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Customers were deceived into subscribing to MSN Internet access

When James Odom purchased a PC from Best Buy, he assumed that he knew what he was buying. Odom was offered an Internet access "trial" CD with his computer, but refused to accept the disc on the premise that he already had his own Internet access. Despite his refusal, Odom later found that Microsoft charged him on a monthly basis for MSN Internet access.

Odom never provided his credit card information to Microsoft.

In 2002, Odom filed the suit against Best Buy and Microsoft over customer deception under the federal Racketeer Influenced and Corrupt Organizations Act (RICO). Odom alledged that Best Buy provided Microsoft his credit card information as part of a joint marketing agreement.  Thousands of similar accusations were rolled into the Odom case soon after.

The suit was dismissed initially, but a panel of judges have sent the case back to trial.

"If the customer was paying by debit or credit card the Best Buy employee would scan the trial CD. If asked why the trial CD had been scanned, the Best Buy employee would claim it was for 'inventory control' or otherwise misrepresent the purpose of scanning," stated the appeal (PDF).  The case insinuates that the Best Buy employee would then sign the customer up for MSN Internet using the credit card and trial CD without the customer consent.

The U.S. Court of Appeals for the Ninth Circuit will handle the reinstated case.

Recently, the RICO Act was put forth in a trial against four members of the New York Gambino Crime Family in which all four members were found guilty and sentenced to life in prison.

In another case, Tanya Andersen sued Atlantic Records under RICO status, alleging that members of the Recording Industry Association of America (RIAA) engaged in illegal computer trespass and extortion.

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I worked at BB during this period
By Chriz on 5/10/2007 10:49:44 AM , Rating: 6
I worked at Best Buy from 2000 to 2002 in the computer department, during most of this time they were doing the 3 year MSN rebate deal and some other MSN deals later on (like free 30 days).

The managers and supervisors/seniors put INTENSE pressure on us computer associates to make sure MSN went with every computer purchase, and basically every computer purchase that they saw that didn't have it they would talk to us about it to figure out why we weren't able to sign them up. The store as a whole, department, supervisors and managers all got special points for having MSN sign ups. There wasn't a true commission, but the Supervisors and managers definately got bonuses if their store/department signed up a large number of people.

The supervisors would even train us to tell the customer that it actually just comes with the computer (for the 30 day trial one). It was so wrong and I hated doing it. One of the reasons I don't work there anymore.




RE: I worked at BB during this period
By sepirocth on 5/10/07, Rating: -1
RE: I worked at BB during this period
By ninjit on 5/10/2007 11:41:02 AM , Rating: 5
Wow.

How are you so sure they are Hindu?? Do you mean Indian? Even then can you tell the difference between an Indian, a Pakistani, a Sri Lankan...

You ever wondered why you were a lackey at bestbuy, while that "Hindu" was your boss?

Read your own statement, it might give you a clue... No?

It's because you're an idiot, I don't mean to be condescending but idiots are the worst to work for ever.


By eppenoire on 5/10/2007 1:16:16 PM , Rating: 1
Now who is being intolerant here? Don't call a guy an idiot because he started off working for BB. I have hired a number of guys who worked for BB or Fry's. Working for these stores doesn't make them idiots, its just a way of breaking into the tech world. Plus, who is the bigger idiot, the guy who used to work for BB or the guy that has worked there long enough to become the manager?

As for Hindu issue. He may be lumping a whole a philosophical geo-social group in together, but he is not wrong. While not universal, Indian and Pakistani people are the worst to deal with. Recently I did a gig for support center, talking to management I found that most of their "escalated" calls, were from people of Indian genealogy. They had a huge call datastore, with recordings of these calls and Indians have a unique gift for bashing people over the head. I have long time friends from India and have traveled there several times myself, but I have learned to never get in an argument with anyone from India.


RE: I worked at BB during this period
By TomZ on 5/10/2007 12:06:16 PM , Rating: 1
quote:
i don't mean to be racist but Hindu people are the worst to work for ever

Wow, contradict yourself much? That is as much of a racist statement as I've ever heard.

Actually, I kind of feel sorry for you that you are that threatened by people who are different than you that you would develop such a distorted view.


RE: I worked at BB during this period
By Pops on 5/10/2007 12:46:24 PM , Rating: 2
Its not really racist. Hindu isn't a race.

Maybe he just doesn't like working for people with a red dot on their forehead. And maybe his boss was threatening to unleash the wrath of an eight armed god on him.


RE: I worked at BB during this period
By TomZ on 5/10/2007 7:06:17 PM , Rating: 1
Fine - let me restate - it was a bigoted comment, not a racist comment. Different word, same idea.


By LatinMessiah on 5/15/2007 2:16:08 PM , Rating: 2
Ouch. Now THAT'S racist!


RE: I worked at BB during this period
By Orbs on 5/10/2007 1:45:15 PM , Rating: 4
quote:
those freaking Hindu people that were the supervisors and managers in the whole store


Do you really think it was because they were Hindu? If not, what is the point in saying that? It simply promotes hate and racism. I'm sure they were awful to work for but it sounds like many Best Buy employees, from many stores who work for managers that come from many different backgrounds, all experienced similar things.

Think before you speak, don't generalize and don't promote hate. It only makes you look ignorant.


By feelingshorter on 5/10/2007 2:09:00 PM , Rating: 2
quote:
sweating bullets of fear


LMFAO!

I was the same way at my first job though.


By amolmshanbhag on 5/11/2007 12:33:00 AM , Rating: 2
My friend!!! I am not adding to the speculation. All I would say, don't make any statements about any religion or race. Hinduism has nothing to do with the managers, you are probably referring to South Asian community now that includes (Indians, Pakistanis, Bangladeshis, Sri Lankans, Nepalis) so don't start an issue. Thank YOu


By FITCamaro on 5/10/2007 2:22:21 PM , Rating: 2
I agree there was pressure as I worked there as well in college both at the registers and in computers.

But you didn't scan it without asking first if they wanted it. You certainly didn't just ring it up and say it was for inventory control. This to me sounds more like managers trying to boost their attachment numbers so their store is number one than a company wide policy.


By Pythias on 5/11/2007 11:42:57 AM , Rating: 2
Then you need to go to court and testify to that fact.


If that's the case
By audiophi1e on 5/10/2007 9:58:08 AM , Rating: 5
If this is a case of some guy going in to buy a computer with a $200 discount if you signup for AOL or MSN for 2 years--and then trying to find a way out of paying the subscription, then this is bad journalism because it makes the guy look like he was duped by the big companies.

However there is no mention of this $200 rebate deal anywhere. (including the linked articles)

The articles do have the following though:
quote:
The lawsuit, filed by Best Buy customers in California and Nevada, claims that Microsoft invested $200 million in Best Buy, which agreed to promote Microsoft's Internet service.

As part of the agreement, the suit says, Best Buy employees secretly activated free trial MSN accounts when customers paid for merchandise with their credit cards, causing customers to rack up charges when they failed to cancel the service after the trials expired.

"These allegations are more than adequate to establish, if true, that Microsoft and Best Buy had a common purpose of increasing the number of Microsoft's Internet service through fraudulent means," the court said in the ruling.


Incidentally, the lawsuit was dismissed on a technicality (by not qualifying as a RICO case), and is being reinstated on different legal grounds...so this is no longer a RICO case.

quote:
The legal issue in the appeal was whether the case against Microsoft and Best Buy, as alleged, established the companies as an "associated in fact" enterprise subject to claims under the federal Racketeer Influenced and Corrupt Organizations Act (RICO). A majority of the court ruled that the suit did meet that threshold, overturning the lower court's ruling.

A minority of the judges agreed that the case should be sent back, but they said it didn't meet the RICO standard. They cited different legal grounds instead.




RE: If that's the case
By audiophi1e on 5/10/2007 10:05:36 AM , Rating: 2
Just thought of another thing. I don't know if I can believe that BestBuy really conspired with Microsoft on this one. As much as I'd love to stick it to M$ and BestBuy, this one doesn't make sense to me.

The lawsuit alleges that BestBuy ordered its employees to secretly activate the MSN subscriptions. If you were a BestBuy employee, and you were told to activate a subscription in secret...wouldn't you feel like you were doing something wrong?? I mean, c'mon, are thousands of employees ALL going to secretly activate accounts?

This sounds far-fetched to me.

Anyway, if the lawsuit is claiming BestBuy employees were secretly activating MSN subscriptions, then why aren't they being sued too? Of course there's the obvious problem of finding everyone who activated a subscription in secret--but it doesn't avoid the fact that they did something wrong too.


RE: If that's the case
By BMFPitt on 5/10/2007 10:52:47 AM , Rating: 2
I think that this is obviously a case of customers trying to get around the requirements of a rebate. But if there was no specific consent, they screwed up. When I signed up for DirecTV to get a rebate on a TV, I had to sign like 3 forms saying I understood the terms. If Best Buy employees didn't get consent in writing for the charges, even if it is obvious that it was part of the deal, they are in the wrong here. Microsoft bears absolutely no responsibility in that case, Best Buy should have to pay for the charges.


RE: If that's the case
By Oregonian2 on 5/10/2007 1:53:56 PM , Rating: 1
Your quotes don't really seem to involve Microsoft in the "problem", their actions in creating MSN and advertising it seems legit unless they micromanaged the sales techniques used by Best Buy.

Off hand it looks like Best Buy should be shot. If the fellow accepted the rebate then he should be shot too. Accepting payoffs or money for transactions usually will signify acceptance of terms associated with that money. So if he did accept the rebate money then I think he's in a real weak position personally even if Best Buy should still be shot for their (alleged) techniques.


RE: If that's the case
By deeceefar2 on 5/10/2007 3:03:09 PM , Rating: 3
This is still a RICO case. The majority of the appeals court ruled that it did meet the burden of RICO and as such should go to trial. I also agree if this is a case of someone receiving a rebate but not liking the terms that both the court case and the coverage of it grossly misconstrue the facts of the case. It will be interesting to see how this case ends.

Having read the opinion of the appeals court it appears, that if the allegations can be proved, that in fact this would fall under RICO. The contract between Best Buy and Microsoft lead to multiple instances of them acting as an "associated in fact" enterprise and committing wire fraud. There were 2 alleged steps: first Best Buy scanned the MSN trial CD and transmitted the information with the customers billing information to Microsoft, misrepresenting it as a form of "inventory control," even though the customer said they didn't need it; then Microsoft proceeded to bill the customer for the internet service even though they never used it and disputed signing up for it. If proved those 2 separate commissions of wire fraud by the companies would indeed count as a continuing enterprise under RICO. It is more then just a marketing contract as the original judge alleged, because it involved multiple acts in coalition with one another, aimed to defraud the customer.

Though it may seem odd, the Supreme Court ruled that RICO is more far reaching then most would believe, and that if it were not the intention of congress for it to be so far reaching, that they would have to be the ones to fix it. That being said the Plaintiffs will still have an uphill battle. In this case Microsoft would have just been better making the charge go away, then pursuing payment on a service that was never used, and apparently they had no proof the customer ever signed up for. From reading the opinion of the appeals court, I think **AA's better be very careful how they tread, because one wrong step and I could easily see them in a similar law suit. A RICO judgment against the **AA's would be a huge blow.


RE: If that's the case
By Oregonian2 on 5/10/2007 6:23:53 PM , Rating: 1
Didn't Best Buy sign them up? Doesn't that make it reasonable that MSN software should do the billing? If the customer had said "yes!" would the sign up procedure been any different than Best Buy's CD scan, and wouldn't the results be the same?

If some sort of rebate or price reduction was accepted by the customer, that itself would constitute acceptance of the deal. At least from previous court cases that I recall hearing about.


Best Buy sucks
By darkpaw on 5/10/2007 8:56:11 AM , Rating: 3
Best Buy really has some of the sleeziest business practices. Somehow I'm not surprised they'd do something like this too.




RE: Best Buy sucks
By OrSin on 5/10/2007 9:09:47 AM , Rating: 3
The so called clueless costumer was get a $150-300 rebate on the computer for signing up. I'm sure he took the rebate. That why the case was thrown out to begin with.
If you take the money then you should understand why they was giving it to you.

Bestbuy and staple employees was clueless in most store around that time ( some still are). Thye have no idea what they selling. They do the same steps for all prodcuts becuase they jsut dont know other wise. Its a sham, but thye just dont get the training needed for most departments.


RE: Best Buy sucks
By therealnickdanger on 5/10/2007 9:10:37 AM , Rating: 5
Some customers are capable of some sleezy things too. If my memory serves, these "trial" CDs were not trials at all, but MANDATORY in order to pocket a $300 rebate when you bought an entire system. AOL unleashed a similar tactic back then as well. Basically, you walked out of the store with a paying under $200 for a complete computer system with the requirement that you pay for AOL or MSN Internet services for a period of 2+ years or something like that. Lots of customers attempted to get the rebate without paying for the service.

I'm not defending Best Buy or CompUSA or Circuit City or any of these places that may have actively lied to their customers or simply didn't properly train their employees, but if you have ever worked retail, especially in a rebate-friendly environment, you know that those customers can be real buttholes and will do anything to save $3 on a pack or CD-Rs.


RE: Best Buy sucks
By enlil242 on 5/10/2007 11:38:59 AM , Rating: 2
This kinda reminds me of the "deal" I got on a 42" Panasonic Plasma TV I got right after "Black Friday."

They were selling the TVs for $1199 after isntant rebate, plus I could take an additional $200 off if I use their "free" installation services. I am not sure of all the details anymore, but essentially I got the TV for $999. But the bill showed $799 for the TV and $200 for the installation.

Well, That didn't really bother me too much until I was on my fourth replacment set as they kept sending me TVs with stuck pixels. I finally inquired about just getting a refund when they said that the "installation service" was non-refundable! (I never even called them to come out and install the TV, which basically consisted of hooking up my components).

Anyway, My fourth set was fine and I didn't have to go down the dark path. But now I am not bothered in the slightest that I regulary take advantage of their 30 return policy... But that really displays what lengths they go through to make a sale.


monkey boy pix...
By codeThug on 5/10/2007 1:26:53 PM , Rating: 2
Where do you guys at DT get these hilarious Ballmer pix?




RE: monkey boy pix...
By Ralph The Magician on 5/10/2007 4:06:02 PM , Rating: 2
Seriously, that's what I want to know. They should release a zip file with all their Ballmer pics, both originals and icon size. They are fantastic. Someone at DT has a Steve Ballmer fetish or something.


RE: monkey boy pix...
By KristopherKubicki (blog) on 5/11/2007 6:32:51 AM , Rating: 6
RE: monkey boy pix...
By Pythias on 5/11/2007 11:49:20 AM , Rating: 2
Whoa, Single White Female time. Seek help.


Tangentially DirecTV
By paydirt on 5/10/2007 10:48:42 AM , Rating: 2
If you buy a DirecTV satellite receiver from Best Buy, etc. You are in fact leasing the receiver for 2 years and if you terminate with DirecTV early, they charge you $12 per receiver per month. I never signed or agreed to lease the receivers from Best Buy or DirecTV. Apparently it is in the agreement that DirecTV sent me in the mail after I signed up with the operator.




RE: Tangentially DirecTV
By darkpaw on 5/10/2007 11:10:22 AM , Rating: 2
Best Buys DirecTV BS is what really pissed me off about them too. I didn't have this happen, but I bought a four room system from them some years back and they were providing installing. They contracted out the installation to yet another party and the job was done half assed. The installer used the wrong parts and wrong splitter box. They also had the nerve to send a bill for that splitter box even though it didn't even last a month (they used an indoor only amp box on an exterior location in Phoenix during the summer). BestBuy wouldn't do anything about it either, even though it was their contractor and their sale.

I ended up having to pay DirecTV another $75 directly to come out on a service call and fix the installation.


RE: Tangentially DirecTV
By Mitch101 on 5/10/2007 11:29:34 AM , Rating: 2
All installs of DirectTv that I know of are contracted to third party. Its the third party that is crooked. Buddy of mine went through something similar and they were supposed to run a line to both his drops. He confirmed with DirectTv ahead of time this would be included with the free install. However when the guys showed up they tried to charge an additional $75.00-$100.00 per drop because there was already a single line run by the cable company for cable. He said to them if he had cable on those lines they would have to run the lines for DirectTv receivers any way. They shouldnt be able to claim the cable tv runs can be considered the free install of DirectTV just because he wasnt using them for cable. They claimed they could use the lines already run and any additional lines would cost him. The free is the lines from the dish to the point where they could tap into the cable lines.

He paid it and contacted DirectTv to re-imburse him for installing the additional lines. DirectTv did re-imburse him. The bill was a little over $200.00.


RE: Tangentially DirecTV
By darkpaw on 5/10/2007 11:38:55 AM , Rating: 2
That was similar to what DirecTV told me. They told me that if I had ordered the service right from them that they would have taken care of it and refunded my money. Since I had ordered it through BestBuy it was their responsibility, but BestBuy wouldn't even talk to me about the issue.

The DirecTV rep was actually very helpful in getting something resolved and they only charged me for the service call and replaced the amp and the dish for free.


Similar Practice
By Dharl on 5/10/2007 11:13:38 AM , Rating: 2
I agree with Chriz. BestBuy appears to push these extra promotional products or services on their customers. Regardless of if employees wish to do it or not. If they didn't they'd just replace you with someone willing to do so.

About a year ago BestBuy in my area did something similar with two magazines. For the span of two months everytime I went into BestBuy I would be asked if I'd like a "Promotional deal to get a free subscription to Entertainment Weekly or Sports Illustrated." The worst part about it was is that some employees never asked you if you wanted it. They would try and scan it then tell you "You're getting a free subscription to these magazines. I need your name and address."

By about the 10th time I was so fed up with the badgering I told the employee yes. She quickly scanned the promotional brochure and took my name and address. Done deal. One month later I receive the magazines with a tiny piece of paper. Reading the tiny piece of paper revealed that after the first month's issue you would be charaged full price for the magazines for a year's subscription. That is unless you called a certain number or went to their website to unsubscribe. Their phone service was next to none. The website was misleading to say the least. At least I was able to unsubscribed, but I wonder how many people never caught on or didn't bother to try and unsubscribe.

I really hate this kind of business practice.




RE: Similar Practice
By givionte on 5/10/2007 12:04:44 PM , Rating: 2
If they would have attempted to force me into buying that magazine, I would have spoken to a manager, or even better, filled out the survey that prints on your receipt. Any comments you write on the online survey and sent to corporate and the stores, and typically read aloud in team meetings. Best way to get your concerns addressed is to speak up.


RE: Similar Practice
By BMFPitt on 5/10/2007 1:01:12 PM , Rating: 2
I've always dealt with the magazine pitch in a two step process. I respond with "Don't ever ask me a stupid question like that again." If they continue to insist (or if it's someone who previously has) I ask them if they would like me to cancel my purchase and inform their manager they made some racist comment. That usually moves my sale right along.


wrong again DT
By johnsonx on 5/10/2007 10:15:50 AM , Rating: 3
quote:
The suit was dismissed initially, but a panel of minority judges have sent the case back to trial.


No, that's not what the article says. That sentence makes it sound as if the judges themselves were minorities! Even leaving aside the awkward wording, the sentence implies almost the opposite of what the linked article says.

The Majority opinion of the Ninth Circuit Court was that the case should proceed as a RICO case. The Minority opinion dissented slightly, saying that the case should proceed, but citing different legal reasoning instead of RICO. So both opinions were to send the case back to trial; the majority opinion prevails, so it can proceed as a RICO case (though at this point, since the minority opinion expressed other legal grounds for proceeding as well, the plaintiffs could probably proceed using either or both theories if they're compatible).




RE: wrong again DT
By audiophi1e on 5/10/2007 10:57:24 AM , Rating: 2
ooh, yeah you're right.

I take it back. It says as a RICO case.
Man, didn't have my morning coffee yet.


Cellular
By aftlizard01 on 5/10/2007 1:24:34 PM , Rating: 2
What makes this so different than what a cell company does? Was there no contractual obligations that the customers signed?




RE: Cellular
By deeceefar2 on 5/10/2007 3:09:53 PM , Rating: 2
There is no mention anywhere of any sort of contract to use MSN service. The customer appears to have been signed up by the Best Buy employee when the CD was scanned even though they said they didn't want it. If there is more information, it will come out at trial I assume.


It is clearly Best buys wrong doing!
By HrilL on 5/10/2007 7:06:01 PM , Rating: 3
Even if he accepted the rebate he would have had to been told in writing that after the free 30 day trial he would be billed tell he canceled. I would bet that writing came with the trial cd. If he said he didn't want it and they scanned it I doubt they gave him the cd because he didn't want it... So He was clearly never told that he would be billed after his trial. So even if they gave him the $200 rebate they would have had to give him the terms in writing. At this point I don't know if either side can prove they did or didn't give or get it.

When I was a TSR we had to tell the people they would be billed after the trial was over. And we also mailed the terms to them so there would be no way to say they didn't know. And all calls were recored as well. They don't recored what you say to the guy ringing you up... So even if he was told. They can't prove he was. He said No he didn't want the trial and if you had to take the trial to get the rebate it would be best buys job to then tell him that those were the conditions of the rebate. If they didn't tell him and he didn't take the CD that probably came with the terms in writing then he is in the right and that is why it is going to trial.




no credt cards...
By Chernobyl68 on 5/10/2007 1:18:10 PM , Rating: 2
makes me want to not use credit cards anymore.
Think I'll start using checks next time I'm there...or better yet, cash.




sadly...
By pillagenburn on 5/10/2007 4:03:37 PM , Rating: 2
This is how a goodly number of companies, these days, stay in business and continue to satisfy their shareholders. By engaging in unethical (and sometimes illegal) practices, they can make that extra couple bucks on each sale and pump those earnings. This is very true in the banking/insurance industry. There are entire teams of people devoted to figuring out new ways to fee their customers and keeping it under the radar.

I know that in my particular industry (a small business), we can get in trouble/fined for trying to charge even a small fee to customers. This is very hypocritical, but I guess that's what you get when you don't have a lobby group working for you in Washington D.C.




Someone should go to jail
By viperpa on 5/10/2007 11:34:45 PM , Rating: 2
If I purchase something from a store, whether I use a cc or cash, I expect them to be honest about it. What Best Buy did was dishonest, unethical, and fraudulent. Any normal person would go to jail for doing what Best Buy did, using a person's cc without there permission. I don't care if it was a marketing deal. If the customer did not give permission, then Best Buy is in the wrong.




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