Netflix settlement on class action lawsuit
 

Got this today. It may interest & affect some of you:

"You are receiving this notice because you were a paid Netflix member before January 15, 2005. Under a proposed class action settlement, you may be eligible to receive a free benefit from Netflix.

A class action lawsuit entitled Chavez v. Netflix, Inc. was filed in San Francisco Superior Court (case number CGC-04-434884) on September 23, 2004. The lawsuit alleges that Netflix failed to provide "unlimited" DVD rentals and "one day delivery" as promised in its marketing materials. Netflix has denied any wrongdoing or liability. The parties have reached a settlement that they believe is in the best interests of the company and its subscribers.

Netflix will provide eligible subscribers with the benefit described below, if the settlement is approved by the Court.


Current Netflix Members: If you enrolled in a paid membership before January 15, 2005 and were a member on October 19, 2005, you are eligible to receive a free one-month upgrade in service level. For example, if you are on the 3 DVDs at-a-time program, you will be upgraded to the 4 DVDs at-a-time program for one month. There will be no price increase during the upgraded month. (If you cancel your membership after October 19, 2005 and before you receive the upgrade, you will have to rejoin to get the upgrade.)


Former Netflix Members: If you enrolled in a paid membership before January 15, 2005 but were not a member on October 19, 2005, you are eligible to receive a free one-month Netflix membership on your choice of the 1, 2 or 3 DVDs at-a-time unlimited program. (If you rejoin after October 19, 2005 but before you receive the free one-month membership, you will receive a credit for the free month when it becomes available.)
These benefits will be provided after the Effective Date as defined in the Settlement Agreement. Your eligibility for the benefits is based on your membership status as of October 19, 2005. The full Settlement Agreement is available for review at www.netflixsettlement.com.

You have four options to respond to the proposed settlement. You have until December 28, 2005 to make your decision:

Option 1. Sign Up For The Benefit As Part Of The Settlement
To receive the benefit, you must complete the online registration process no later than February 17, 2006, at www.netflixsettlement.com. By signing up for the benefit, you waive your right to bring a separate lawsuit against Netflix concerning the Released Claims (as defined in the Settlement Agreement found at www.netflixsettlement.com).

Option 2. Do Nothing
If you do not wish to receive the benefit, do nothing. You will not receive the benefit but will remain a Class Member. You therefore waive your right to bring a separate lawsuit against Netflix concerning the Released Claims.

Option 3. Exclude Yourself From the Class
To exclude yourself from the class, you must mail a letter by December 28, 2005. By excluding yourself, you preserve your right to bring a lawsuit against Netflix concerning the Released Claims. However, you will not get the benefit described above.

Option 4. Make An Objection To The Settlement In Court
To object to the settlement, you must file legal papers in the San Francisco Superior Court by January 5, 2006.

To receive your benefit, you must register by February 17, 2006 as described above in Option 1. You will not receive any other reminders to register for the benefit. If you have registered for the benefit and your eligibility is confirmed, then you will be provided additional information by email following the Effective Date as defined in the Settlement Agreement.

After the benefit period ends, the new or upgraded level of service will continue automatically (following an email reminder) and you will be billed accordingly, unless you cancel or modify your subscription. You can cancel or modify your subscription at any time.

In addition, if the settlement is approved by the Court, Netflix will modify portions of its Terms of Use. Netflix also will refer to its Terms of Use in certain advertisements.

To get more information about the settlement and procedures, and to take options 1, 3 or 4, visit www.netflixsettlement.com."

Seems like an awfully light punishment for not living up to "unlimited rentals and 1 day turnaround".

I think the court should either require Netflix to live up to it's promises or stop advertising/promoting them.

I was a Netflix member a loooong time ago and just filed a claim for the free month. I'll give 'em another try, especially for free.

Note that you have to file a claim and then they will mail you info at a later date. You don't sign up for a membership now (unless you want to pay for a membership now.)

This isn't a punishment handed down, it's a settlement between the two parties. Anyone who actively excludes themselves from the settlement, has the right to sue for the same thing [although even if you did you would quite likely get zilch.]
And NF doesn't admit guilt, this is their "Yeah, we hear you, we don't admit it, but have some free stuff anyway and get off our back" thing.

I got the same email, I'll sign up because I surely am not going to sue them on my own.

I signed up too for the same reason. Heck, I don't even know if I'll take the free month (Former member who is no longer a member), but I signed up anyway.

Pesonally I'm tempted to file my rental record under Option 4 showing I've gotten consistantly good service from them... realistically though I'll probably do #2 ;)

It's interesting that those who stuck around through the bad service (and probably therefore received bad service for a longer time) get a settlement that's worth less than those who threw up their hands and quit.

And with this settlement, does that mean Netflix will give up throttling? Or that they'll quit pretending that they offer unlimited service or one-day shipping?

Of course not, then most people would take the option to exclude themselves and sue. If Netflix had anyway of defending themselves they would but from my experience and in my opinion they are guilty.

Yes, they gave up the terms "unlimited rentals" and "one-day shipping". Read the new terms of use on their site with particular attention to the section titled "Allocation, Delivery and Return of Rented DVDs". At least they are now forced to be honest.

Yeah, I agree, I've rarely had problems with them and the last year or so my service has been consistently excellent. Any excuse to file a lawsuit for some people, I guess....

Some of us have had consistant slow rental times with them. For me on the 3 at a time plan I could only get 3 a week. They would usually leave on Monday, get here on Wednesday or Thursday, and they would be back there on Monday.

I agree with you (and nemein) as well. I've never had an issue since the early days when they only shipped from San Jose. Of course, I do seem to have many varied interests to fill my time other than watching DVDs 24/7 unlike some of these guys apparently.

;)

Or perhaps not everyone receives the same service you do.

I've certainly had significant slowdowns in the past year. Beginning last December, Netflix would wait an extra day or two after receiving a disc to send out a replacement. In the beginning, this only happened on Tuesdays, it then grew to Mondays and Wednesdays, as well, finally getting to the point no matter which day they received a disc from me, the replacement shipment was delayed at least a day. It's only been the past month that I haven't had anything deliberately held a day or two before shipping.

Add to these slowdowns the fact that Netflix would steadfastly stick to the story that they did not deliberately slow down anyone's service and any problems were the fault of the post office, despite how such a claim often failed a simple logic test, and I can see why customers who signed up for the service based on the promise of unlimited rentals might be upset enough to file a lawsuit.

I got the email, so I'll take my free month, though I really don't rent much anyway.

I like how the lawyers got $2.5 million and we get a free month. :lol:

Welcome to the wonderful world of class action lawsuits.

Of course. I just love state of the legal system where it almost makes it not worth fighting something like this, because the only people that make out in the deal are lawyers.

Well, of course the real hope is that the company losing the suit will change their practices and all their customers will benefit.

Settlement Objection
 

Now that's a case of someone having too much damn time on his/her hands. Who actually cares this much that your rentals might take one more day to deliver?

Netflix has consistantly given me great service.

While we're at it, lets sue Burger King and McDonalds for false advertising...I mean, the burgers we get <b>look nothing</b> like the picture on the menu.

= J

Because, in the end, it means you pay more per rental. Anything that increases people's cost is eventually going to end up in court.

Plus, there was the whole sneakiness aspect of it. That Netflix would knowingly slow customers down and then deny it, blaming the post office or whatever else, irked people as much as the act itself.

Once they came clean about what they were doing, I became less concerned about it, personally. But when they were throttling customers and claiming ignorance, it was annoying to the point of wanting to do something about it. Because if you're a renter and all of a sudden, your service declines, you wonder why. And when the company says "We don't know why your service has declined. Must be the post office"... when it couldn't possibly be the post office and gives you the run-around for months and months, claiming they're not doing anything to slow service but seeing the service slow down just the same, it just makes customers more and more angry.

If the Terms of Service always said that their distribution centers had limited output per day and that customers would be served in the reverse order of how often they used the service resulting in some days where the replacement shipments of the heavier renters would be delayed, they wouldn't be making this settlement now.

Instead, they said they were offering unlimited rentals for a set price. They purposely set up a system that kept customers from receiving unlimited rentals. It's no wonder they got sued. It's plain-as-day deceptive. If Blockbuster had done this first, they'd be crucified with no defenders of the company at all. If Wal-Mart were doing something akin to this, some documentarian would be firing up the cameras and hoping for a release in time for awards season. Netflix does it and we talk about how the complainers should get a life beacuse they have too much time on their hands.

Netflix advertised an all-you-can-eat buffet and then limited the amount of food a person could eat. The simple solution was to be honest about what they were offering and how they could offer it. Instead, they lied and deceived in order to inflate their market share and their stock price.

"Once they came clean about what they were doing, I became less concerned about it, personally. But when they were throttling customers and claiming ignorance, it was annoying to the point of wanting to do something about it. Because if you're a renter and all of a sudden, your service declines, you wonder why. And when the company says "We don't know why your service has declined. Must be the post office"... when it couldn't possibly be the post office and gives you the run-around for months and months, claiming they're not doing anything to slow service but seeing the service slow down just the same, it just makes customers more and more angry."

And that's exactly it. They began to throttle customes even before they alerted new customers to their throttling policies in the terms of service. They would put the blame on various other sources so that the consumer spent more time trying to figure why discs weren't arriving in a timely fashion. Netflix even told me to file a complaint with the postal authorities which I did only to discover that the post office was not the problem. Netflix was the culprit, and they denied it repeatedly. They always had an excuse for why a disc wasn't sent out the day that another disc was checked back in. The arrogance in which they handled the situation only increased my anger--"If you don't like our deceptive practices, leave" was the gist of their latest response. I will be leaving once my gift membership is up. You don't advertise unlimited service when your business model ensures that unlimited service is impossible.

I agree. I am still a member so my "settlement" comes out to a value of $6 for a one-month upgrade. There should be some way of having your settlement be related to the number of months you have been a member, since they probably screwed you around the entire time you belonged. I'd take an upgrade for a year, for example, that would be a bit closer to making up for their policies.

Interesting. I like their ideas here.

Anyone noticed netflix started to work faster? My 3 at a time program works like I'm on 6.