Home » Uncategorized » “Cheerios: Now With 30% More Legal Waivers!”

“Cheerios: Now With 30% More Legal Waivers!”

I’ve come to expect that my cell phone contract, credit card agreements, and many other contracts with businesses will include language mandating that any disputes will be resolved through binding arbitration, rather than through litigation. It’s a terribly one-sided state of affairs, as I’ve got no leverage to bargain to retain my right to sue, or to take my business to providers who won’t impose such restrictive terms. And I’m not going to give up my cell phone and credit cards in protest. So why does this account in Thursday’s New York Times surprise as well as appall me?

General Mills, the maker of cereals like Cheerios and Chex as well as brands like Bisquick and Betty Crocker, has quietly added language to its website to alert consumers that they give up their right to sue the company if they download coupons, “join” it in online communities like Facebook, enter a company-sponsored sweepstakes or contest or interact with it in a variety of other ways.

Instead, anyone who has received anything that could be construed as a benefit and who then has a dispute with the company over its products will have to use informal negotiation via email or go through arbitration to seek relief, according to the new terms posted on its site.

In language added on Tuesday after The New York Times contacted it about the changes, General Mills seemed to go even further, suggesting that buying its products would bind consumers to those terms.

So if I buy a box of Cheerios and find a “secret ingredient” in the box that causes me harm, I have no meaningful way to hold General Mills accountable? (Maybe this scenario is the one GM thinks it’s preventing?) An industry can give itself blanket immunity to civil suit just because it says so? Sure, I can arbitrate, but if damages are likely to be small, arbitration won’t be worth the time and cost, especially since the Supreme Court has also upheld the right of corporations to include contract language banning class-action arbitration. Any damages award I receive will be kept secret, and as such will offer no aid to similarly situated individuals seeking remedy. And in arbitration, I’ll be playing in a game in which the other team has chosen the referee. General Mills does claim to cover the cost of arbitration in most cases, but that’s not much consolation: “I’ve chosen the ref, but don’t worry–I’ve paid for him too!” I harbor no illusions that the courtroom places consumers and corporations on an even playing field, but I do know that if civil trials didn’t give ordinary people better odds of a fair shake, corporations wouldn’t work so hard to deny consumers access to the courtroom.

The larger question, as I see it, is whether business interests can advance a legal claim so audacious that even the Roberts Court, whose majority all but wears the U.S. Chamber of Commerce logo on its robes NASCAR-style), would feel compelled to reject it. My sense is that we’ll have to wait for a Scalia or Kennedy retirement to find out, as actors looking to challenge these arbitration provisions are not going to risk almost certain defeat in front of the current Court.


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