Imagine this. You own a web-based business selling everything
from nutritional supplements, to skin cream, to jewelry to
consumers. Your website's registration page has a checkbox with
text alongside it. In large font, the text says, "By
purchasing a product and checking this box, you agree to the Terms
of Use, including its mandatory arbitration and a class action
waiver provisions. The hyperlinked Terms of Use explain the
provisions in more depth.
All is good. You're selling products, your customers are happy,
and you're making money. One day, a process server knocks
on your door. You've been served. A consumer class action
complaint has been filed in court against your business. The
complaint could allege that your advertising was deceptive, that
your product was defective, or that your continuity re-billing is
unlawful. You know the claims are frivolous but you also know that
even frivolous class action litigation can be expensive.'
