Sony updates PSNs Terms of Service to ask you to waive a few rights

Sit down, everyone, we’re about to get legal. Remember when the PlayStation Network was down for a month because a group of well-organized hackers cracked its servers open like an oyster and gobbled up all of personal data from millions of PSN users? We do. We also remember that when it happened there was talk of lawsuits, the kind that come when a company doesn’t do its job of protecting names, addresses, passwords, and credit card numbers of its customers.

Sony remembers this too, and though it’s promising to take leaps forward when it comes to protecting its customers’ personal information, it is making sure to look out for number one by updating its privacy policies and terms of service to make it harder for you to sue if it ever drops the ball again.

In an email sent out to all PlayStation Network users, Sony has outlined the updates to its legal documents. It specifically suggests that users should “review Section 15 of the TOS, which now includes a class action waiver and requires that most disputes be resolved through arbitration.”

Opening up the Terms of Service document shows a lot of red text and a lot of legal mumbo-jumbo, but here’s the interesting part:

“Class Action Waiver. ANY DISPUTE RESOLUTION PROCEEDINGS, WHETHER IN ARBITRATION OR COURT, WILL BE CONDUCTED ONLY ON AN INDIVIDUAL BASIS AND NOT IN A CLASS OR REPRESENTATIVE ACTION OR AS A NAMED OR UNNAMED MEMBER IN A CLASS, CONSOLIDATED, REPRESENTATIVE OR PRIVATE ATTORNEY GENERAL ACTION, UNLESS BOTH YOU AND THE SONY ENTITY WITH WHICH YOU HAVE A DISPUTE SPECIFICALLY AGREE TO DO SO IN WRITING FOLLOWING INITIATION OF THE ARBITRATION. THIS PROVISION DOES NOT PRECLUDE YOUR PARTICIPATION AS A MEMBER IN A CLASS ACTION FILED ON OR BEFORE AUGUST 20, 2011.”

It appears that by agreeing to the terms of service by updating your PlayStation 3 and accepting the thing you’re not going to read, you’re waiving your rights to enter a Class Action Lawsuit against Sony. In other words, you sue Sony all you want, but you can’t join with a bunch of other people to sue Sony. If you’re going toe-to-toe with Sony in court you’re going to need to do it solo. It’s possible to opt-out of this clause, but that requires a written letter sent to Sony’s offices, and it has to be done within the next 30 days. Still with us? Good. By the time you’ve finished reading this you’ll be one step closer to passing the BAR exam.

We asked attorney Joseph T. Forkin for his opinion (which is not meant to be offered as legal advice), and he said that “In most ‘terms of service’ many companies will try to get the consumer to sign away as many/all of their rights as is favorable to themselves.” He also said that the fact that it’s free makes it “reasonable,” at least legally. “As long as you know about the clause before you pay or play for free, it’s going to be reasonable.”

There’s another option: cancel your PlayStation Network account without accepting these terms. If you do that, you’re allowed to enter a Class Action Lawsuit against Sony in the future. Odds are none of you are going to do that, but it’s still good to know your options.

Unless you are, in which case we’d love to hear about it in the comments section below. Anyone angry enough to quit the PlayStation Network forever?

Sep 15, 2011