Palmer v. Kleargear.com
| Industry | Retail |
|---|---|
| Founded | (2001) |
| Headquarters | U.S. |
Area served | Worldwide |
Key people | William Franklin Bermender (CEO)[1] |
Kleargear is an online retailer that specialises in nerd apparel, geek toys, gadgets and office toys and was founded in 2001.[2]
Controversy
In November 2013, Kleargear suffered a serious Internet backlash[3] after it was reported that they fined customer John Palmer $3,500 after his wife Jen posted a negative review online on Ripoff Report,[4] when the customer failed to receive the order he had placed. This was carried out under an anti-disparagement clause of their site's terms and conditions.[5]
The decision by Kleargear to fine Palmer under their terms and conditions has raised ethical questions concerning whether a corporation can automatically waive a customer's free-speech rights as a condition of sale and affect a customer's credit rating such violating their terms.[6] In the face of rising backlash, the retailer has since removed the clause in question, though the clause appeared to have only first been added after John Palmer placed his order and Jen Palmer posted the negative review.[7] Kleargear closed its Facebook page and protected its Twitter account after repeated attacks.[8] The public backlash against KlearGear's actions are an example of the Streisand effect.[9]
Both the Better Business Bureau and TRUSTe have issued statements that Kleargear used their logos without permission and have begun investigations. Experian has also begun an investigation on the credit report.[10]
On November 25, 2013, Public Citizen, representing John and Jen Palmer, sent an open letter that demanded Kleargear pay the Palmers $75,000, remove the taint on their credit rating and cease and desist from using the non-disparagement clause in the future.[11][12] After Kleargear ignored a December 16, 2013 deadline to respond to the offer, Public Citizen sued the company in federal court for Fair Credit Reporting Act violations, defamation and other torts.[13][14]
References
- ^ "KlearGear.com Announces New Affiliate Program". PR Web. Retrieved 2013-11-26.
- ^ "KlearGear about us page". KlearGear.com. Retrieved 27 November 2013.
- ^ Frauenfelder, Mark (2013-11-15). "Kleargear bills woman". BoingBoing. Retrieved 2013-11-27.
- ^ "BBC News - A case for reading the small print". BBC News Magazine Monitor. 2013-11-18. Retrieved 2013-11-26.
- ^ McNally, Victoria (2013-11-19). "Company Tries to Fine Customer $3,500 for Leaving Negative Review Online". Mashable. Retrieved 2013-11-26.
- ^ Gephardt, Matt (2013-11-21). "Fined For Posting a Negative Review Online". KUTV. Retrieved 2013-11-26.
- ^ Cushing, Tim (2013-11-14). "Online Retailer Says If You Give It A Negative Review It Can Fine You $3,500". Techdirt. Retrieved 2013-11-26.
- ^ Biggs, John (2013-11-18). "KlearGear Goes Into Social Media Lockdown After It Charges Customers For Posting Bad Reviews". TechCrunch. Retrieved 2013-11-26.
- ^ Brustein, Joshua (2013-12-18). "A Company Is Sued Over Its 'No Bad Reviews' Clause". Business Week. Retrieved 2013-12-25.
- ^ Gephardt, Matt (2013-11-21). "Follow Up: Action on Behalf of Woman Fined for Penning Negative Online Review". KUTV. Retrieved 2013-11-27.
- ^ Kim, Susanna (2013-11-26). "Utah Couple Fined $3,500 by Online Merchant KlearGear Retains Lawyer, Turns Tables". ABC News. Retrieved 2013-11-28.
- ^ "Public Citizen Suing On Behalf Of Customers Whose Credit Was Ruined By KlearGear's $3,500 'Bad Review' Fee". Techdirt. 2013-11-26. Retrieved 2013-11-27.
- ^ Nelson, Steven (2013-12-18). "Retailer That Fined Couple $3,500 for Negative Review Hit With Lawsuit". U.S. News & World Report. Retrieved 2013-12-21.
- ^ "Public Citizen Sues Online Retailer That Damaged Utah Customer's Credit in Retaliation for Critical Online Review". Public Citizen. 2013-12-18. Retrieved 2013-12-25.