this Agreement to Arbitrate ("opt out") by mailing us a written opt-out notice ("Opt-Out Notice"). For new PayPal users, the Opt-Out Notice must be postmarked no later than 30 Days after the date you accept the User Agreement for the first time. If you are already a current PayPal user and previously accepted the User Agreement prior to the introduction of this Agreement to Arbitrate, the Opt-Out Notice must be postmarked no later than December 1, 2012. You must mail the Opt-Out Notice to PayPal, Inc., Attn: Litigation Department, 2211 North First Street, San Jose, CA 95131.

The Opt-Out Notice must state that you do not agree to this Agreement to Arbitrate and must include your name, address, phone number, and the email address(es) used to log in to the PayPal account(s) to which the opt-out applies. You must sign the Opt-Out Notice for it to be effective. This procedure is the only way you can opt out of the Agreement to Arbitrate."

It seems PayPal is banking on our inertia.  How likely are we to send a letter in the mail to opt-out when PayPal is used for e-contracts?  Why not simply have an online opt-out procedure, as companies do for unsubscribing to online newsletters?  

That said, PayPal's arbitration procedure is arguably reasonable on its face.  

Fine Print Foils

I was delighted to see Melissa Jacoby’s call in September for more poetry on creditslips.org! Therefore, I wish to share the poem I wrote that served as basis for the lyrics to a consumer protest song that accompanies a non-profit consumer outreach film, Fine Print Foils, that I produced a couple of years ago. Why not have fun with consumer protection?

Fine Print Foils
by Amy J. Schmitz

Fine print foils
We do our best
Confusing contracts
We do detest

Companies send us
Sterling “steals”
Promised savings
Offered as “deals”

“Freebies” are false
And contracts change
While rates rise high
Beyond fair range

Consumers caught
In a mindless maze
Seeking solace
Stuck in a haze

Of limited know-how
And lack-luster laws
Needing protection
From companies’ jaws

Yet we have a duty
To watch what we sign
And read terms closely
Not assuming they’re fine

Embrace education
Empowerment grows
Let’s work together
To end contract woes

You can listen to the song via the link: Fine Print Foils song

PayPal Joined the Party

Adam Levitin commented on the eBay's opt-out arbitration program on CreditSlips.org a few weeks ago, and there have been campaigns calling for consumers to opt out of eBay's program.  Public Citizen has provided instructions on its website for consumers "to protect their constitutional rights by opting out of a forced arbitration clause and ban on consumers joining together in class actions."  eBay is not alone in using this sort of opt-out arbitration program.  Many tech companies have joined, or plan to join, the "party" in requiring consumers to opt out or be subject to binding arbitration.

Opt-out programs also may be layered now that PayPal is joining the party.  It recently sent notices to its users of policy updates, effective November 1, 2012, stating:

"You will, with limited exception, be required to submit claims you have against PayPal to binding and final arbitration, unless you opt out of the Agreement to Arbitrate (Section 14.3) by December 1, 2012. Unless you opt out: (1) you will only be permitted to pursue claims against PayPal on an individual basis, not as a plaintiff or class member in any class or representative action or proceeding and (2) you will only be permitted to seek relief (including monetary, injunctive, and declaratory relief) on an individual basis."

Query whether campiagns will begin for consumers to opt out of this program?  It also will be interesting to see how these opt-outs work in tandem due to PayPal's prominence as the purchasing mechanism for sites like eBay?  

When Squeaky Wheels Get Rusty

Yesterday, I wrote about the "squeaky wheel system," or "SWS" for ease of reference, which I explored in my article, Access to Consumer Remedies in the Squeaky Wheel System.  The research shows that consumers who have and take the time and resources to complain (or “squeak”) often get what they want. For example, consumers with the time and patience to endure the labrynth of their phone company's customer assistance line and actually speak with a representative regarding an increase in their bill are much more likely to get "loyalty" and other such discounts.  

That said, I have noticed that companies are even becoming more stingy in providing assistance to proactive consumers. For example, a manufacturer recently insisted on charging me for shipping to send me a replacement for a blender that was under warranty.  Sure, the warranty covered replacement . . . but  not shipping (a la "fine print").  The warranty was therefore meaningless since the blender was worth about the same as the shipping cost, and it would be silly to expend resources to sue using UCC Article 2 or other warranty arguments.  Furthermore, I have been unable lately to catch many breaks on increased fees for phone and internet service, and had difficulty in obtaining any assistance from some credit card companies when trying to rectify the issues I faced when my purse and all my credit cards recently were stolen.

Winners and Losers in the Squeaky Wheel System

First, I want to thank you for the invitation!  

Most have heard the adage: “The squeaky wheel gets the grease.” We have long known that the “squeaky wheels” who are proactive in pursuing their needs and complaints are most likely to get what they want. That is proper for the most part to the extent that it rewards those who expend the time and resources to pursue their interests. However, this “squeaky wheel system,” or “SWS” for ease of reference, allows businesses to bank on our inertia (laziness) in contracting and ration remedies to only those with the most resources and power. This also may allow businesses to control public information by quieting the squeaky wheel consumers. The SWS can effectively prevent economists’ proposed “informed minority” from policing fairness of contract terms and business practices by alerting the majority about purchase concerns and prompting companies to make contract changes.

This SWS has troubled me, leading to my recent article, Access to Consumer Remedies in the Squeaky Wheel System in volume 39 of the Pepperdine Law Review. This Article uncovers the salience of the SWS and explores its impacts on contract regulation and purchase practices in the consumer marketplace. It also provides a snapshot of empirical data from my own e-survey of Colorado consumers that is relevant to SWS dynamics. The article proposes proportional and efficient means for consumers to access purchase information and contract remedies using online and other low-cost remedy mechanisms. This proposal is by no means the “answer” and I invite other ideas for expanded and equalized remedy mechanisms to help diffuse the SWS,narrow the divide between the consumer “haves” and “have-nots,” and foster better fairness regulation of companies’ contract and claims assistance practices.