Sony Sued Over “Can’t Sue Sony” Rules

Sony’s attempts to avoid future lawsuits over anything that has to do with the PlayStation Network have led to a lawsuit that could puzzle lawyers and philosophers alike.

As we reported in September, Sony decided it was so sick of being hit with class action suits over its various hacking incidents and compromised data that it demanded PSN users in North America to agree to new terms and conditions. Those who agreed to the rules would have to formally waive the right to take court action over any dispute with Sony and instead agree to arbitration. (Even if a customer won an arbitration verdict, it would be far less costly for Sony than losing a class action court case.)

Customers had to agree to the terms to carry on using PSN and playing online. To make things even worse, while agreeing the new terms involved a simple on-screen click, a subsequent 30-day cooling period could only be exercised by a mailed letter.

Both Electronics Arts and Microsoft have now added similar terms for the user agreements for Origin and the Xbox 360 dashboard respectively.

The Gamespot site has now uncovered a class action suit filed in November disputing Sony’s right to insist on such a rule. Its main point is that it’s an unfair business practice simply because it effectively leaves users with no choices other than to give up legal rights, or stop using a device they’d already paid for.

The suit also argues that the opt-out process is inadequate, as well as accusing Sony of trying to mislead customers by not making the new rules available online and instead burying them at the end of a 21-page licensing agreement that users will only see once, on the PS3 itself.

There is of course a major potential problem here. In theory the lawyers can argue about the facts of the case such as whether changing the rules is allowed (which may depend on whether PSN use is seen as a benefit of buying a PS3), whether customers could make an informed decision about the change, and whether people even have the ability to give up the right to take court action anyway.

In practice, unless everyone who’s signed up as a plaintiff has successfully written to Sony to reject the new rules, then under the PSN user agreement they can’t actually bring this case. That means that a court will first have to rule on whether the plaintiffs can proceed with this case — at which point the issues of the case itself will inherently have been settled.

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10 Responses to Sony Sued Over “Can’t Sue Sony” Rules

  1. I don't own a PS3 nor do I plan to buy one anytime soon. I'm unfamiliar with mentioned lawsuits, but I have to ask why someone would sue Sony over a hacking incident? Isn't it the hacker who is at fault in that case NOT the company that got hacked? Oh wait the company has deeper pockets and is easily identifiable. Never mind.

    • To catch you up, it's not greed motivating law suits. It is that Sony used sub-par security with their client's information, including e-mail, PSN passwords, credit card info, home address. Millions had this data compromised. And Sony waited a week to tell them that they had been compromised.

      Additionally, millions of clients could not use major portions of the PS3 for gaming or Netflix for almost a month.

  2. ^ really? ignorance… they were sueing sony because sony had their creditcard info, as well as addresses, and by giving that info to sony, you assume that sony itself has the abilitry to protect said information… now, as sony was informed months before it was hacked that its security is sub par, and they did not do anything about it, nor did they even tell people that they were hacked till almost two weeks after the incident, that in itself is terrible business practice for a company that relies on good customer base in many countries world wide.

    sony was to blame, if they had been up to date, and correctly prepared, nothing would have happened… hell just last month Steam was hacked, and yet no-one sure them! because they had the important info hidden, and they TOLD people hours after the ssaid incident…

    make sure you know what you are talking about before making ignorant comments

  3. At least there IS an opt-out. MS doesn’t even offer that option, except as future changes in some of the arbitration.

    That’s why I think MS should’ve been the first target, not Sony. Sony might set a bad precedent because of the existing opt-out.

  4. Hopefully this is the beginning of a snowball of legal actions surrounding "drive-by license agreements" that no company actually EXPECTS reasonable people to read and understand before clicking "Agree". I'm the kinda guy that reads everything I sign, reads words as if they float off a page, don't even need to think about it, and even _I_ can't understand how it's reasonably expected that anyone read the absurdly convoluted language in these 100-page documents presented in a tiny window with a big "Agree" button below it meant to be accidentally clicked.

    Time for "license agreement reform"? Methinks say yes.

  5. anything that screws Sony’s legal dept. is a good thing!A few years ago the bastards put a small Korean restaurant owned and run by a small Korean woman whose actual given name, which she called her noodle shop here in Baltimore, (which sold nor had any connection to anything electronic),……Sony’s out of business for trademark infringement. No Mercy!

  6. I did notice this in the new terms of service for XBox and it really bothered me but I reluctantly agreed since like the article mentioned my choices were basically stop using XBox Live, which I have already paid for and is one of the primary functions of the console, or I can go along with the terms and hope that XBox never puts me in a situation where I would need to seek legal action. Since I'm not the kind of person to actually sue someone anyway it made my choice easy, but these mandatory arbitration clauses are a serious problem and exist in lots of other contracts you have probably signed, like cell phone contracts. The idea that companies can avoid all lawsuits by basically forcing you to agree to give up your rights in exchange for an arbiter that they get to choose and can legally stop using in the future if they start losing arbitrations is ridiculous. Especially when all the cell phone companies or all the game consoles are doing it. You basically can only avoid giving up your rights if decide to forgo that type of service or product, which is not really much of a choice.

  7. This is so trivial! People are upset because they couldn't game for a whole month. I agree that Sony's security faults are not good business practice but the whole lawsuit stuff has gone a bit far. First of all the PSN is a free service. Second, many games still function as single player when you cannot connect. Third, you gave Sony the info and agreed to their terms. If you don't like their security then don't give them your credit card info and purchase PSN cards from a store. As for license agreement complaints try signing a waiver from your kid's school absolving them of any liability, including negligence, for gym class. Or participate in a motorsports event, be it spectator or driver, and sign a liability waiver. There are many things in this world that matter and as fun as video games are they are not that important. If you've given your info, both personal and financial, to Sony then man up (or woman up) and accept the terms you agreed to. I love the comments about "I either give up my rigthts or don't use the product" not being much of a choice… yeah… because not using the product would end your life so there really is no option but to agree.

    • None of what you said is actually much to the point. Here's a simpler analogy for you:

      Imagine you walk into a clothing store; a brick-and-mortar clothing store, in the real world. In the mall, let's say. You want to buy a shirt, but you only have your credit card with you. When you hand it to the clerk, she says this to you:

      "Yes, we accept personal credit cards as payment, in theory, but before we can accept YOUR credit card, we require you to sign this waiver saying that we cannot be held responsible if your credit card information is stolen from us."

      You wonder how exactly your credit card information could be stolen from a clothing store. You wonder why they're making you waive your rights to legal action. Has this been a problem in the past? Will this still be a problem in the future?

      It doesn't matter. You can sign the waiver, or you can forego buying that shirt you want.

      And you can't buy it anywhere else, because every clothing store in the world is making you sign this waiver.

      I guess it's time to join a nudist colony.

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