EventHorizon1984 Log

How To Guide - FTC Guides Concerning Use Of Endorsements And Testimonials In Advertising

How To Guide - FTC Guides Concerning Use Of Endorsements And Testimonials In Advertising
18 May 2009
EventHorizon1984
Commentary

This comment isn't really about the material violations made by certain corporations and their paid shills.  Although we're including the link and text, because eBay spams the Internet with these eBay blogs and associated keywords. And we like to help them along.

Today's lesson, so to speak, is what we've noticed in the actual online FTC complaint process. 

If you don't feel like writing an actual letter and mailing it (http://www.ftc.gov/ftc/cmplanding.shtm), here's the link to the online complaint form.

FTC Complaint Assistant
https://www.ftccomplaintassistant.gov/

What do we see first?

Step 1: Let's Get Started
Is your complaint concerning identity theft?
( ) Yes
( ) No

For this example, select "No".

Is your complaint most closely related to:
( ) Debt collectors or debt collection practices
( ) Credit Reports
( ) Dissatisfaction with other business practices

You get to the interesting part when you select "Dissatisfaction".

What kind of company are you complaining about?

Automobile
Business Opportunities
Home Furnishings/Repair
Internet
Lending Financial / Services
Lottery of Sweepstakes
Telephone/Cable
Work-related
Other

Want to hazard a guess as to what choices you get when "Internet" is selected?

Auctions
Internet Service Provider
Spyware/Computer Viruses
Web Design Services
Other Internet Practices

Auctions
Internet Service Provider
Spyware/Computer Viruses
Web Design Services
Other Internet Practices

It is truly amazing at the amount of Federal attention the "Internet" "Auctions" business has garnered recently.  Think the FTC is referring to eBay here?  Or perhaps eBay's paid and undisclosed speakers?

Unless some "Internet" "Auctions" business plans to spin this as 'Auctions means Amazon too'.

In case you're wondering.  Yes, there's more to the form.  Yes, we are doing some spring cleaning bulk filings.  Don't need this type of distraction and "noise" during the summer.

And you may be asking too, does this go anywhere?  Based on past history, see our end quote.

"Oooh That's Gotta Hurt!"
Ash (Bruce Campbell), Army of Darkness (1992)
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http://www.ftc.gov/bcp/guides/endorse.htm

FTC GUIDES CONCERNING USE OF
ENDORSEMENTS AND TESTIMONIALS IN ADVERTISING

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Sec.255.0 255.1 255.2 255.3 255.4 255.5

Definitions. General considerations. Consumer endorsements Expert endorsements. Endorsements by organizations. Disclosure of material connections.

Authority: 38 Stat. 717, as amended; 15 U.S.C. 41 - 58.

§255.0 Definitions.

(a) The Commission intends to treat endorsements and testimonials identically in the context of its enforcement of the Federal Trade Commission Act and for purposes of this part. The term endorsements is therefore generally used hereinafter to cover both terms and situations.

(b) For purposes of this part, an endorsement means any advertising message (including verbal statements, demonstrations, or depictions of the name, signature, likeness or other identifying personal characteristics of an individual or the name or seal of an organization) which message consumers are likely to believe reflects the opinions, beliefs, findings, or experience of a party other than the sponsoring advertiser. The party whose opinions, beliefs, findings, or experience the message appears to reflect will be called the endorser and may be an individual, group or institution.

(c) For purposes of this part, the term product includes any product, service, company or industry.

(d) For purposes of this part, an expert is an individual, group or institution possessing, as a result of experience, study or training, knowledge of a particular subject, which knowledge is superior to that generally acquired by ordinary individuals.

Example 1: A film critic's review of a movie is excerpted in an advertisement. When so used, the review meets the definition of an endorsement since it is viewed by readers as a statement of the critic's own opinions and not those of the film producer, distributor or exhibitor. Therefore, any alteration in or quotation from the text of the review which does not fairly reflect its substance would be a violation of the standards set by this part.

 

Example 2: A TV commercial depicts two women in a supermarket buying a laundry detergent. The women are not identified outside the context of the advertisement. One comments to the other how clean her brand makes her family's clothes, and the other then comments that she will try it because she has not been fully satisfied with her own brand. This obvious fictional dramatization of a real life situation would not be an endorsement.

 

Example 3: In an advertisement for a pain remedy, an announcer who is not familiar to consumers except as a spokesman for the advertising drug company praises the drug's ability to deliver fast and lasting pain relief. He purports to speak, not on the basis of his own opinions, but rather in the place of and on behalf of the drug company. Such an advertisement would not be an endorsement.

 

Example 4: A manufacturer of automobile tires hires a well known professional automobile racing driver to deliver its advertising message in television commercials. In these commercials, the driver speaks of the smooth ride, strength, and long life of the tires. Even though the message is not expressly declared to be the personal opinion of the driver, it may nevertheless constitute an endorsement of the tires. Many consumers will recognize this individual as being primarily a racing driver and not merely a spokesman or announcer for the advertiser. Accordingly, they may well believe the driver would not speak for an automotive product unless he/she actually believed in what he/she was saying and had personal knowledge sufficient to form that belief. Hence they would think that the advertising message reflects the driver's personal views as well as those of the sponsoring advertiser. This attribution of the underlying views to the driver brings the advertisement within the definition of an endorsement for purposes of this part.

 

Example 5: A television advertisement for golf balls shows a prominent and well-recognized professional golfer hitting the golf balls. This would be an endorsement by the golfer even though he makes no verbal statement in the advertisement.

[40 FR 22128, May 21, 1975, as amended at 45 FR 3872, Jan. 18, 1980]

§255.1 General considerations.

(a) Endorsements must always reflect the honest opinions, findings, beliefs, or experience of the endorser. Furthermore, they may not contain any representations which would be deceptive, or could not be substantiated if made directly by the advertiser. [See Example 2 to Guide 3 (§255.3) illustrating that a valid endorsement may constitute all or part of an advertiser's substantiation.]

(b) The endorsement message need not be phrased in the exact words of the endorser, unless the advertisement affirmatively so represents. However, the endorsement may neither be presented out of context nor reworded so as to distort in any way the endorser's opinion or experience with the product. An advertiser may use an endorsement of an expert or celebrity only as long as it has good reason to believe that the endorser continues to subscribe to the views presented. An advertiser may satisfy this obligation by securing the endorser's views at reasonable intervals where reasonableness will be determined by such factors as new information on the performance or effectiveness of the product, a material alteration in the product, changes in the performance of competitors' products, and the advertiser's contract commitments.

(c) In particular, where the advertisement represents that the endorser uses the endorsed product, then the endorser must have been a bona fide user of it at the time the endorsement was given, Additionally, the advertiser may continue to run the advertisement only so long as he has good reason to believe that the endorser remains a bona fide user of the product. [See §255.1(b) regarding the ``good reason to believe'' requirement.]

Guide 1, Example 1: A building contractor states in an advertisement that he specifies the advertiser's exterior house paint because of its remarkable quick drying properties and its durability. This endorsement must comply with the pertinent requirements of Guide 3. Subsequently, the advertiser reformulates its paint to enable it to cover exterior surfaces with only one coat. Prior to continued use of the contractor's endorsement, the advertiser must contact the contractor in order to determine whether the contractor would continue to specify the paint and to subscribe to the views presented previously.

 

Example 2: A television advertisement portrays a woman seated at a desk on which rest five unmarked electric typewriters. An announcer says ``We asked Mrs. X, an executive secretary for over ten years, to try these five unmarked typewriters and tell us which one she liked best.''

 

The advertisement portrays the secretary typing on each machine, and then picking the advertiser's brand. The announcer asks her why, and Mrs. X gives her reasons. Assuming that consumers would perceive this presentation as a ``blind'' test, this endorsement would probably not represent that Mrs. X actually uses the advertiser's machines in her work. In addition, the endorsement may also be required to meet the standards of Guide 3 on Expert Endorsements.

[Guide 1]
[45 FR 3872, Jan. 18, 1980]

§255.2 Consumer endorsements.

(a) An advertisement employing an endorsement reflecting the experience of an individual or a group of consumers on a central or key attribute of the product or service will be interpreted as representing that the endorser's experience is representative of what consumers will generally achieve with the advertised product in actual, albeit variable, conditions of use. Therefore, unless the advertiser possesses and relies upon adequate substantiation for this representation, the advertisement should either clearly and conspicuously disclose what the generally expected performance would be in the depicted circumstances or clearly and conspicuously disclose the limited applicability of the endorser's experience to what consumers may generally expect to achieve. The Commission's position regarding the acceptance of disclaimers or disclosures is described in the preamble to these Guides published in the Federal Register on January 18, 1980.

(b) Advertisements presenting endorsements by what are represented, directly or by implication, to be ``actual consumers'' should utilize actual consumers, in both the audio and video or clearly and conspicuously disclose that the persons in such advertisements are not actual consumers of the advertised product.

(c) Claims concerning the efficacy of any drug or device as defined in the Federal Trade Commission Act, 15 U.S.C. 55, shall not be made in lay endorsements unless (1) the advertiser has adequate scientific substantiation for such claims and (2) the claims are not inconsistent with any determination that has been made by the Food and Drug Administration with respect to the drug or device that is the subject of the claim.

Guide 2, Example 1: An advertisement presents the endorsement of an owner of one of the advertiser's television sets. The consumer states that she has needed to take the set to the shop for repairs only one time during her 2-year period of ownership and the costs of servicing the set to date have been under $10.00. Unless the advertiser possesses and relied upon adequate substantiation for the implied claim that such performance reflects that which a significant proportion of consumers would be likely to experience, the advertiser should include a disclosure that either states clearly and conspicuously what the generally expectable performance would be or clearly and conspicuously informs consumers that the performance experienced by the endorser is not what they should expect to experience. The mere disclosure that ``not all consumers will get this result'' is insufficient because it can imply that while all consumers cannot expect the advertised results, a substantial number can expect them. [See the cross reference in Guide 2(a) regarding the acceptability of disclaimers or disclosures.]

Example 2: An advertiser presents the results of a poll of consumers who have used the advertiser's cake mixes as well as their own recipes. The results purport to show that the majority believed that their families could not tell the difference between the advertised mix and their own cakes baked from scratch. Many of the consumers are actually pictured in the advertisement along with relevant, quoted portions of their statements endorsing the product. This use of the results of a poll or survey of consumers probably represents a promise to consumers that this is the typical result that ordinary consumers can expect from the advertiser's cake mix.

Example 3: An advertisement purports to portray a ``hidden camera'' situation in a crowded cafeteria at breakfast time. A spokesperson for the advertiser asks a series of actual patrons of the cafeteria for their spontaneous, honest opinions of the advertiser's recently introduced breakfast cereal. Even though the words ``hidden camera'' are not displayed on the screen, and even though none of the actual patrons is specifically identified during the advertisement, the net impression conveyed to consumers may well be that these are actual customers, and not actors. If actors have been employed, this fact should be disclosed.

[Guide 2]
[45 FR 3872, Jan. 18, 1980]

§255.3 Expert endorsements.

(a) Whenever an advertisement represents, directly or by implication, that the endorser is an expert with respect to the endorsement message, then the endorser's qualifications must in fact give him the expertise that he is represented as possessing with respect to the endorsement.

(b) While the expert may, in endorsing a product, take into account factors not within his expertise (e.g., matters of taste or price), his endorsement must be supported by an actual exercise of his expertise in evaluating product features or characteristics with respect to which he is expert and which are both relevant to an ordinary consumer's use of or experience with the product and also are available to the ordinary consumer. This evaluation must have included an examination or testing of the product at least as extensive as someone with the same degree of expertise would normally need to conduct in order to support the conclusions presented in the endorsement. Where, and to the extent that, the advertisement implies that the endorsement was based upon a comparison such comparison must have been included in his evaluation; and as a result of such comparison, he must have concluded that, with respect to those features on which he is expert and which are relevant and available to an ordinary consumer, the endorsed product is at least equal overall to the competitors' products. Moreover, where the net impression created by the endorsement is that the advertised product is superior to other products with respect to any such feature or features, then the expert must in fact have found such superiority.

Example 1: An endorsement of a particular automobile by one described as an ``engineer'' implies that the endorser's professional training and experience are such that he is well acquainted with the design and performance of automobiles. If the endorser's field is, for example, chemical engineering, the endorsement would be deceptive.

Example 2: A manufacturer of automobile parts advertises that its products are approved by the ``American Institute of Science.'' From its very name, consumers would infer that the ``American Institute of Science'' is a bona fide independent testing organization with expertise in judging automobile parts and that, as such, it would not approve any automobile part without first testing its efficacy by means of valid scientific methods. Even if the American Institute of Science is such a bona fide expert testing organization, as consumers would expect, the endorsement may nevertheless be deceptive unless the Institute has conducted valid scientific tests of the advertised products and the test results support the endorsement message.

Example 3: A manufacturer of a non-prescription drug product represents that its product has been selected in preference to competing products by a large metropolitan hospital. The hospital has selected the product because the manufacturer, unlike its competitors, has packaged each dose of the product separately. This package form is not generally available to the public. Under the circumstances, the endorsement would be deceptive because the basis for the choice of the manufacturer's product, convenience of packaging, is neither relevant nor available to consumers.

Example 4: The president of a commercial ``home cleaning service'' states in a television advertisement that the service uses a particular brand of cleanser in its business. Since the cleaning service's professional success depends largely upon the performance of the cleansers it uses, consumers would expect the service to be expert with respect to judging cleansing ability, and not be satisfied using an inferior cleanser in its business when it knows of a better one available to it. Accordingly, the cleaning service's endorsement must at least conform to those consumer expectations. The service must, of course, actually use the endorsed cleanser. Additionally, on the basis of its expertise, it must have determined that the cleansing ability of the endorsed cleanser is at least equal (or superior, if such is the net impression conveyed by the advertisement) to that of competing products with which the service has had experience and which remain reasonably available to it. Since in this example, the cleaning service's president makes no mention that the endorsed cleanser was ``chosen,'' ``selected,'' or otherwise evaluated in side-by-side comparisons against its competitors, it is sufficient if the service has relied solely upon its accumulated experience in evaluating cleansers without having to have performed side-by-side or scientific comparisons.

Example 5: An association of professional athletes states in an advertisement that it has ``selected'' a particular brand of beverages as its ``official breakfast drink''. As in Example 4, the association would be regarded as expert in the field of nutrition for purposes of this section, because consumers would expect it to rely upon the selection of nutritious foods as part of its business needs. Consequently, the association's endorsement must be based upon an expert evaluation of the nutritional value of the endorsed beverage. Furthermore, unlike Example 4, the use of the words ``selected'' and ``official'' in this endorsement imply that it was given only after direct comparisons had been performed among competing brands. Hence, the advertisement would be deceptive unless the association has in fact performed such comparisons between the endorsed brand and its leading competitors in terms of nutritional criteria, and the results of such comparisons conform to the net impression created by the advertisement.

[Guide 3]
[40 FR 22128, May 21, 1975]

§255.4 Endorsements by organizations.

Endorsements by organizations, especially expert ones, are viewed as representing the judgment of a group whose collective experience exceeds that of any individual member, and whose judgments are generally free of the sort of subjective factors which vary from individual to individual. Therefore an organization's endorsement must be reached by a process sufficient to ensure that the endorsement fairly reflects the collective judgment of the organization. Moreover, if an organization is represented as being expert, then, in conjunction with a proper exercise of its expertise in evaluating the product under §255.3 of this part (Expert endorsements), it must utilize an expert or experts recognized as such by the organization or standards previously adopted by the organization and suitable for judging the relevant merits of such products.

Example: A mattress seller advertises that its product is endorsed by a chiropractic association. Since the association would be regarded as expert with respect to judging mattresses, its endorsement must be supported by an expert evaluation by an expert or experts recognized as such by the organization, or by compliance with standards previously adopted by the organization and aimed at measuring the performance of mattresses in general and not designed with the particular attributes of the advertised mattress in mind. (See also §255.3, Example 5.)

[Guide 4]
[40 FR 22128, May 21, 1975]

§255.5 Disclosure of material connections.

When there exists a connection between the endorser and the seller of the advertised product which might materially affect the weight or credibility of the endorsement (i.e., the connection is not reasonably expected by the audience) such connection must be fully disclosed. An example of a connection that is ordinarily expected by viewers and need not be disclosed is the payment or promise of payment to an endorser who is an expert or well known personality, as long as the advertiser does not represent that the endorsement was given without compensation. However, when the endorser is neither represented in the advertisement as an expert nor is known to a significant portion of the viewing public, then the advertiser should clearly and conspicuously disclose either the payment or promise of compensation prior to and in exchange for the endorsement or the fact that the endorser knew or had reasons to know or to believe that if the endorsement favors the advertised product some benefit, such as an appearance on TV, would be extended to the endorser.

Example 1: A drug company commissions research on its product by a well-known research organization. The drug company pays a substantial share of the expenses of the research project, but the test design is under the control of the research organization. A subsequent advertisement by the drug company mentions the research results as the ``findings'' of the well-known research organization. The advertiser's payment of expenses to the research organization need not be disclosed in this advertisement. Application of the standards set by Guides 3 and 4 provides sufficient assurance that the advertiser's payment will not affect the weight or credibility of the endorsement.

Example 2: A film star endorses a particular food product. The endorsement regards only points of taste and individual preference. This endorsement must of course comply with §255.1; but even though the compensation paid the endorser is substantial, neither the fact nor the amount of compensation need be revealed.

Example 3: An actual patron of a restaurant, who is neither known to the public nor presented as an expert, is shown seated at the counter. He is asked for his ``spontaneous'' opinion of a new food product served in the restaurant. Assume, first, that the advertiser had posted a sign on the door of the restaurant informing all who entered that day that patrons would be interviewed by the advertiser as part of its TV promotion of its new soy protein ``steak''. This notification would materially affect the weight or credibility of the patron's endorsement, and, therefore, viewers of the advertisement should be clearly and conspicuously informed of the circumstances under which the endorsement was obtained.

Assume, in the alternative, that the advertiser had not posted a sign on the door of the restaurant, but had informed all interviewed customers of the ``hidden camera'' only after interviews were completed and the customers had no reason to know or believe that their response was being recorded for use in an advertisement. Even if patrons were also told that they would be paid for allowing the use of their opinions in advertising, these facts need not be disclosed.

[Guide 5]
[45 FR 3873, Jan. 18, 1980]

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DESTROY ALL COUNTERFEITS! - eBay's New June 2009 User Agreement

DESTROY ALL COUNTERFEITS! - eBay's New June 2009 User Agreement
14 May 2009
EventHorizon1984
Commentary

We made a condensed comment on the AuctionByte blog "eBay Revises Fakes Policy: Return, not Destroy".  What follows is a full article.

The material in this article is provided to you free of charge, "AS IS" WITHOUT WARRANTY OF ANY KIND, EITHER EXPRESSED OR IMPLIED, INCLUDING, BUT NOT LIMITED TO, THE IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, OR NON-INFRINGEMENT.

Basically talk to a attorney figuratively face-to-face when seeking legal advice.  Not that we're dispensing any.

 

The May 13th AuctionBytes articles "eBay's New Policy Instructs Buyers to Destroy Fakes" and "Questions over eBay's New Fakes Policy" brought to light a section in eBay's User Agreement, that would be implemented 14 June 2009.

 

• For covered claims that meet the conditions and are not excluded, buyers are required to destroy an item if they claim it is not authentic. Once a buyer confirms destruction of the item, eBay will reimburse the buyer.
• For covered claims that meet the conditions and are not excluded, sellers agree to not hold buyers or eBay responsible for the destruction of an item if it is not believed to be authentic

 

Looking at the California statutes, eBay INC being located in the State of California, this type of action is covered under "California Criminal Law", "Crimes Against Property", "Larceny", "Grand Theft", etal. 

All 50 U.S. States and U.S. Territories have similar laws.  Then there's the matter of Interstate Commerce, and it's coverage by the U.S. Attorney General and the F.B.I.

And yes, there's more.

A day later someone at eBay with a legal background must have read the MBA produced User Agreement.

***Updated: Changes to the eBay User Agreement***
May 14, 2009 | 04:46PM PST/PT

Scott Shipman

 

 

On May 15, eBay will be releasing a revised user agreement. This revision will address the obligations of buyers and sellers in transactions where a buyer has alleged receipt of a counterfeit item.

Under the revised agreement:

• Buyers and sellers shall work in good faith during the resolution process to determine that the item is not counterfeit.
• If buyer and seller cannot determine that the item is not counterfeit, buyers are required to send the item back to the seller. Cost of return shipping will be paid by the buyer or eBay, unless both buyer and seller have agreed otherwise.
• Covered claims that meet the conditions and are not excluded will count as a violation by the seller of our prohibited and infringing items policy.
• If eBay determines the buyer is not acting in good faith, eBay may restrict or eliminate their ability to return items or make future claims.
• Sellers shall not list, advertise, or cause that item to appear for sale, barter or trade, on any eBay Inc. web site or service.

These revisions to the user agreement are being made to:

• Provide sellers protections against inaccurate counterfeit claims.
• Provide buyers assurances about the authenticity of the item received.
• Maintain integrity of the eBay marketplace.

The new User Agreement is effective immediately for new members registering on or after today, and on June 14, 2009, for current members. You don't need to do anything to accept the new User Agreement. If you don't wish to accept it, you can follow these instructions to close your account.

Sincerely,
Scott Shipman
Senior Counsel
eBay Inc.

 

For the casual reader, these are eBay User Agreement sections being referenced:

http://pages.ebay.com/help/policies/user-agreement.html

Buyer Obligations:

• Buyers agree to file claims in accordance with the conditions, exclusions and coverage limitations as further explained in the eBay Purchase Protection policy.

• For covered claims that meet the conditions and are not excluded, eBay will reimburse eligible buyers by PayPal or by coupon redeemable on eBay, in eBay’s discretion, based upon a number of factors, such as whether the buyer has a PayPal account, the type of payment made to the seller and the payment amount.

• Buyers who eBay believes are not acting in good faith, abusing the program or a seller, attempting to commit or committing fraud, or trying to unjustly benefit from the program may become ineligible for eBay Purchase Protection. Buyers who become ineligible will be notified by eBay prior to ineligibility.  eBay reserves the right to temporarily, indefinitely or permanently suspend the eBay Purchase Protection program immediately if we suspect abuse, excessive claims, tampering, or interference with the proper working of the program.

• eBay Purchase Protection doesn’t cover certain types and categories of goods or services, false, abusive or illegitimate claims, or transactions where you have been or may be compensated from another third party. Please read the eBay Purchase Protection policy for more details.

 Seller Obligations:

• Sellers agree to follow the program requirements as explained in the eBay Purchase Protection policy.

• All sellers with an open claim must work in good faith to resolve the claim, refund money and/or provide a replacement item, and accept a return of the item as explained by the eBay Purchase Protection Policy.

• If a seller doesn't resolve a claim, the seller agrees to pay eBay the amount paid by eBay to the buyer in accordance with the eBay Purchase Protection policy. eBay will invoice the seller for these amounts and seller agrees to pay eBay in accordance with the invoice terms.

Obligations when a buyer opens a claim alleging an item is counterfeit:

• Sellers shall work with the buyer in good faith during the resolution process to provide buyer with appropriate documentation or other assurances to satisfy the buyer that the item is not counterfeit, if such information is available.

• If buyer and seller cannot agree that the item is not counterfeit, for covered claims that meet the conditions and are not excluded, buyers are required to send the item back to the seller. Cost of return shipping will be paid by the buyer or eBay in our sole discretion, unless otherwise agreed upon by the buyer and seller.

• Covered claims that meet the conditions and are not excluded will count as a violation by the seller of our prohibited and infringing items policy.

• Sellers shall not list, advertise, or cause that item to appear for sale, barter or trade, on any eBay Inc. (including our subsidiaries, joint ventures, and other members of the group) web site or service located around the world.

• While buyers are not obligated to provide third party confirmation that an item is counterfeit in order to open a claim, in cases where there is written confirmation from the manufacturer that the item is counterfeit, or in additional circumstances where eBay elects to exercise its discretion, eBay may request the destruction of the item by an authorized third party and at eBay’s expense.

Let us briefly go through the new legalize.  Keep in mind that legal documents are written to minimize, or eliminate, vague, and subject to multiple interpretation, language.  At least that is the goal.

Condensing the above counterfeit section down to a more understandable form:

• "If buyer and seller cannot agree that the item is not counterfeit" this "will count as a violation by the seller of our prohibited and infringing items policy", and "buyers are not obligated to provide third party confirmation that an item is counterfeit".

Same as Scott Shipman's announcement, got it?

This part is solid:

• "in cases where there is written confirmation from the manufacturer that the item is counterfeit"

However there remains more language that eBay's legal team must clean up.  Which is not necessarily Scott Shipman's pervue. See http://news.ebay.com/team.cfm Michael Jacobson, eBay Senior Vice President and General Counsel.

Take a look at this:

• "or in additional circumstances where eBay elects to exercise its discretion, eBay may request the destruction of the item by an authorized third party and at eBay’s expense."

Read it very carefully.  eBay can destroy seller property when "eBay elects to exercise its discretion".  This part does not clearly explain "discretion".  In less legalize, "discretion" could be very very very very loosely replaced with 'whim'.

This has a bit more clarity:

•  "eBay may request the destruction of the item by an authorized third party".

But lacks the explanation of what happens should eBay NOT request destruction.  Because of the word "may", the statement can be interpreted as:

• "or in additional circumstances where eBay elects to exercise its discretion, eBay may or may not request the destruction of the item by an authorized third party and at eBay’s expense."

Consider what happens in the event that eBay does NOT request destruction of the item?  Do you know what happens to the seller's item?  There are multiple possibilities, indicating that this part is vague, and NOT clearly written.

Eventually eBay's legal team needs to put in a list of authorized third parties that will be used for destruction.  That is fairly minor though.

This part is not minor:

• "at eBay’s expense."

This CAN be interpreted as, 'eBay will pay for the cost of destruction'.  Fine, but incomplete.  Remember IN CONTEXT "at eBay’s expense" refers to the cost of destruction PERIOD.

Lets revisit the original issue in the original User Agreement.  eBay makes the buyer whole and pays for destruction of a seller's item, but THEN who ultimately pays for the money given back to the buyer?  The rewritten user agreement remains ambiguous or missing in this matter.

Consider what happens when a seller resolves the claim in good faith, informs the buyer to return the item for a refund, the buyer maintains the item is counterfeit, and eBay chooses to "exercise its discretion"?

• "If a seller doesn't resolve a claim, the seller agrees to pay eBay the amount paid by eBay to the buyer"

Is it likely that this provision, under Seller Obligations, would be applied whereby eBay unilaterally chooses to "exercise its discretion", declares the claim is not resolved, and eBay has the now seller's item destroyed?

• "eBay will invoice the seller for these amounts and seller agrees to pay eBay in accordance with the invoice terms."

Anyone notice there is more 'whim' in the new rewritten user agreement?  Is this deliberate or an oversight?

And as William Cobb would put it, soooo Is there more?  Yes. 

Think it's time to hit to personally hit the word processor Michael Jacobson ESQ, and clean up this mess?

 

"It's sort of an obsession with me to do the best I can for a client. My clients aren't blameless. Many of them are crooks. Probably a lot of them are guilty. That's not for me to determine. That's for a jury to determine."
Perry Mason

"The character of every act depends upon the circumstances in which it is done."
Oliver Wendell Holmes JR, U.S. Supreme Court

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The "DESTROY ALL COUNTERFEITS!" is homage to the Toho Company movie "Kaiju soshingeki" or "Destroy All Monsters!" (1968).

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eBay Media Center - Senior Management
http://news.ebay.com/team.cfm

Michael Jacobson
Senior Vice President and General Counsel, eBay Inc.

Download image

As senior vice president and general counsel at eBay, Mike Jacobson's responsibilities include overseeing eBay's legal department, its risk management program, and its policy group. He is responsible for interactions with content regulators, law enforcement, contracts, SEC compliance, and other legal matters. Prior to eBay, Mike was a partner with Cooley Godward LLP where he was recognized as an expert in securities law. His responsibilities included corporate and securities transactions, including mergers and acquisition transactions, public offerings, and venture capital financing. Mike earned a Bachelor of Arts in Economics, Magna Cum Laude, in 1975 from Harvard College, where he was a member of Phi Beta Kappa. He subsequently received his law degree from Stanford University in 1981, where he was a Nathan Abbot Scholar and a member of Order of the Coif. He also received the Hilmer Oehlmann Jr. award as well as first and second year honors.

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Notable Comments

. 

Questions over eBay's New Fakes Policy
by: Grab your torches

Wed May 13 14:28:53 2009
Just calm down, you silly people
When the smoke that you yourselves are generating clears, you'll see that a third party verification is needed. This system is already in place and has been used for a long time.

 

.

4343martino ( 1851) View seller's items | View Blog Well fer sure...every buyer is a honest upstanding citizen of what ever third world country they happen to be in..You should know that by now world-secure....there never has been or ever will be a dishonest e-bay buyer...they dont exist..not in this world or the next..just ask e-bay they will tell ya...LOL>>>What a crock of sh*t e-bay has created with this one..chalk up another one for the lawyers...LOL>>> Mark May-13-09 15:27:25 PDT

 .

 

Questions over eBay's New Fakes Policy
by: Grab your torches
Thu May 14 13:45:31 2009

So much hype here.
Where does this false info about mailing counterfeits come from? It is illegal to sell them, yes. Illegal to use USPS to sell them, yes. NOT illegal to use USPS to send them to be authenticated/destroyed.
The eBay UA only states that a buyer must "confirm" that a counterfeit has been destroyed. It says nothing about the manner of that confirmation. The current process for a destroying a counterfeit is not spelled out either. Do you assume this means the buyer just has to say they did? No, they ship it to Texas, where it is supposedly destroyed if counterfeit, or resold if authentic. Is there any reason to believe that this won't be pretty much the same thing?

Any idiot knows that if all eBay will require is a buyer saying they destroyed it, then this cannot possibly be legal. Why then, do you all believe this is what eBay is going to do?

It seems much more likely that the user agreement is being left deliberately vague, for any number of reasons.

I swear, Ina could tell you that eBay Singapore was adding a category for human trafficking and you would all eat it up and repeat it everywhere.
Clowns, all of you.

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Questions over eBay's New Fakes Policy
by: Grab your torches
Thu May 14 14:18:52 2009

 

 

Why doesn't somebody here just go ahead and buy a fake purse? Do it. You'll be making the world a better place removing a counterfeit. Much better than reporting it, getting the listing removed so the seller can peddle it somewhere else. Actually buy it and the fake seller is out the money and the counterfeit.
Now, tell eBay it's a fake and see what they ask you to do.

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Questions over eBay's New Fakes Policy
by: Grab your torches
Thu May 14 15:04:12 2009

"If ebay doesn't want incorrect information floating around about ANY of its policies, then the policy should be completely transparent and 100% of it posted."

Seriously? This is a defense?
I would like a little more clarity over this policy as well, but that DOES NOT JUSTIFY MAKING THINGS UP!

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Questions over eBay's New Fakes Policy
by: Grab your torches
Thu May 14 15:11:55 2009

Some secret policies are good.
The list of words in a title that restrict how many of a certain thing you can sell, for example. Make that known and people selling counterfeits know exactly what to avoid.
Exactly how best match works also. Remember when some unscrupulous sellers figured out to put NEW NEW NEW in the title to push their items to the top?

While I do not see the logic behind their vagueness in this case, I wont deign to say that it does not exist. I can't say with any certainty that 100% transparency wouldn't create an opening for the counterfeit sellers to abuse.

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A "Pay with PayPal" Requirement On eBay End Of Auction Message

A "Pay with PayPal" Requirement on eBay End of Auction Message
13 May 2009
EventHorizon1984
Commentary

Nothing like watching eBay push for an investigation of PayPal due to Sherman Antitrust violations.

For a good part of the this year and up until the second weekend in May, after a buyer made a purchase on eBay.com, that buyer received a standard End Of Auction email.  And that email started like this:

Dear **customer**,

Congratulations! You committed to buy the following item:Check out and send your payment now to get your item within 4-5 days.

But beginning the second weekend in May 2009, eBay altered the message text.  The brand new payment message looks like this:

Hi **customer**,

We hope you enjoy your latest purchase. The next step is pay the seller.
Don't wait. Pay now to get your item within 4-5 days.

Pay with PayPal, the safe and easy way to pay for your eBay purchases.

 

It does not matter whether a sellers uses direct credit card processing through a merchant account, or one of eBay's straw dog alternatives like ProPay, Moneybookers, Paymate, the buyer will see "Pay with PayPal".

This is what eBay defines as "convenient payment options".  That is "convenient" to eBay equals "Pay with PayPal".  Or maybe 'Any eBay seller can have a any payment method they want so long as it is PayPal.'

 

"Any customer can have a car painted any colour that he want so long as it is black."
Attributed to Henry Ford 1909

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Comments

tryork5ifp ( 262) View seller's items | View Blog first there was paypal.......then toothbrushpal.....Now there's vegetablepal and genetaliapal!!!! when will eBAy STOP!!! May-14-09 12:22:52 PDT

mylegacy-treasures ( 800) View seller's items | View Blog eBay will stop when they have become the 'we-own-the-world-pal' and Mr. "D" can go to his country club without being embarrassed to admit that he manages a multibillion dollar corporation named eBay. (psssst - don't look at the share price) May-14-09 12:39:46 PDT

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