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I participated in the arbitration swarm against IndieGoGo for tortious interference after they shut down and refunded a campaign after it had completed successf

I participated in the arbitration swarm against IndieGoGo for tortious interference after they shut down and refunded a campaign after it had completed successfully. The details of the matter aren't public but the mechanics are. In order to participate, consumers pay a one-time fee capped at $250 and they pick up the rest. "The rest" includes the balance of the arbitration fees ($1500). Companies used to ignore this and leave people in arbitration limbo but California changed their laws a couple years back and if the company fails to pay, it automatically goes into arbitration and they have to pay after. More importantly, $1500 each isn't the big cost. The more expensive part is they have to individually respond and work them through the process. If you have 100 or 1000, the billable hours - or even just corp legal team's hours - start racking up quickly and it ties up and slows down all other matters. And none of this considers the consequences of the arbitrations. Win or lose the first few, people can iterate and shift the outcome over time. So yes, it becomes a legal DDOS.. and Amazon dealing with 75k of them is a staggering number and still only a fraction of what they could have faced.

mtmail 5y ago
In Germany banks have to reimburse some fees after a court decision. But each customer has to write their own letter, the banks offer no forms or real help because it's not in their best interest. Still Deutsche Bank put aside 350 million Euro, only 100 of those is for fees, the rest I assume is the extra administrative hassle.
mumblemumble 5y ago
Just pulling some numbers out of a hat, if they are paying $250/hr for legal counsel, and each of these disputes is generating one 8-hour day's worth of billable time, then Amazon is looking at $1.5 billion in legal fees to individually arbitrate each of these disputes.
- xyzzyz 5y ago
  I hardly think they are paying $250/hr for external counsel on each and every of those 75 000 arbitration cases. Amazon can easily justify hiring in-house counsel, and regular employees of legal department don't make $500k/year. More likely, they are going to hire a bunch of paralegals at $40/hour, and have each spend 1 hour tops on arguing each case.
wpietri 5y ago
Is there any more information available on which campaign was shut down or why they did it? Perhaps pre-settlement discussions on organizing the swarm? I'm really curious as to the backstory.

mtmail 5y ago

In Germany banks have to reimburse some fees after a court decision. But each customer has to write their own letter, the banks offer no forms or real help because it's not in their best interest. Still Deutsche Bank put aside 350 million Euro, only 100 of those is for fees, the rest I assume is the extra administrative hassle.

mumblemumble 5y ago

Just pulling some numbers out of a hat, if they are paying $250/hr for legal counsel, and each of these disputes is generating one 8-hour day's worth of billable time, then Amazon is looking at $1.5 billion in legal fees to individually arbitrate each of these disputes.

xyzzyz 5y ago
I hardly think they are paying $250/hr for external counsel on each and every of those 75 000 arbitration cases. Amazon can easily justify hiring in-house counsel, and regular employees of legal department don't make $500k/year. More likely, they are going to hire a bunch of paralegals at $40/hour, and have each spend 1 hour tops on arguing each case.

wpietri 5y ago

Is there any more information available on which campaign was shut down or why they did it? Perhaps pre-settlement discussions on organizing the swarm? I'm really curious as to the backstory.