Last summer, a consumer in Wisconsin filed a lawsuit against online retailer Accessory Outlet over what she called a bogus $250 fine the company imposed, claiming she breached the terms of sale when she threatened to have the charge canceled after the iPhone case she ordered never shipped. Today, a New York court sided with the consumer by granting a default judgement in the case, essentially agreeing that Accessory Outlet’s “terms of sale” and the debt it alleged the woman owed were void.
The default judgement entered in the Supreme Court of New York in Manhattan was handed down after both Accessory Outlet and its parent company Blue Professional failed to appear to defend their actions, Public Citizen, which brought the case forward on the woman’s behalf, reports.
The decision also grants the woman damages under New York’s Deceptive Practices Act for the threatening and harassing emails Accessory Outlet sent her.
“This judgment demonstrates that consumers have recourse when unscrupulous businesses bully, harass or threaten their customers or attempt to fine customers for lawful actions such as disputing a charge or telling others about their bad experiences with a merchant,” Scott Michelman, the Public Citizen attorney handling the case, said.
Judge Robert R. Reed’s default judgement puts an end to an ordeal that started when the Wisconsin resident ordered a phone case through Accessory Outlet on July 6, 2014.
Four days later, she received an e-mail saying her order had shipped. The customer then checked the supposed USPS tracking number of her order and found that it had not been received by the Postal Service.
When the item had not been received by July 16, she contacted the company via its website and requested that the order be canceled. Accessory Outlet replied that it could not be canceled because it had shipped.
The customer checked the USPS tracking number again and then replied to Accessory Outlet that she would be requesting a chargeback from her credit card company because she believed the retailer was lying about whether the order had actually shipped.
That’s when they told her about the $250 fine that she hadn’t agreed to.
The fine, the company said, was part of its Terms of Sale that every customer agrees to when making a purchase.
Though the Terms are on the Accessory Outlet website, at no point in the purchase process is the customer required to check a box or otherwise acknowledge that the Terms have been read.
The Terms page included the following insanely overreaching stipulations (bolded for emphasis):
“You agree not to file any complaint, chargeback, claim, dispute, or make any public forum post, review, Better Business Bureau complaint, social media post, or any public statement regarding the order, our website, or any issue regarding your order, for any reason, within this 90 day period, or to threaten to do so within the 90 day period, or it is a breach of the terms of sale, creating liability for damages in the amount of $250, plus any additional fees, damages – both consequential and incidental, calculated on an ongoing basis.”
The Terms also claim the customer agrees that, even after the 90 days are up, the “sole method of dispute resolution in all cases… shall be binding arbitration to take place in New York City, with all expenses paid by the respective parties.”
Consumerist attempted to verify the Plaintiff’s claim last year that she was never actually provided with the terms. We went all the way through the ordering process (up until actually hitting the “complete purchase” button, of course) and could not find any place in which it was even suggested that we read the Terms before placing an order.
In a subsequent correspondence with the woman, the company asserted that not only would she be hit for the $250 penalty but that her account would be sent to a collections agency, which would “put a negative mark on your credit for 7 years and will also result in calls to your home and/or work.”
Accessory Outlet also threatened her with the prospect of “additional fees for any correspondence with your card issuer… billed to you on an hourly basis and a flat rate $50 fee for the dispute or claim.”
When the customer replied that she had the right to contact her credit card company, the retailer replied that she now owed them “damages” and that her account would be referred to “multiple collections agencies.”
After the woman told the company she would be getting a lawyer, Accessory Outlet retorted that she could “contact your lawyer, spend more time and money if you wish. You will be billed and the amount we bill you for will continue to rise with every email and every second we dedicate to correspondence of any kind pertaining to your breach of the terms of sale. Thank you.”
Following that exchange, the company sent yet another note, this time personally attacking the woman.
The woman reports that she eventually received the phone case – nine days after it had supposedly shipped – but that it had arrived defective and unusable.
That’s when Public Citizen stepped in and sued Accessory Outlet and Blue Professional on behalf of the woman.
Days later Accessory Outlet’s site and others run by Blue Professional were taken offline.
Consumerist did some digging into the company and found that not only did Accessory Outlet subscribe to Terms that charge a $250 fine for customers who even make the threat of publicly complaining about a bad purchase or requesting a chargeback from their credit card company, it touted bogus badges from several consumer organizations including the Better Business Bureau and Angie’s List.
A reader in New York pointed out that the company’s BBB rating was, in fact, an “F.”
The BBB stated in all caps that “THIS FIRM IS NOT CURRENTLY A BBB ACCREDITED BUSINESS,” and that it had been served a cease-and-desist demanding it remove the badge from the site.
We contacted three other organizations touted on the site — Angie’s List, buySAFE, and Trusted Shops — to confirm that these endorsements were also false.
A rep for buySAFE confirmed that Accessory Outlet was not certified.
“The seal you see is an old, bad copy of a buySAFE seal,” explains the rep.
And a rep for Angie’s List said there was no way Accessory Outlet could have won a Super Service Award — which requires perfect scores — because it has no reviews on the site.
“They have no reviews, which equals no grade,” explains the Angie’s rep. “They aren’t SSA winners and shouldn’t be using the badge.”
And a rep for Trusted Shops, which does not certify companies in the U.S. said Accessory Outlet is definitely not certified by the service.
New York Court Vindicates Customer From Whom Online Retailer Attempted to Extort Money [Public Citizen]
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