Last week a class action was filed against AOL alleging that AOL improperly inserted advertising into the email messages sent by AOL subscribers.

Access a copy of the complaint (which was filed in the Central District of California (Los Angeles) here: [pdf]).

The crux of the lawsuit is that AOL improperly started inserting advertising into subscriber emails. As an example, the complaint points to examples of text ads that were inserted (or placed at the end of) subscriber emails:
Find phone numbers fast with the NEW AOL Yellow Pages.
New MapQuest Local shows what’s happening at your destination.
I guess AOL didn’t always do this, and started around 2006.

At first glance the lawsuit seems flimsy. Do people really care that their emails (sent through AOL) contained these text advertisements? I guess it probably depends on the person in question, and maybe this presents one reason why the suit cannot be adjudicated as a class. But as you think about it on a conceptual level, it doesn’t necessarily seem so far-fetched. Let me put it this way, there’s no way I would find in favor of the plaintiffs if I was judge or jury. But that doesn’t mean the complaint won’t survive a motion to dismiss, spur some discovery, and ultimately settle.

The actual causes of action are those you would find in a typical consumer class action. Fraud, unjust enrichment, breach of implied covenant of good faith, 17200 (unfair competition), 17500, and 1750. Many of these are throwaway claims, and will probably not survive a motion to dismiss. For example, it will be tough for plaintiffs to prove that AOL was unjustly enriched as a result of selling ads in emails since plaintiffs are unlikely to be able to show that AOL appropriated anything of value from them. The plaintiffs do not typically place ads in emails and would not have taken advantage of this real estate – that’s what plaintiffs are complaining about here.

The fraud claim is interesting. It’s not pled with particularity. It also unfortunately alleges that plaintiffs “relied on the AOL Terms of Service.” AOL will probably use this to argue that the Terms of Service should be enforced as written, since plaintiffs through their own allegations relied on them (and read them). (Unconscionability of terms of service is typically contested in these cases, but may not be as easy to do here.) The Terms of Service typically contain many onerous dispute resolution provisions (limitations on class resolution, limitations on liability, venue, forum, etc.).The AOL Terms of Service I came across (which may not be the operative terms) were not as onerous as these types of terms typically are, but they do contain a forum selection clause.

I think the fact that the plaintiffs are complaining about AOL-provided email makes this lawsuit a particularly tough sell. Does anyone even use AOL for email anymore?

Posted by Venkat at 10/24/2008 7:01 PM
Categories: Consumer

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11/24/2008 4:57 AM The Florida Masochist wrote:
You wrote- Does anyone even use AOL for email anymore?

I do.
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