Man Sues Gateway Because He Can't Read EULA

Scoopy writes "California resident Dennis Sheehan took Gateway to small claims court after he reportedly received a defective computer and little technical support from the PC manufacturer. Gateway responded with their own lawyer and a 2-inch thick stack of legal docs, and claimed that Sheehan violated the EULA, which requires that users give up their right to sue and settle these cases in private arbitration. Sheehan responded that he never read the EULA, which pops up when the user first starts the computer, because the graphics were scrambled — precisely the problem he had complained to tech support in the first place. A judge sided with Sheehan on May 24 and the case will proceed to small claims court. A lawyer is quoted as saying that Sheehan, a high school dropout who is arguing his own case, is in for a world of hurt: 'This poor guy now faces daunting reality of having to litigate this on appeal against Gateway...By winning, he's lost.'"

EULAs are not meant to be read

Seriously. Have you? Can you keep a straight face and tell me you read all those legalese crap? I didn't.

First of all, it can be summed up into "We may do everything, you may do nothing, essentially, you're a dork for using our software". And second, almost all of them violate our consumer protection laws.

So, why bother wasting time?

Re:EULAs are not meant to be read

The thing that irritates me most is installers that force you to read and agree to a Free Software license before using the program. Free Software licenses are distribution licenses, not EULAs, and so there is no need to agree to them, or even read them, before using the software.

Re:EULAs are not meant to be read

Mod parent up. An author who makes the GPL/LGPL into an EULA for their program clearly doesn't even understand the license at its most basic level.

Re:EULAs are not meant to be read

Amen. Unfortunately, that includes such prominent packages as the Windows binary installers for Pidgin and OpenOffice. OOo is particularly bad in that it forces you to read and accept the LGPL before installing. Stupid, stupid, stupid. I'll read the license when I want to do something that's not already implicitly legal, thanks. Stamp it with an open-source logo or something if you want to advertise the fact that this is OSS and not just freeware. Don't propagate the notion that I need your permission to run your software.

Re:EULAs are not meant to be read

Absolutely. I am almost done reading an EULA on my other PC. When I am done, I look forward to finishing building my Win 95 system, working off of 3.1 sucks!

Small Claims

I'm sure someone will set me straight if I am wrong, but in small claims court, doesn't the complaintant always represent themselves? And that court is structured to deal with such?

California Small Claims Process

This was actually a pretty big win for him, and it means that the case will not drag on for years as the article suggests.

In California Small Claims (which this case was just kicked down to), an employee or executive of the company must be present at the trial - not a lawyer, and not somebody hired specifically for the purpose of defending the small claims suit.

If the defendant loses, there is exactly one possible appeal. At the appeal (to superior court), lawyers can appear, but the case is still treated as a small claims case (i.e. you aren't going to get out of it based on a legal technicality if that technicality violates the basic fairness of the case).

If Gateway doesn't send an employee, the appeal is going to be much harder because they have some pretty serious explaining to do as far as why the appeal should be heard. If they do send an employee, it is still tough because no new evidence can be presented at appeal so they will basically have to say that the judge was wrong and why.

Either way, this guy will have resolution within 120 days at the far side - as the appealin California for small claims must be filed within 30 days of the case being heard and if the appeal is approved, they put it on the docket pretty quickly.

critical mass

I believe that we may be approaching critical mass (in decades or centuries, not years) within the imposition of legal absurdity upon humankind. I expect that the populace will ultimately become so oppressed by the duress of corporate greed that uses legal thuggery as it's enforcer, that humanity will just quit accepting it and reject the entire premise of law.
If there is wisdom within the world of corporate law, someone will realise that this is approaching and will work for internal reform, before external reform arrives as a consequence of insults to humanity like this.

Sorry but...

poor guy?

Poor guy? Yes, create more pity for him. After all, you sold him a defective computer, then refused to fix it. Then let the situation make it all the way to small claims court. You've got him right you want him.

Not easy being a computer user

Being a computer user is really tough sometimes: Not only do they expect you to be a computer expert, but they also expect you to be a legal expert.

Somebody please explain

> the EULA, which requires that users give up their right to sue

Is it even possible in US to get in such agreement? I am Polish. ;) I don't know much about US law system but the whole idea looks awkard. In my country you can state whatever bullshit you wish in license agreement or whatever - but it is void unless it is valid with the law. So I could make a license that you own me your liver if you use my software while not drinking milk - but it would be pointless.

It is possible in US to just make a license that disallows you to sue by the other party? That is kind of retarded - even if it is possible - what it is for?

I thought that you _ALLWAYS_ have a right to sue (fight for your rights) and nobody can take it from you?

giving up rights

Ya know ... I'm not a big fan of lawyers and stupid lawsuits ... but I'm getting a little sick of giving up all my rights every time I turn around. I've seen this "agree not to sue, and instead, go to binding arbitration with an arbiter of the company's choice" on all sorts of things lately.

The other day, the cable guy came out. He drops off my HD DVR. He hands me his handheld PC and says "sign here". The thing I'm supposed to sign says something like "I agree to all the stuff above". Of course, I can't scroll up and read anything. So, i ask what I'm signing. He tells me it's that I received the DVR. Grr. OK. So I sign. Then it prints out this huge receipt. Among other things, i've given up my right to sue them.

To make it worse, they often are worded such that you can never sue them for anything ... EVER ... not just in respect to the immediate business. Hopefully that won't stand up in court.

EULA's are not a legal contract

contracts require the ability to negotiate the terms and talk with the other party. EULA's do not allow this. more so ALL eula's are given to you post purchase of software/hardware, which means you've been forced into agreeing to something without seeing the details first, which is not legal under most contract law.

i've always had the opinoin that eula's are not legal, and are just used as a bully tactic. i hope this guy wins.

best hope is a pyrrhic victory?

"This poor guy now faces daunting reality of having to litigate this on appeal against Gateway," Palefsky said. "By winning, he's lost."

So the take home lesson is that the little guys should never attempt to sue big companies? that even if they have a chance of winning, the big guns will put them "in a world of hurt"? this is how the legal system is supposed work?

Re:When you buy a new PC...

Never mind the readability. If I see a hardware EULA, here are the possible results:

• Contract of sale is already closed, EULA is not valid -- end of story
• Contract of sale is already closed, EULA is valid -- computer unfit for purpose for which it was sold (won't compute unless I agree to more limitations)
• Contract of sale is not yet closed, EULA is valid -- I don't agree, so it's refund time

Re:When you buy a new PC...

Generally, yes. Gateway has traditionally included its agreements in the box. Practically this exact same case has been tried before:

http://www.badsoftware.com/hill.htm [badsoftware.com]

A contract need not be read to be effective

From the previous link (an appelate court decision):

A contract need not be read to be effective; people who accept take the risk that the unread terms may in retrospect prove unwelcome.

A vendor, as master of the offer, may invite acceptance by conduct, and may propose limitations on the kind of conduct that constitutes acceptance. A buyer may accept by performing the acts the vendor proposes to treat as acceptance." Id. at 1452. Gateway shipped computers with the same sort of accept-or-return offer ProCD made to users of its software.

Re:When you buy a new PC...

Three words: Uniform Commercial Code [wikipedia.org]

It's a modification to contract law that is intended to make in-box agreements legal. The point of the law is to speed up transactions in cases where the cost involved in drafting a proper contract would negate the value of the transaction. Therefore the law provides the consumer the opportunity to review the contractual information in the form of a pack-in contract, which the consumer is free to reject by returning the product. Using the product constitutes acceptance of the contract.

Given that courts have ruled this legal several times (see: ProCD, Inc. v. Zeidenberg, Carnival Cruise Lines, Inc. v. Shute, and - of course - Rich Hill and Enza Hill, v. Gateway 2000, Inc.), consumers should BE CAREFUL WHAT YOU AGREE TO. If the terms of the contract are considered reasonable, you may be held to them in a court of law.

Caveat Emptor.

Re:When you buy a new PC...

I never boot up a new PC without a Linux installation CD in the CDROM/DVD drive after having first checked the BIOS to make sure that it's set as the first boot device!

So, because I did it this way, I never get to see Gateway's boot screen EULA, therefore I am never bound by it? Or does blowing away the contents of their HDD also violate some obscure law?

Re:When you buy a new PC...

And what happens if you boot it, read the EULA, then decide that you don't agree with it, click 'disagree' and install a different OS (or even Windows from a non-Gateway disk)?

The only possible way in which a EULA would be legal would be if it granted you some right that you didn't already have. The legal technicality that is used by software is that copying the program from the install media to your disk and then to RAM requires extra rights (not valid in all jurisdictions). For hardware, there is no such loophole. If you didn't agree to the contract before sale, then they can't enforce it afterwards.

Re:When you buy a new PC...

... that have the EULA in print?

Actually, thanks to this guy, every Gateway purchaser will have to listen to a .WAV of the EULA played through the speakers (including the motherboard P.O.S.T speaker) as well as read it on the screen.

Re:When you buy a new PC...

if you even read the summary, you'd see that he in fact, could not see an "I agree" button.

Re:???? Lawyers are idiots !!!!!

Bullshirt!!!

Heh, my sentiment exactly when I read that line. If Gateway sends a lawyer to small claims court with "vast legal and financial resources" the judge is likely to put Gateway's lawyer into a world of hurt. As a small claims court judge its more likely that the judge will be unimpressed by big lawyer shenannigans in a common sense small claims court.

Re:???? Lawyers are idiots !!!!!

Exactly. He's already made Gateway spend money not only on his tech support calls, but on a lawyer who doesn't come cheap. At some point, it will be in Gateway's interest to just cut their losses and refund the money. The longer he holds out, the more likely that will happen.

Re:"By winning, he's lost."

Abraham Lincoln would have been proud then.

And these blokes [askmen.com] need to re-evaluate what they are doing in life

Having said that Abe Lincoln probably would have preferred to finish/receive an education.