

Utah Couple Fined $3,500 by Online Merchant KlearGear for posting bad review - velodrome
http://abcnews.go.com/Business/couple-fined-3500-writing-negative-review/story?id=21018224

======
tokenadult
"a public service lawyer has agreed to take the case and fight back with
demands for $75,000 in compensation."

. . .

"Michelman said the $75,000 compensation amount is in the high range of a
typical award for acts in violation of the Fair Credit Reporting Act."

This is an old story now, already discussed extensively here on Hacker News.
The new information here is simply that the couple has a lawyer, who can
afford to represent them on speculation because of a federal law that allows
recovering damages from a company that tries what KlearGear is alleged to have
tried in this case. We'll know the final outcome after the litigation
proceeds, but I predict a good result for the Utah couple.

The previous discussion eleven days ago

[https://news.ycombinator.com/item?id=6742410](https://news.ycombinator.com/item?id=6742410)

went back and forth over most of the issues raised by this story. Bottom line:
the couple has to follow certain procedures to respond to a credit agency
report about their behavior, and the credit agency report about their personal
credit history seems to have other adverse information (reported in one of the
sources discussed in the earlier thread). All's well that ends well, and I
expect this case to end well for the couple and badly for KlearGear.

------
powertower
What I don't get is that the husband went to the website and made the order,
but it was the wife that made the review when the order (a gift for her) never
showed up... So she and the company have no TOS agreement (there is no
contract between them). But this is not even mentioned or used in the lawsuit?

> Michelman also said that the "non-disparagement" clause was not even on the
> website when John Palmer placed his order in 2008.

So why not get them for fraud and some other federal charges too?

------
CaptainZapp
The inimitable Ken White has a number of interesting essays on the case :

[http://www.popehat.com/2013/11/15/new-from-kleargear-free-
sp...](http://www.popehat.com/2013/11/15/new-from-kleargear-free-speech-
only-3500-plus-shipping-and-handling/)

and

[http://www.popehat.com/2013/11/25/kleargear-reaps-the-
whirlw...](http://www.popehat.com/2013/11/25/kleargear-reaps-the-whirlwind/)

------
wf
This is a really stupid mistake for a company to make, the outcry is way worse
than one bad review. Googling "KlearGear" now brings up a ton of bad press. I
guess it's relatively easy for a company like this to change their name and do
the same things though?

~~~
giarc
Agreed. Someone running the company was not smart enough to realize that the
likelihood of them collecting the $3500 was low, and when the couple first hit
the press with the "fine" they should have backed off and claimed it was some
mistake. I don't know what blinds people from what seems like common sense.

------
IanDrake
I had a similar problem once. Cleared it up by writing a letter with the
entire situation, the letter started with:

    
    
        To: My State's Attorney General
            Address....
    
        CC: Company affecting my credit
            Address...
    
        CC: Collection company
            Address...
    
    

Then made three copies and sent the letter's out. AG's office sent me a case
number after just two weeks. The Company reporting the bad debt within two
months, denying any wrong doing while immediately "fixing" the
"misunderstanding". It was an interesting learning experience.

For 75K, perhaps I should have gotten a lawyer.

------
misnome
Been following this through Popehat, latest:
[http://www.popehat.com/2013/11/25/kleargear-reaps-the-
whirlw...](http://www.popehat.com/2013/11/25/kleargear-reaps-the-whirlwind/)

It gets worse, it looks like the "non-disparagement" clause wasn't even in T&C
at the time they bought their item.

------
chollida1
> After an online merchant fined a Utah couple $3,500 for writing a negative
> review

How can a company fine a private citizen? Isn't fining something only a
government can do?

~~~
lutusp
Strictly speaking, a company can _charge_ an individual for breaking terms of
a contract, but not _fine_. The word "fine" is normally reserved for entities
with policing powers, although, language being what it is, you may see usage
exceptions.

[http://legal-dictionary.thefreedictionary.com/Fines](http://legal-
dictionary.thefreedictionary.com/Fines)

Quote: "Monetary charges imposed upon individuals who have been convicted of a
crime or a lesser offense."

------
Aardwolf
The shocking news to me is that in the US, a random company A can cause you to
not be able to obtain heating from another company B, due to the existence of
"credit reporting agencies". (Disclaimer: I'm not from the US)

~~~
sokoloff
A good predictor of whether you'll repay a new debt is your track record of
paying back prior debts. Credit reporting agencies act as a clearinghouse of
information on your past and current debt repayment track record. All of that
is pretty helpful to a smoothly functioning (and well-priced) lending/credit
market.

The only thing that's gone wrong here is a merchant is (to my very lightly
informed opinion) abusing that system in a way contrary to the original
intent. That will almost surely get cleaned up in due time.

~~~
rayiner
The credit reporting system has long since gone beyond its original purpose
and turned into a corporate tool of abuse. People are getting denied for jobs
for their credit history.

------
bloat
Is it true that any random company I once did business with can call up a
credit ratings agency and claim that I owe them money?

What standards of proof do the credit agencies require?

~~~
tehwebguy
This was pretty surprising to me - it would be one thing if it were sent to a
shady collections agency but it seems like the credit reporting agencies
wouldn't be able to accept something like this.

This is a unilateral "fine", it's not an actual credit line that was taken
out. Very strange, my guess would be that this company is breaking the rules
for reporting actual credit issues.

~~~
chilldream
There's only so much oversight such a bureau can have, especially if a company
is willing to lie to them. According to Popehat, they've also done things like
falsely list positive BBB ratings on their website, so it's not hard to
imagine them coming up with some way to pretend the charge is legitimate.

~~~
carsonreinke
[http://www.bbb.org/western-michigan/business-
reviews/novelti...](http://www.bbb.org/western-michigan/business-
reviews/novelties-retail/kleargear-in-grandville-mi-38143064#)

They have alert on their site.

------
rdl
Sad about two things. This didn't happen to me, so I don't have the standing
to collect >$75k from this company for blatant FCPA and consumer law
violations. And that no one has dropped dox on the principals of KlearGear.

