Yet Again, Netflix Class Action Shows That Class Action Lawsuits Are Mostly About Making Lawyers Rich
from the not-stopping-people dept
For years, we’ve been pointing out that our class action lawsuit system is broken. It makes sense, in theory, that if a large group of people are wronged, they can team up to right that wrong—but in practice it has morphed into a system where a bunch of bottom-feeder lawyers sue just about any company at every opportunity… and then those lawyers end up taking the bulk of the money. The “class” (the people supposedly wronged) rarely get much, if any money at all. Of course, one of the first stories that clued me into all of this involved a settlement in a class action lawsuit against Netflix way back in 2005, in which the lawyers got $2.5 million… and everyone in the “class” just got their accounts upgraded for a month (and if you forgot to manually downgrade after that month was over, you were charged more). As I noted at the time, this seemed more like a promotional stunt for Netflix and a way for a bunch of lawyers to make a ton of money.
So it’s interesting to see that with yet another class action lawsuit being settled involving Netflix, there are similar concerns. A whole bunch of folks sent in variations on the fact that Netflix will be paying out $9 million with a grand total of none of it going to the class (unless you happened to be one of the two named plaintiffs — Jeff Milans and Peter Comstock — who get to split $30,000). Most of the money is going to a charity. But somewhere around $2.25 million is going to the lawyers.
To be clear, I think the lawsuit itself is a bit silly anyway. It involves the fact that Netflix retained info on customers who quit. Big whoop. But whether or not you agree with the premise of the lawsuit, the end result seems even sillier: those supposedly “harmed” get nothing, but the lawyers walk away with over $2 million? It’s this kind of thing that creates incentives for more such lawsuits driven by law firms in the hopes of cashing in.
Filed Under: class action, lawsuits, lawyers, settlements
Companies: netflix
Comments on “Yet Again, Netflix Class Action Shows That Class Action Lawsuits Are Mostly About Making Lawyers Rich”
Cue anti-google tinfoil hatters who try to tie this to “big search”
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Are you trying to tell me that Netflix isn’t run by Google? I thought Google runs the Internet and everything on it. =P
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Sure they do, they even ran an anti-sopa protest using their botnet…
What about the fact that the record labels who sued the Piratebay in Sweden plan to give any money received from the TPB guys (if it is ever collected, which is doubtful) to the IFPI for anti-piracy campaigns, and not to the artists?
Sounds like the Limewire case all over again.
Yes
I agree completely. Check out the same sentiment at http://www.mysettlementclaims.com/blog/
Re: Yes
And you can get actual money from class actions there. At the main database – http://www.mysettlementclaims.com
Re: Yes
Why the reporting?
Re: Re: Yes
Reporting is not just for offensive posts!
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Re: Re: Re: Yes
But wait! That’s not all… We’ll include TWO spams for the price of one, only pay separate shipping and handling.
That’s 2 spams for three easy and one complex payment of $9.99. Act now! Operators are standing by!
Speaking of Google, I got a 60 cent settlement check in an Adwords related class action suit several weeks ago. I just happened to have a couple of other checks to deposit so I went ahead and cashed the stupid 60 cent check.
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I’ve never used a cheque myself in my life, but…don’t they cost more than 60 cents to cash? So…in order to receive the 60 cents, you would have had to pay more than that?
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Checks are free to cash if you have a bank account at most US banks / credit unions… if you want to cash it at say… Walmart they charge you somewhere around $3 for up to $1000 check.
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You can buy gum. Do not disdain gum. Surely the lawyer can probably buy an yacht but everybody wins in the end.
Thank Christ we don’t have these silly things here in the UK.
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Christ made the laws in the UK? I thought he only made the laws in the midwestern and southern US.
He really is all-powerful, huh?
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you are confused between Christ, and the Midwestern and southern Christan religon, the first had nothing to do with the later.
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Yet
“(and if you forgot to manually downgrade after that month was over, you were charged more).”
I worked at Netflix as a CSR in their call center when the settlement upgrades were done and they automatically downgraded when the month was over.
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If this is true, it might be the first customer friendly decision the management team made in the past 3 years.
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It’s been a few years, maybe almost 3 now. I left around the time when they stopped acting like a start-up and started acting like a big corporation. They hired a bunch of managers who only had experience with retail stores and up-selling, who focused on call stats instead of customer satisfaction and that really drove down morale. Before that we were actually empowered to make customers happy.
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I was a customer at that time and was never charged for upgrades after the month. Another case of sloppy “journalism”.
I got the email about the class action (several year Netflix subscriber) http://videoprivacyclass.com/
Would it be worthwhile at all to object to the settlement on the ground that the attorney fees are unreasonable?
Re: Rubbish
I got that email too–went to the website…
There is no way to do anything. No info on how to object or remove yourself from the suit. It’s rubbish.
Re: Re: Rubbish
You remove yourself by sending a letter to the court; there’s contact information in the FAQs. I’m confused, though, because the site’s footer says “Please do not contact either the Defendants or the Court about this Settlement.”
Re: Re: Re: Rubbish
Usually there is an appointed administrator that class members are suppose to deal with for submitting claims / withdrawing.
Re: Re: Rubbish
Yes there is… You have to click on the “Common Questions” link on the side. That page has instructions on how to Object or Remove. Both require you mail a letter…
Don’t know about you, but I don’t care enough to actually sit down and write a letter about this non-sense…
Re: objection to settlement
My question too. Unfortunately, one has to remain a part of the suit in order to object. What a joke.
If ALL of the charity went to something like the EFF, I’d feel much better. Unfortunately, there’s currently NO indication as to what charity the money is going to be directed.
Congrats to the lawyers at Edelson McGuire! Good job making the wrongdoers pay. Don’t mind all the haters and whiners here. They have nothing better to do but whine about everything.
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While I am happy the lawyers got paid, getting an exorbitant amount at the expense of those that the court decided were wrongs, seems a bit bad. You don’t agree?
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Why is that bad?
I’m assuming “wrongs” was meant to read “wrong”
If “wrongs” was meant to read “wronged”, then what makes you think the lawyers’ cut is at the expense of the wronged (who would be getting nothing *and* subject to the same behavior in the future if not for the lawyers’ filing suit)?
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While I am happy the lawyers got paid, getting an exorbitant amount at the expense of those that the court decided were wrongs, seems a bit bad. You don’t agree?
Well, I’m confused. Mike says this: “To be clear, I think the lawsuit itself is a bit silly anyway. It involves the fact that Netflix retained info on customers who quit. Big whoop.” But then at other times, he’s livid when privacy laws aren’t broader or better enforced. Seems like he was willing to brush over the privacy violation on Netflix’s part just so he could whine about the attorneys’ fees.
I don’t know the facts here, but usually when there’s cy pres like this it’s because it’s not economically feasible to pay each member of the class. Money going to charity is a good thing. NFLX having to pay for violating federal privacy law is a good thing.
I got the letter as well and suddenly felt like an artist with a life time contract with a big label….Lawers get the money they are fighting to get for me…
“To be clear, I think the lawsuit itself is a bit silly anyway. It involves the fact that Netflix retained info on customers who quit. Big whoop”
If that is true, and normally i agree with the things mike brings up, but this time i have to disagree wholeheartedly with your stance on this
I dont think its okay to have personal information stored about you, especially if you dont know about it and have not given express information, so basically the way the internet is run today
Opt-in, never by default
Unless there is a clear message that something as small as this is unacceptable, well then thats equivalent to giving permission to governments to expand
I cant believe you dont see that possibility mike, however slim, its still a baby step into that possibility, and i dont mean to have a go, because normally we are of like mind on most issues, but im a little surpised about this one, but, unlike some people i can respect that, thats your opinion, but i cant say i agree at all
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Edit
“I dont think its okay to have personal information stored about you, especially if you dont know about it and have not given express !!!!PERMISSION!!!, so basically the way the internet is run today”
My bad
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It is amusing how Mike completely brushes aside the violation of federal privacy laws.
I’ve been invited to participate in a few class-action lawsuits, mostly pertaining to the amount of interest being charged by my credit card company, or some such.
The letters usually suggest I might win as much as… enough for a couple meals at McDonald’s.
I always wonder why I should bother? Maybe somebody who is bored and has absolutely nothing to do or particularly feels a need to “stick it to the man” might bother, but I never put more than enough energy into it than to read the letter, and then shred it. Or maybe file it with my receipts for the month.
Of course, if somebody were to send me a letter like that suggesting I might actually pocket enough to make it worth my while… I’d probably figure it was a scam and shred it anyway.
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In most cases it is no bother at all. Rather, you have to opt out of the action if you want the option to file your own independent suit.
The only case I’ve ever seen where you had to take positive action to get a cut was a credit card case where you had to say how much time you spent outside the U.S. during a certain time frame.
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I think they have to prove there is a “class” and present how many were affected. Most of the time it’s not enough to take to the bank. Usually it’s the principle that what they are doing is wrong and the company isn’t going to stop until forced to.
Epson had a class action against it because their ink was designed to “run out” before the ink had run out. That gets expensive particularly since Epson required their own brand of micronized ink to work. I got a set of free cartridges (whooppee) out of the deal – and bought Canon next time.
But that was pretty shifty of Epson to do. Same with the credit card company padding the exchange rates. They had to stop doing it. I think of class actions more like signing onto a petition with more bite.
— copied from the twitterverse:
“Class action lawsuits are gangs for white people.” – @zgbetty.
Isn’t it the JUDGE who determines the amount of the award and who gets paid?
Wouldn’t that be “industry standards” for most legal teams? If so, I don’t see the get-rich-quick scheme here since most class actions require years to get to court, investigation, multiple offices, etc.
I don’t work with law but with all the talk about “tort reform” I started paying attention a few years ago.
A lot of these cases, particularly with the bulk being given to charity, aren’t about getting restitution for victims but serve to enforce laws that exist when other methods fail – such as regulatory agencies.
They are designed to teach a company “a lesson” by hurting them in the pocketbook (whether the costs are passed on to consumers is something else).
There was a case against the majority of sunscreen manufacturers for misleading claims, regulated by FDA – cases of skin cancers rose because of the misinformation. The bulk of the award went to charity. Yet the case changed sunscreen definitions, advertising, etc.
The tobacco awards didn’t go to victims. The money funded all sorts of things for the states. I can see the same thing happening with the case against mortgage lenders that was recently signed off on. The goal was to change the way manufacturers/lenders/companies did business and it was usually 1) against the law, 2) failed to be enforced through any other method, 3) last resort.
I’m not a lawyer but I assume that’s why the RIAA turned to class action suits – and why they failed, as they should have. The tables can turn at anytime, but the lawyers fighting class action suits for the John and Jane Does are more like heros and I bet they earned every penny.
But even in those cases, I thought it was the judge that set the fees the lawyers would get, win or loose.
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RIAA has not filed any class action suits, to my knowledge.
Usually, the parties agree to a settlement, which the judge has to approve. The judge doesn’t just decide.
Funny, I thought that was a feature.
A long time ago, I left Netflix for several months. When I signed back up, my queue was intact. I thought it was awesome. Never once did it cross my mind to sue for it.
CRAZY
Glad to see this article. So pissed at these frivilous law suits that the people (lawyers?) seem to “make up” to get themselves money.
If the settlement is approved, the subscribers won’t get anything (not even a one month upgrade this time) but the LAWYERS will get a HEFTY $2.25 MILLION PLUS EXPENSES for working so hard to ensure that the evil Netflix will delete our old viewing history after a year AFTER we stop subscribing?!!!
Something seems wrong. The complaint was only filed in September, so it’s not even as if it was a long negotiation.
Charities will get about 6 Million, which you can’t really complain about…. but –here’s an idea– wouldn’t it be even better if the lawyers waived part of their fees so the charities could get MORE? I mean $1 MILLION + EXPENSES for their “hard work” seems more than adequate.
What is really going on here? I’m curious: Does anyone know if the “plantiffs” usually (legally?) get a kickback from the law firms?
The problem is the same with this as most class actions, the people that were supposedly wronged get nothing, instead THE LAWYERS get it OR any “charitable non-profits”. Also keep in mind there are MANY “501-c3 SuperPacs out there, they are non-profit and will go to support the candidates of their choice. How do we know the money isn’t going to them? The laws need to be changed to first, end this Opt out BS. It should be Opt IN ONLY. Second, 95% of any fines or rewards should go to those injured, not just the named people and most of all the scumbag attorneys.
I never opted IN to this class action and they have zero legal right to automatically opt me in. In fact the attorneys for the plaintiffs violated my privacy rights by getting my information in the FIRST place, maybe we need to get together and file a class action AGAINST the plaintiffs Attorneys for VIOLATING our rights. Much less making it really hard to opt-out. Since the statement only came in email and not certified mail, I will consider that I was NOT legally informed and if I am barred from filing against Netflix if I so choose, I will sue the plaintiffs and their attorneys. All this accomplishes is the scumbag lawyers making a lot of money and us “victims” paying more for the service because of it. What we really need is more dead lawyers.
I received a notification about this lawsuit because I’m a Netflix customer and I went to the website with the details about it and read EVERYTHING. After I was done, I thought exactly what you said in this email. It’s so obvious. The attorneys probably found some guys on the street and made them plaintiffs. (“Wanna make a fast 5 Grand?”) It did say there are about 6 plaintiffs total (not just the two named), so I’m figuring they’re going to get $5,000 each. For probably not caring about their privacy in the first place, and then doing nothing. I believe $2.25 million goes to the attorneys….. Bah.
Couldn't agree more.
I was just about to say pretty much everything Docd said above. These idiots cry violation (and I think it wasn’t even close), and in the same breath do the same thing themselves by acting on my behalf and, without my permission, including me in something I don’t believe in and would laugh out of court if witness to. My first thought was, you betcha, I’d love to sue THEM to make a point.
Wow really?
I just got an email saying I am in the class, I don’t feel much in it as I get nothing and these fu**ers get 2.25 mil. and for what, they kept a viewing history, woooow like netflix doesn’t do that already for your convenience to go back and watch it again…
This is another one of Americas finest bs lawsuits all over again and I have to admit, it sickens me for two reasons.
1- I get nothing.
2- It’s frivolous to begin with.
Netflix suit making lawyers rich
Here’s where you can send your dissatisfaction with the Netflix class action suit making millions for lawyers and nothing for the class:
http://www.edelson.com/insidethefirm/#page_4
Re: Netflix suit making lawyers rich
I ended up here because I too received the email and was so infuriated by it that I was actually looking into who these two named plaintifs were and how I could make my objection to what these shady lawyers are doing heard loud and clear … I agree that privacy should be the default etc. etc. but whether Netflix broke the law or are using bad practices is moot in my opinion … yes, they should get a smack and be made to comply, that’s a no brainer … but, what these lawyers are doing is sets a more dangerous precedent than any judgement against Netflix.
I am sick to death of greedy lawyers who do absolutely NOTHING that benefits anyone but themselves … this is what the law is in America these days … it is a really really bad joke … The amount of money being paid to them for this is shameful and offensive, hell, the amount of money being charged by lawyers these days all but assures that no “little man” who is truly being wronged and needs help will EVER be heard. I know … I’ve been that little man many times over and have not been able to afford to properly defend myself even once. The only satisfaction I have ever received from the law has come from being able to represent myself in small claims … how convenient that us do it yourselfers get capped at 5,000. I have a woman who has stolen 35,000 worth of merchandise from me and in order to get any justice for this I have to file small claims and hope to be awarded 5,000 in damages which this criminal will obviously never pay. I’m ranting right now because this is how angry I am at this “law for the rich and rich are the law” state that we live in. The Matthew Effect is in full swing on these United Shores . I cannot even vocalize my disgust properly with the limited words available to me in my native language.
In this instance it is MY privacy that was violated. I believe that the lawyers should be regulated to be paid a specific percentage of the award they obtain for the wronged and I believe the wronged in this day and age can take a majority vote on whether to give that money over to programs or charities should they wish too. My experience has taught me that most non-profits are even more shady than the lawyers in this country. Altruism exists behind a human heart, not a large table with directors and board members … that concept is simply fantastical hypocrisy we allow ourselves to believe in order to subdue our own guilt at not putting any of our own time toward helping anyone else.
Most mind blowing of all? The lawyers at this firm made a conscious choice to use a photo of themselves playing wii games on their big screen TV as the only visual image on their home page website. Seriously … mind officially blown. I believe this says it all.
I will be objecting to this case and I encourage you to do the same … just write a letter, that’s all it takes. I don’t care if you have to scribble it in crayon … just do it. Stop being a pawn in this vile game of greed.
Class action re: netflix, WHO AUTHORIZED FIRM TO REPRESENT ANYONE OF US ?
ND OTHERWISE
without written consent, client notifications(s) MALFEASANCE, + A LOT MORE
In most places we must authorize a and give a lawyer WRITTEN CONENT!! AND AUTHORIZATION !! TO MOVE ANY CIVIL CASE INTO A COURT ACTION OUR PERMISSION MUST BE THERE OR IT SEEMS LIKE THE LAW FIRM REPRESENTED EVEYONE IMPROPERLY, WITHOUT ANY PERMISSUION, KEPT 2 MILLION IN CASH, SETTELED A CASE WE CLIENTS CAN NEVER GO INTO COURT AGAIN ABOUT !!. OF COURSE IF THEY WENT AND GAVE OUT CLIENT SETTELMENT AWAY WITHOUT OUR PERMISSION, INFORMED CONSENT AND AGGREMENT BEFORE ANYTHING WAS SIGNED. THAT WOULD BE SEEN AS WRONG, ILLEGEAL, A CRIMINAL ACT ABUSTNG THE LAW AND REPRESENTING AND SETTELING A CASE WITHOUT EVER BEING LEGALLY AUTHORIZED IN THE FIRST CASE, LIKE ALL OTHER LAW FIRMS MUST DO ?.AND WE NEVER EVEN WERE TOLD NORMALLY A LAWYER WHO SETTLES FOR 2 MILLION CASH AND GIVES AWAY THE “CLIENTS” SHARE WITHOUT EVEN TELLING THE CLIENTS EVERY SETTLEMENT OFFER. WOULD BE DOING THINGS “THE WRONG WAY”. MALPRACTICE, CONPRIRACY, STEALING, ABUSING THE CLIENT AND WOULD BE CHARGED WITH CRIMINAL ACTS. SO IF ONE DAY WE FIND THAT SMEONE DID THIS TO ANY OR ALL OF US, THEN TOLD US BY EMAIL WITHOUT EVEN IDENTIFYING THEMSELVES OR THERE BAR NUMBER AND ADDRESS, AND NEVERHAD OUR CONSEN TO START WITH. THEY WOULD BE IN TROUBLE AND FINISHED AS LAWYERS AND GO TO JAIL. BUT THIS CAN’T HAPPEN TODAY RIGHT !!!!
objection
It’s a shame that more people don’t take the time to sit down and write a letter to object. I did and explained why on my blog.
http://nytechlitigation.com/netflix-privacy-lawsuit-objectionst/
opt out / object to netflix settlement
A nice guy wrote a hefty response letter that you can print and send to the court. It pretty much lays the smack down. He objects to the settlement, explains why, says what the settlement should be instead. And removes himself from the class. You put in your name and info, and bam. Print and sign.
http://www.thewiseguys.com/2012/07/27/netflix-class-action-lawsuit-settlement-screws-members/#comment-377
every minute
I answer phones for a law firm that received a call from a young hoping to find someone to represent him in this lawsuit. Inside I was help thinking what an opportunistic and misguided douche he was, but I risked getting fired if I told the guy, even in the nicest way not to waste his time. Oh well, he’ll get what he deserves…absolutely nothing.