GM Abandons Controversial Online Legal Policy Amid Growing Backlash

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General Mills Inc. has recently reversed its controversial new online legal policy that had required certain consumers to agree to forego their rights to filing lawsuits against the company if they communicated with GM via its social media sites or had certain other online interactions with the company. Instead, GM’s new policy was requiring these consumers to agree to mandatory arbitration to settle their grievances against the company, sparking considerable backlash against GM.

The specific portion of GM’s now abandoned legal policy that was the target for so much criticism was the following:

In exchange for the benefits, discounts, content, features, services, or other offerings that you receive or have access to by using our websites, joining our sites as a member, joining our online community, subscribing to our email newsletters, downloading or printing a digital coupon, entering a sweepstakes or contest, redeeming a promotional offer, or otherwise participating in any other General Mills offering, you are agreeing to these terms.

It was specifically the reference to “online community” that quickly triggered an uproar among consumers, as well as the legal community. As many critics to GM’s policy update pointed out, the wording of the policy was so general that it could be extended to apply to any person who simply “Liked” the company on Facebook, signed up for email alerts from GM, printed coupons from the manufacturer’s website and/or engaged with the company in a seemingly minor way through a wide-range of online forums and outlets.

As Julia Duncan, the director of federal programs at the American Association for Justice, has pointed out, “it is very clear that if you do any number of things, you are covered by these changes … [GM’s new legal policy] is so exceptionally broad that it may be possible anything you purchase from them would be held to this clause.” A number of consumers took to their own social media accounts to echo these concerns, with some expressing that they have stopped “liking” GM on Facebook while others expressed that they would be boycotting GM products altogether.

GM Backpedals, Then Reverses its Online Legal Policy

In response to the growing backlash GM was facing over its online legal policy, the company’s initial response was to defend itself and, to an extent, claim that people had largely overreacted to it. In fact, as GM spokesperson Mike Siemienas had stated, “the policy would not and does not preclude a consumer from pursing a claim. It merely determines a forum for pursuing a claim. And arbitration is a straightforward and efficient way to resolve such disputes.”

This explanation did nothing to quell the backlash, however, and on April 19, 2014, GM announced via its blog that it was abandoning its online policy. As Kirstie Foster, the director of external communications for General Mills explained, “those terms – and our intentions – were widely misread, causing concern among consumers… so we’ve listened – and we’re changing [the terms] back to what they were before.”

This controversy is sure to be a learning experience not only for GM but for other major manufacturers in the U.S., as consumers’ public shaming of the company for its move to try to limit consumers’ rights to file direct lawsuits forced a reversal of the controversial legal policy.

 

Topics:  General Mills, Waivers, Websites

Published In: Alternative Dispute Resolution (ADR) Updates, General Business Updates, Communications & Media Updates, Consumer Protection Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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