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The Consumerist

Leaked Contract: Amazon Makes Warehouse Workers Sign 18-Month Non-Compete Agreements

Thu, 2015-03-26 19:55

This is only what giant Amazon robots look like in my imagination. (chinguri


Amazon warehouses, even the ones powered by amazing shelf robots, depend mostly on human labor to get the stuff off the shelves and into boxes. The job doesn’t pay very much and is grueling, and also has high turnover. Oh, and employees are asked to sign 18-month non-compete contracts that ban them from working for any competitor of Amazon.

We thought that the non-compete contract that Jimmy John’s made its employees sign was bad, and that only limited ex-workers from working in any place that makes more than 10% of its money from selling “submarine, hero-type, deli-style, pita and/or wrapped or rolled sandwiches.” Yet The Verge got hold of a seasonal worker’s contract and made it public, and it has a surprising requirement. Amazon bars their former employees from working for companies with products or services that compete with Amazon’s. Some workers have reported signing a similar agreement after a layoff in order to receive their severance pay. Amazon is a store that sells pretty much everything, so how does that work out for employees in their warehouses?

One woman who works at one of Amazon’s warehouses during the holiday season takes the agreement seriously, saying that she would ask permission before seeking a job with a retailer like Walmart or Sam’s Club. Is she being overly scrupulous? She hasn’t tested how strict Amazon is about the policy, since she hasn’t yet been offered a job with one of their competitors.

The Verge notes that they asked Amazon which jobs at which companies their former warehouse workers might not be allowed to take under the non-compete agreement. Amazon hadn’t responded as of earlier today.

During employment and for 18 months after the Separation Date, Employee will not, directly or indirectly, whether on Employee’s own behalf or on behalf of any other entity (for example, as an employee, agent, partner, or consultant), engage in or support the development, manufacture, marketing, or sale of any product or service that competes or is intended to compete with any product or service sold, offered, or otherwise provided by Amazon (or intended to be sold, offered, or otherwise provided by Amazon in the future) that Employee worked on or supported, or about which Employee obtained or received Confidential Information.

Non-compete clauses make sense for employees who have sensitive knowledge about the back-end operations of Amazon. We can even see how competitors might want to recruit the people who design and run Amazon’s warehouses. Amazon warehouses are often in remote areas without many employment options, which makes non-compete agreements for jobs that pay maybe $12 per hour an even worse idea.

Exclusive: Amazon makes even temporary warehouse workers sign 18-month non-competes [The Verge]

Obedience School Sues Yelper For $65K Over Negative Review

Thu, 2015-03-26 19:01


Note: Not the actual dog involved in this lawsuit. (photo: colonelchi)

A few months ago, a Virginia woman began taking her dog to obedience class, and when the training wasn’t what she expected, she requested a pro-rated refund and wrote a negative review of the school on Yelp. Now she’s facing a $65,000 defamation lawsuit.

The Washington Post reports on this lawsuit, the latest in a string of legal actions filed by businesses against customers who vent on Yelp and other online review platforms.

In this case, the customer says she was expecting that the $175 training program would help her socialize her puppy so that it possibly be used as a therapy dog. However, she claims that the conditions of the school were not conducive to this goal so she requested a partial refund.

“In a nutshell, the services delivered were not as advertised and the owner refused a refund,” she wrote in her Yelp review, which has since been removed from the site.

But in the lawsuit, the school’s owner claims that she communicated the training conditions with the customer in e-mails before classes even started. She also says that the customer agreed to a no-refund clause.

She tells the Post that she offered other non-refund options to the customer, like a credit for a future class, but to no avail.

The owner explains that, as a small business, the school depends on word-of-mouth from online review sites to reach new customers and that this customer’s negative review “had a significant impact.”

The customer contends that the lawsuit and others like it are an attempt to stifle consumers’ First Amendment protections.

“People should be free to express their feelings about their service providers,” she tells the Post. “Companies using the legal system to silence their critics has a chilling effect on First Amendment rights.”

The customer contends that the school’s lawsuit is what’s known as a SLAPP complaint — a “strategic lawsuits against public participation,” wherein the plaintiff sues with the intent of quieting a defendant who can’t afford to fight back in court. Several states have anti-SLAPP statutes that allow for a judge to review the merits of a complaint and quickly dismiss any frivolous allegations that are only intended to stifle free speech.

The obedience school lawsuit is just one of several recent complaints filed by businesses against Yelp reviewers.

Because bad reviews can hurt business as long as they’re still available online, many plaintiff companies will seek a preliminary injunction asking to have the review taken down immediately pending the outcome of the case.

That was the issue with a few years back when a contractor — also in Virginia — sued a customer over allegedly libelous remarks made in her Yelp review, and asked the court to have the review taken down in advance of the trial. Initially, the judge tried to compel the defendant to edit a portion of the review, but she appealed as the edits in question presuppose that what she wrote was defamatory without the case ever going to trial.

That would be a violation of the rule against prior restraints, she argued, and in 2013 the Virginia Supreme Court agreed.

What sets both of the above cases apart from most Yelp-related lawsuits is that there was no question of who wrote the reviews involved.

Many lawsuits filed by businesses against Yelp reviewers done with temporary “John Doe” defendants because the businesses only have the Yelp user names to go on, and Yelp is understandably reluctant to hand over information about users.

Staying in Virginia, there has been an ongoing battle between Yelp and a carpet cleaner trying to force the site to reveal the names of certain reviewers. In early 2014, the trial court ordered Yelp to comply with a subpoena and make the information available to the plaintiff, but last fall Yelp appealed to the state’s highest court, which is expected to issue a ruling soon.

More recently, Yelp fought a subpoena in a lawsuit filed by a Texas real estate firm looking for the real name of a reviewer whose Yelp writeup was allegedly libelous.

Some businesses have tried bizarre, highly questionable routes to short-circuit negative reviews before they ever get published, like dentists and other medical professionals who include clauses in their contracts claiming they actually own the copyright to anything written about their business online.

An apartment complex in Florida also tried to claim copyright on every word and image posted about tenants’ properties — until it was brought to the attention of the media and suddenly the management company disavowed its own policy.

Starbucks Celebrating Frappuccino’s 20th Year With Birthday Cake Flavor

Thu, 2015-03-26 18:51



When I turned 20 I added an extra package of ramen noodles to the pot and treated myself to some wine coolers that just happened to appear in my refrigerator. But it appears Starbucks is going the more traditional route to celebrate the 20th anniversary of its Frappuccino, by debuting a limited-time birthday cake flavor.

Starbucks first started experimenting with blended drinks in its Los Angeles store in 1993, and began selling coffee-flavored Frappuccino drinks in all of its 500 North American stores in 1995, reports CNNMoney.

Starbucks sold 200,000 Frappuccino drinks in the first week, doubling expected sales, according to the company’s director of brand management, Done Moore.

The icy concoctions now come in variations that don’t even include coffee, including the birthday cake drink it’s selling March 26 through March 30. The drink is made with vanilla bean and hazelnut flavors blended together and topped with “raspberry-infused” whipped cream.

It didn’t come up with the Frappuccino name, however, and instead acquired it when it bought The Coffee Connection, a Boston shop that served frappuccinos in a soft-serve machine.

The Frappuccino helped change the company by bringing people into the stores even when it was hot outside, Starbucks says, a time when many people eschew hot drinks in favor of icy refreshment.

“With Frappuccino, we were able to level out the dips in store traffic in the summer,” said Dina Campion, who oversaw 10 Starbucks stores in Southern California and was instrumental in bringing the Frappuccino about.

In its first summer, the Frappuccino accounted for 11% of sales, boosting the company stock to a record high.

Starbucks sells Birthday Cake Frappuccino to celebrate Frap’s 20th [CNNMoney]

Truck Full Of Salmon Turns Over On Highway, Blocks Traffic For 9 Hours

Thu, 2015-03-26 18:26

(Seattle Plice Department)

(Seattle Plice Department)

The creatures of the sea are rising up to…snarl our traffic and then get eaten anyway. First, a tractor-trailer in Maine overturned, but its cargo of 30,000 pounds of live lobsters were fine and survived to be loaded on another truck. Now a truck full of salmon turned over on a highway in Seattle, messing up traffic everywhere from down the road to in the sky.

It started around 2:30 in the afternoon when a truck carrying a trailer full of fish overturned, completely blocking SR-99 near Safeco Field, where the Seattle Mariners play. The traffic snarl meant that it was impossible to get paramedics in to attend to the driver. The truck was too damaged to move under its own power, and there was too much fish in the trailer to move it easily. Tow trucks capable of the job didn’t make it until 4 P.M., and the police weren’t able to move the truck, the trailer, and the tons of fish until seven hours after that because of damage to the trailer.

What took so long? SPD explains 9-hour semi crash cleanup [KOMO]

FTC’s Auto Industry Crackdown Includes Deceptive Advertising, Fraudulent Add-Ons & Improper Loan Modifications

Thu, 2015-03-26 18:21


A two-country crackdown on auto dealers’ deceptive, fraudulent practices culminated in six enforcement actions brought by the Federal Trade Commission resulting in more than $2.6 million in judgements and consumer refunds.

The Federal Trade Commission announced today that Operation Ruse Control, an initiative to protect consumers when purchasing or leasing a car included 252 state and federal enforcement actions in the U.S. and Canada covering a plethora of cases of deceptive advertising, automotive loan application fraud, odometer fraud, deceptive add-on fees, and deceptive marketing of car title loans

In all, Jessica Rich, director of the FTC, said during a conference call that the enforcement efforts include both civil and criminal charges against auto dealers and financial companies.

“For most people, buying a car is one of the largest purchases they’ll make,” Rich said. “Car ads must be truthful, loan terms must be clear, and dealer practices must be honest. That’s why our partners are working together to crack down on deceptive marketing about car sales, leasing and financing.”

Deceptive Add-On Practices
For the first time, two of the FTC’s cases involve the agency using its authority to take action involving deceptive add-ons – the practice of a dealer or other third-party adding to the vehicle sales, lease, or finance agreement charges for other products or services.

In many cases, add-ons are buried in consumer contracts, meaning purchasers are often unaware they are paying hefty fees for services such as extended warranties, road service, and theft protection they may not want.

The FTC alleges [PDF] that California-based National Payment Network, Inc. violated the FTC Act by deceptively pitching consumers an auto payment program – both online and through a network of authorized auto dealers – that it claimed would save consumers money.

However, NPN failed to disclose that the significant fees it charged for the services – averaging $775 – often cancelled out any actual savings.

In all, consumers who signed up for the Biweekly Payment Program through NPN were often charged an enrollment fee of $399, followed by $2.99 processing free for each payment made. When consumers decided to withdrawal from the program they were charged a $25 cancellation fee.

The FTC’s second add-on case against New Jersey-based Matt Blatt dealerships stems from the dealerships’ actions of regularly selling NPN’s add-on services, while failing to disclose the fees associated with the payment program.

According to the complaint [PDF], since 2009 Matt Blatt dealerships have received a commission of more than $1,000 for each consumer who enrolled in NPN’s add-on payment program.

Most consumers learned about the Biweekly Payment Plan after they selected a vehicle to buy at Blatt dealerships. At that time, the consumer signed legal paperwork closing the transaction with the company’s financing department, authorizing the add-on service.

Matt Blatt dealerships and NPN agreed to settle the FTC charges regarding the violations and are prohibited from misrepresenting that a payment program will save consumers money, unless the amount of savings is greater than the total amount of fees and costs charged in connection with the program.

Additionally, NPN will refund consumers more than $1.5 million and waive another $949,000 in fees currently owed by customers. Matt Blatt dealerships will pay $184,000 to the FTC.

No Truth In Advertising
In addition to complaints involving add-ons, a significant portion of Operation Ruse Control focused on dealerships’ use of deceptive advertising.

Rich said that deceptive advertising – including the promises of zero percent financing, and no down payments – was the most common issue FTC agents saw during the crackdown.

Three auto dealers – Florida-based Cory Fairbanks Mazda [PDF], Alabama-based Jim Burke Nissan [PDF] and California-based Ross Nissan [PDF] – agreed to settle FTC charges alleging they ran deceptive ads in violation of the FTC Act and the Truth in Lending Act.

According to the FTC complaints, the companies ran ads touting sales, lease or financing options that attracted consumers, but were cancelled in the fine-print disclaimers. In other cases, the dealerships’ disclaimers did not disclose relevant terms of the options, such as required down payments.

The FTC included this advertisement for Cory Fairbanks Mazda as evidence of deceptive advertising by the dealership. [Click to enlarge]

The FTC included this advertisement for Cory Fairbanks Mazda as evidence of deceptive advertising by the dealership. [Click to enlarge]

As evidence the FTC presented an advertisement posted by Cory Fairbanks Mazda that deceptively advertises various vehicles for purchase, including but not limited to the following advertisement for a Nissan Sentra, which is advertised as having a sunroof and spoiler, for a purchase price of $5,991.

However, further down in the advertisement, away from the sales price and below prominent contact information and in much less prominent print, the following information states that all prices are after $3,000 cash or trade equity plus all incentives and dealer add-ons.

“Must be present upon entering dealership. Not valid with other offers or discounts. Not valid on past sales. All lease payments are $3,000 down, 42 months, 10,000 miles per year plus tax, tag, and fees. All prices after $3,000 cash or trade equity plus all incentives and dealer add-ons.”

Thus, the FTC alleges in its complaint, the actual price of each of respondent’s advertised vehicles is $3,000 more than the dollar amount that is prominently displayed immediately below the vehicle.

Under the proposed settlement with the dealers, the FTC will prohibit the companies from misrepresenting the purchase cost or any other material fact about the price, sale, financing or leasing of a vehicle.

Worthless Loan Modifications
The final issue widely covered by the FTC involved the deceptive loan modification practices allegedly carried out by Florida-based Regency Financial Services and its CEO Ivan Levy.

According to the FTC complaint [PDF], the company and its executives allegedly charged consumer upfront fees to negotiate an auto loan modification on their behalf. However, in reality the company provided little to no service to the consumer.

Regency Financial Services advertised its loan modification process as being able to save consumers up to 50%.

Regency Financial Services advertised its loan modification process as being able to save consumers up to 50%.

At the FTC’s request, a U.S. District Court for Southern District of Florida temporarily halted Regency Financial Services practices and froze assets.

The case is ongoing, but the FTC plans to seek a permanent injunction to stop the company’s practices and refunds for consumers.

While the FTC’s complaints against dealerships and financial companies includes only civil cases, those brought by partnering agencies throughout the country also include criminal action that could result in executives named in the cases facing jail time.

Today’s action by the FTC is the agency’s second wave of Operation Ruse Control. Back in 2014, the Commission brought cases against 10 auto dealers for deceptive practices related to advertising.

FTC, Multiple Law Enforcement Partners Announce Crackdown on Deception, Fraud in Auto Sales, Financing and Leasing [Federal Trade Commission]

Cemetery Workers Won’t Stop Calling And Asking For Man Whose Ashes Have Been Interred There For 4 Years

Thu, 2015-03-26 17:37

(WKMG 6)

(WKMG 6)

It’s one thing to be annoyed by telemarketers who just don’t know when to quit. But it’s a hassle that shouldn’t follow you (or your loved ones) into the afterlife. The longtime partner of a man who died of lung cancer in 2010 says though his loved one was cremated and interred at a local cemetery, workers from that same cemetery keep calling the house and asking for the dead man by name.

The 51-year-old man had asked that he be laid to rest at cemetery memorial park, after driving past it every day on his job as a mail carrier, reports WKMG 6.

“I like the openness back here. And the quietness back here,” his partner says of the spot he frequently visits at the cemetery. “It’s calm here. Sad, but calm.”

Then two years ago, while he was at the home the couple used to share, the phone rang, with the Caller ID showing it was coming from the cemetery. He says he answered the phone and the worker asked to speak with the dead man by name.

“And at first it was just jarring,” his partner says. “The very place he’s at is calling to ask for him? I thought it was some kind of joke.”

He explained that the requested man wasn’t alive anymore, and in fact, was interred at the same cemetery the worker was calling from. As a reasonable person would do, he assumed his partner’s name was taken off the sales call list at that point.

Cut to six months later, when someone else from the cemetery called and asked to speak, once again, with the deceased.

“He’s there in your gardens,” his partner says he told the caller. “She said, ‘Oh my gosh!'”

A third call came six months ago, and again, he told the cemetery worker the man was dead, and a sales supervisor said his name would finally be removed from the list, he says.

But then on March 3? Another phone call from the same place. Six days after that? A fifth call.

“I don’t think I’m asking too much, I really don’t,” the deceased man’s partner says. He believes the company is trying to sell his late loved one upgraded funeral arrangements. Too late.

Because he and his partner had done business in the past with the cemetery, the company can call despite the fact that the number is on the Do Not Call list. But if someone asks a business to stop calling, it should do so.

“According to the rules of the Do Not Call program, a business should stop calling an individual when that individual asks the business to do so,” said a spokesman for Florida’s Department of Agriculture and Consumer Services. That agency hasn’t received any telemarketing complaints about the cemetery in question.

A spokeswoman for the cemetery’s parent company says it’s policy to remove customer’s from the list if asked.

“When we receive a request to remove a name from our call list, we make a notation in our database not to contact the individual. This removes the name from all call lists,” the spokeswoman said. “Occasionally, mistakes happen. In these circumstances we work to ensure our list is up-to-date.”

Seems like the company needs to work a bit harder on that up-to-date list.

“The credit card company stopped calling. Everyone else did. Nobody calls for him. But the place he’s buried can’t get it,” his partner says.

Cemetery repeatedly calls dead man [WKMG]

5 Costco Kirkland Signature Products May Be Just As Good As Name Brands

Thu, 2015-03-26 17:06



Costco members know they can often get a decent price on name-brand kitchen staples by shopping in bulk at the warehouse store. But if you’ve been ignoring the company’s store-brand Kirkland Signature line of products, you might be passing up on a chance to save even more without sacrificing quality.

Our colleagues at Consumer Reports have put together this longer list of ways to get the most out of a Costco membership, but we’ve pulled out the items that relate to Kirkland Signature products that can trim your shopping expenses without making you wish you’d spent more:

1. Laundry Detergent
Consumer Reports’ testing on Kirkland Signature Free & Clear liquid detergent found that it was tough on grass, blood, and ring-around-the-collar. It was as effective as the top-rated Tide Plus Ultra Stain Release, but at $.11/load, it’s less than half the cost of the Tide ($.25/load).

If detergent pods are more your thing, the Kirkland Signature Ultra Clean Pacs ($.15/load) also proved effective as vanquishing these stains.

2. Bacon
Store-brand bacon is rarely worth the savings, but Consumer Reports says that the Kirkland Signature Regular Sliced Bacon has a good crispiness and balance of fat and meat flavors. The price varies by location, but you can save around $1.50/lb over famous name brands.

3. Mayonnaise
This one may be sacrilege to devotees of Hellmann’s, but CR’s blind taste tests found that Kirkland Signature Real Mayonnaise is just as good as the more popular mayo brand. At only 60% of the cost of Hellmann’s, it might be worth trying that taste test out for yourself.

4. Batteries
Sure, you can save big on name-brand batteries when you buy in bulk at Costco, but the bulk pack of Kirkland Signature AA Alkaline batteries, which were rated excellent overall by CR, brings the per-batter price down to around $.27.

5. Organic Chicken Stock
When you hear “organic,” your instinct might be to also see dollar signs. But Consumer Reports says the Kirkland Signature organic chicken stock “served up impressive flavors, and at $12 for a case of six 32-ounce containers, it was about half the price of other top-scoring products from Knorr and Swanson.”

Check out the Consumer Reports story for more info on how to save at Costco.

Family Suing Publix Claims Boy Allergic To Nuts Died After Eating Cookie Worker Said Was Safe

Thu, 2015-03-26 16:26



The family of an 11-year-old boy allergic to nuts who died in June 2014 is suing Publix, claiming that his death was caused by a severe allergic reaction after eating a cookie a grocery store worker allegedly deemed safe.

According to the lawsuit reported by the Associated Press (warning: link includes video that autoplays), the Alabama boy was visiting family in Tennessee when he passed away soon after eating a chocolate chip cookie bought at a Publix store.

The lawsuit filed in federal court claims that the store bakery didn’t post warnings about ingredients or the potential for cross-contamination between products, and claimed that the mother only purchased the cookie after a worker told her it was safe.

The 11-year-old almost immediately started showing symptoms when he bit into the cookie at his aunt’s house, the lawsuit says. His mom gave him Benadryl and injected him in the thigh before an ambulance arrived, but his condition quickly worsened, a lawyer for the family said.

“It was horrible,” the family’s attorney said. “The child went into anaphylactic shock at his aunt’s house in front of his aunt and his mother and his cousins.”

The boy later died at a hospital.

His grandfather and mother filed the suit along with the boy’s aunt, who lives in Tennessee, with family members saying they hope the lawsuit brings attention to children with food allergies.

A Publix spokeswoman says that the company does post allergen information in its bakeries, but didn’t elaborate further on the case.

“Our thoughts are with the family over the loss of their child,” the spokeswoman said in a statement to the AP. “It would be inappropriate for us to comment on the pending litigation.”

Lawsuit: Boy, 11, died of allergic reaction to Publix cookie [Associated Press]

Union-Backed Campaign Asks Verizon “Where’s My FiOS?”

Thu, 2015-03-26 16:22

From the CWA's "Where's My FiOS?" flyer.

From the CWA’s “Where’s My FiOS?” flyer.

For years, it’s been obvious that Verizon lacked interest in expanding its FiOS fiberoptic pay-TV and Internet service beyond its existing footprint, even though the company had not fulfilled its promises in areas like New Jersey and New York City to make high-speed broadband available to everyone. And in January, Verizon officially extinguished any hope that FiOS would be bringing competition to new markets anytime soon. But a new campaign organized by the Communications Workers of America is asking consumers to demand that Verizon deliver the service it so proudly touts on TV.

The “Where’s My FiOS?” campaign points out that Verizon promised in 2008 that it would bring FiOS to all of New York City, where Time Warner Cable is by far the dominant player, by 2014. However, many parts of the city still lack access to a second option for broadband and Verizon doesn’t seem to be in any hurry to deliver.

The story is no different across the Hudson River in New Jersey, where Verizon had promised — in 1993! — to bring high-speed Internet service to 100% of the state by 2010. That obviously hasn’t happened and the company recently resorted to an astroturfing campaign trying to make it look like NJ residents were just fine with their lack of options.

Of course, the CWA would directly benefit from continued FiOS expansion as it would mean more work for the union’s members. Regardless of the the CWA’s underlying motive in nudging Verizon, any pressure on the company to make good on its promises and bring choices to consumers — especially those stuck with bottom-of-the-barrel Time Warner Cable service — is welcome.

Verizon maintains that it has lived up to all its obligations and projections, saying that the company has exceeded its goal of making itself available to 18 million homes nationwide. However, the fact that the company is increasingly shifting its time and capital investments away from its wireline business and toward Verizon Wireless implies that you shouldn’t expect FiOS in your area if it’s not already there.


RadioShack’s Future Comes Down To Saving Jobs Or Raising Cash For Lenders

Thu, 2015-03-26 15:32

(Phillip Pessar)

(Phillip Pessar)

What is the purpose of auctioning off the assets of a company that has declared Chapter 11 bankruptcy? Is it to keep some form of the company in business to keep workers employed, or is it to raise as much money as possible for creditors in order to make a dent in their losses? That’s the question in RadioShack’s bankruptcy auction. Bids are supposed to be finalized today, and there are two competing high bids: one that will keep a large number of stores open, and one that will raise cash for lenders.

Standard General has been the presumed winner until now, and their joint venture with Sprint would keep about 1,700 stores open as some form of RadioShack, which would be co-branded as Sprint stores to instantly expand Sprint’s retail footprint. Standard General argues that this move would preserve 9,000 retail jobs. The problem with this bid is that most of what Standard General is bidding with is RadioShack’s own debt to the company, and they’re only offering $16.4 million in cash. That’s great for Standard General, but less great for other lenders that RadioShack owes money.

Like Salus Capital, a lender that has has teamed up with three of our favorite retail liquidators: Hilco, Gordon Brothers, and Tiger Capital. Together, these companies have put together a higher cash bid so that more of the lenders can share at least something. The presence of so many well-known liquidators makes it clear what this group’s plans are for what’s left of the company, though.

It doesn’t matter how much money a resurrected RadioShack makes, since the new and smaller venture will be a separate entity free of the debt that led the current RadioShack to file for bankruptcy. That’s how Chapter 11 bankruptcy works, and why you needed to use your old RadioShack gift cards before March 5.

RadioShack Buyer Sees Rescued Jobs, Creditor Fears Losses [Bloomberg]

USPS Driver Shows Off Athleticism By Throwing Package, Running Lap Around Delivery Van

Thu, 2015-03-26 15:07



Wait a minute — are the Delivery Driver Games coming up and no one warned us? Why else would a United States Postal Service worker appear to be fine-tuning her athletic prowess by chucking a delicate package onto a porch before a quick lap around her delivery van?

Oh, wait. Those games don’t exist and so the worker throwing a package at an Oklahoma City house is probably just another careless delivery person with the bad luck to be caught on tape. At least she didn’t pee on the house, I guess.

In a YouTube video posted by the homeowner, CCTV security cameras capture the woman hurling the package — which contained a camera and Blu-Ray movies from Amazon, reports KOCO 5 News.

“I’ve never seen this person before, but usually we get pretty good service,” the resident says. “Seeing someone just toss it like that really gets on my nerves.”

The USPS tells the station it’s identified the woman in the footage and is taking steps to make sure the incident doesn’t happen again, though it didn’t add whether or not the woman had been fired.

“We take great pride in delivering the mail to the American public, that’s what we do, we do it every day,” a rep told KOCO.

Postal officials apologized to the package’s recipient, and Amazon is offering him 20% off as a result of the incident.

USPS worker tosses package, circles delivery van [KOCO 5]

Amazon Expands One-Hour Prime Now Deliveries To Dallas

Thu, 2015-03-26 15:07
(Alan Rappa)

(Alan Rappa)

The list of cities in which consumers can get one-hour delivery service on a plethora of products like paper towels, shampoo, books, toys and other essential everyday times from Amazon now includes Dallas. The company’s Prime Now, which already services Miami, Baltimore and New York City, is available to customers enrolled in Amazon Prime, which costs $99 a year and comes with free two-day shipping on thousands of items. [Amazon]

Colorado Lawmakers: Marijuana Edibles Must Look Different Than Regular Foods Even Without Packaging

Thu, 2015-03-26 14:59

(Heather Leah Kennedy)

(Heather Leah Kennedy)

After taking on the form of brownies, cookies, candy and other normal foods for years, edible marijuana goods must now figure out their own identity in Colorado. A proposed bill to loosen the requirements that say edible pot products must look distinctly different from normal food was rejected by a Colorado panel of lawmakers.

This means that not only do foods and beverages infused with marijuana have to come in packaging that explicitly states what’s going on inside, THC-wise, but the actual products themselves must be clearly different than non-marijuana-filled foods.

The 0-5 vote by the panel in rejecting a bill from Sen. Owen Hill is a big defeat for proponents of edibles in the industry, with Sen. Hill calling it an example of “micromanagement” because it’s not easy to do for all different kinds of foods, reports the Associated Press.

As it stands now, unless lawmakers change their minds and write a new rule, edibles will have to be “shaped, stamped, colored or otherwise marked, when practicable, with a standard symbol indicating that it contains marijuana and is not for consumption by children.”

Those behind the bill to loosen that restriction are unsure of how this can be carried off — after all, you can shape a pot cookie like a marijuana leaf, sure, but what about tomato sauce, for example?

“How we distinguish liquids versus granolas versus candies versus cookies versus brownies?” asked Sen. Hill.

Critics of the bill included parents, health advocates and even teenagers who told lawmakers about classmates passing around pot candies with parents none the wiser.

It would also serve medical professionals in helping them find out what’s wrong with a person in the emergency room, to help identify what they ate if it’s suspected they accidentally ingested pot.

“The ability to rapidly identify a suspected agent … with or without the packaging, we believe is critical,” said a doctor representing Children’s Hospital Colorado.

But those in favor of loosening the rules say the packaging can be changed to create a clear difference, and that that should be enough.

“As an industry, there’s no real way to clearly mark every item that’s out there,” said the president of Incredibles, a company that makes marijuana-infused candies. “That is impracticable.”

Lawmakers: Edible pot must look different than regular food [Associated Press]

American Apparel Says Former Founder, CEO Dov Charney Under Investigation By SEC

Thu, 2015-03-26 14:49



Any hope founder of American Apparel Dov Charney had of returning to the company may have gone out the window this week, after it was revealed that the Securities and Exchange Commission opened an inquiry into the circumstances leading to his departure.

The New York Times reports that American Apparel learned last month that the SEC had begun an investigation in matters related to Charney’s conduct while at the company, including the handling of company finances.

The company said in a filing this week that the investigation was initiated “with respect to matters arising from” the internal review into Charney’s behavior. American Apparel says it will cooperate fully with the investigation.

In June 2014 when Charney was first ousted, the company said that he was fired for allowing employees to be publicly shamed and for just being a jerk in general.

Company documents publicized after the initial ousting suggested that Charney misused company property and funds. In some instances, the board says Charney used American Apparel money to pay for family members’ travel, as well as letting friends use homes paid for by the company when they weren’t being used by Charney.

Problems continued to arise for Charney while he was acting in a consultant capacity for the company. Soon after he was suspended by the board, a video hit the Internet that purportedly showed him dancing around naked in front of employees.

Finally, in December, American Apparel announced that Charney would officially leave the company following an internal investigation for “alleged misconduct and violations of company policy.”

At the time, the company said “it would not be appropriate for Mr. Charney to be reinstated as CEO or an officer or employee.”

Dov Charney in S.E.C. Investigation, American Apparel Says [The New York Times]

Can New Payday Loan Rules Keep Borrowers From Falling Into Debt Traps?

Thu, 2015-03-26 05:01

Nearly one in four consumers continue to turn to high-cost, short-term financial products like payday loans, auto-title loans and other pricey alternatives when struggling to make ends meet, even though research shows these expensive lines of credit often leave consumers worse off than when they began. After nearly three years studying the issue, the Consumer Financial Protection Bureau is now announcing its first attempt to protect consumers from predatory lenders.

The CFPB is set to propose new rules for companies that provide payday loans, vehicle title loans, deposit advances, and certain high-cost installment and open-ended loans. The guidelines are intended to reduce the likelihood of borrowers falling victim to the vicious — and often devastating — cycle of debt associated with these financial products by preventing lenders from making loans that can’t be repaid.

The Bureau is also taking aim at payment-collection practices that take money directly from bank accounts in a way that frequently hits the borrower with hefty fees.

“Today we are taking an important step toward ending the debt traps that plague millions of consumers across the country,” CFPB Director Richard Cordray says in a statement. “Too many short-term and longer-term loans are made based on a lender’s ability to collect and not on a borrower’s ability to repay. These common sense protections are aimed at ensuring that consumers have access to credit that helps, not harms them.”

Ending Debt Traps For Short-Term LoansImage courtesy of C x 2 Section Permalink Bookmark Section Share on Facebook Share on Twitter

Short-term, high-interest loans offer borrowers a quick influx of cash to cover unexpected costs. Essentially, when a consumer takes out a payday loan, they are making a promise to repay that debt with their next paycheck or within 10-14 days, whichever comes first.

However, more often than not, payday loan borrowers — who tend to be among the country’s most vulnerable consumers with few other credit options — are unable to repay the full debt plus interest and fees in such a short time frame; or repaying in full leaves them unable to pay the bills for the next few weeks. That’s why payday lenders allow the borrowers to rollover their debts for an additional two weeks, while tacking on more fees of course.

Last year, the CFPB found that only 15% of borrowers were able to repay their debt when it was due without re-borrowing. By renewing or rolling over loans the average monthly borrower is likely to stay in debt for 11 months or longer.

The CFPB’s proposal to end this debt trap covers not only payday loans, but any credit product that requires consumers to pay back the loan in full within 45 days, so that also includes deposit advance products, certain open-ended lines of credit, and some vehicle title loans.

The CFPB is considering rules that would give lenders two ways to extend short-term loans without causing borrowers to become trapped in long-term debt.

Debt Trap Prevention

The first option for lenders is to eliminate debt traps by determining at the outset whether or not a consumer can repay the requested loan while maintaining their other major financial obligations and living expenses.

Other requirements of the rule would likely include:
• Lenders would generally have to adhere to a 60-day cooling off period between loans.
• The consumer could not have any other outstanding covered loans with any lender.
• To make a second or third loan within the two-month window, lenders would have to document
that the borrower’s financial circumstances have improved enough to repay a new loan without re-borrowing. They would have to verify, for example, that the consumer’s income had increased following the prior loan.
• After three loans in a row, all lenders would be prohibited from making a new short-term loan to
the borrower for 60 days.

Debt Trap Protection

Under the protection rule consideration, lenders would eliminate debt traps by providing affordable repayment options and by limiting the number of loans a borrower could take out in a row and over the course of a year.

This protection would include the following restrictions:
• The loan could not exceed $500, last longer than 45 days, carry more than one finance charge, or require the consumer’s vehicle as collateral.
• The consumer could not have any other outstanding covered loans with any lender.
• Rollovers would be capped at two – three loans total – followed by a mandatory 60-day cooling-off period.
• The second and third consecutive loans would be permitted only if the lender offers an affordable way out of debt. To achieve this, the Bureau is considering two options: (1) require that the principal decrease over the three-loan sequence so that it is repaid in full when the third loan is due; or (2) require the lender to provide a no-cost “off-ramp” if the borrower is unable to repay after the third loan, to allow the consumer to pay the loan off over time without further fees.
• The consumer could not be more than 90 days in debt on covered short-term loans in a 12-month period.

Ending Debt Traps For Longer-Term LoansImage courtesy of frankieleon Section Permalink Bookmark Section Share on Facebook Share on Twitter

While short-term loans are most often associated with the devastating debt traps, the CFPB’s proposed rules would also cover longer-term loans that carry the same three-digit interest rates and unaffordable payments.

The proposed rules would apply to credit products of more than 45 days where the lender collects payments through access to the consumer’s deposit account or paycheck, or holds a security interest in the consumer’s vehicle, and where the all-in annual percentage rate is more than 36%.

According to the CFPB, this classification includes longer-term vehicle title loans, some high-cost installment loans, and similar open-end products.

Much like the proposed rules for short-term loans, the proposal to end the debt trap associated with longer-term loans provides two alternative means of lending practices.

Debt Trap Prevention
Under the prevention requirements for longer-term loans, the CFPB would mandate lenders to determine whether or not the consumer can make each payment on the loan including interest, principal, and fees for any add-on products without defaulting or re-borrowing.

For each loan – whether initial or rollover – the lenders would have to verify the consumer’s income, major financial obligations, and borrowing history to determine whether there is enough money left to make payments on the loan after covering other major financial obligations and living expenses.

Other stipulations under the prevention rule would include:
• Lenders would be required to determine if a consumer is able to repay the loan each time the borrower seeks to refinance or re-borrow.
• If the borrower has been delinquent on a payment, the lender would be prohibited from refinancing into another loan with similar terms without documentation that the consumer’s financial circumstances had improved enough to be able to repay the loan.

Debt Trap Protection 

For the debt trap protection requirements, the CFPB is considering two options for loans that would have a minimum duration of 45 days and a maximum duration of six months.

Under the first approach, lenders would have to adhere to many of the same terms offered under the National Credit Union Administration program for “payday alternative loans.” These requirements include:
• The loan principal is between $200 and $1,000, and the balance decreases over the loan term.
• The lender could not charge an interest rate higher than 28% and an application fee higher than $20.
• The consumer has no other covered loans.
• The lender would only be able to provide two of these loans to a consumer within six months, and the consumer could only have one at a time.

The second approach mandates that longer-term lenders could only issue lines of credit if these specific conditions are met:
• The amount the consumer is required to pay each month is no more than 5% of the consumer’s gross monthly income.
• The consumer has no other covered loans.
• The lender does not provide more than two of these loans to the consumer in a 12-month period.

Putting An End To Harmful CollectionsImage courtesy of Newton Free Library Section Permalink Bookmark Section Share on Facebook Share on Twitter

While the CFPB’s proposed rule outline for short-term and long-term loans provides unique requirements for different lenders, the Bureau also tackled one of the more egregious and devastating aspects of small-dollar lending: collection practices.

Currently, both short-term and longer-term lenders often require access to consumers’ checking, savings or prepaid accounts before issuing credit. Such access allows the lender to collect payments directly from consumers in the form of post-dated checks, debit authorizations, or remotely created checks.

While this payment method may be convenient, it often leads to additional debt, as borrowers incur charges like insufficient funds fees, returned payment fees or account closure fees.

To alleviate additional debt burdens associated with short-term and long-term loans, the Bureau is considering certain restrictions on collection practices.

Requiring borrower notification before accessing deposit accounts

The CFPB would require lenders to provide consumers with three business days advance notice about the payment collection before submitting a transition to consumer’s bank, credit union or prepaid account for payment.

This proposal would cover payment collection attempts through any method and would help consumer better manage their deposit accounts and overall finances, the CFPB says.

Limit unsuccessful withdrawal attempts that lead to excessive deposit account fees

The second harmful debt collection proposal under consideration would limit the number of unsuccessful direct account collection attempts to two. After this point, the lender would no longer be able to attempt a collection directly from a checking, savings or prepaid account unless given a new authorization from the borrower.

The CFPB anticipates this requirement would limit fees incurred by multiple transactions that exacerbate a consumer’s financial woes.

It’s A Long Time ComingImage courtesy of Nathan Van Driel Section Permalink Bookmark Section Share on Facebook Share on Twitter

After waiting years for the CFPB to release details about a possible payday lending rule, consumer advocates from across the country were quick to embrace the preliminary rule outline, while pointing out areas of concern.

“The time is long past due for federal rules to protect payday loan borrowers from abusive practices,” Suzanne Martindale, staff attorney for our colleges at Consumers Union, tells Consumerist. “Today’s announcement is a step forward to promote safe and responsible lending practices.”

Representatives with the National Consumer Law Center say the proposal could go a long way in making small dollar loans safer for consumers.

“The CFPB has recognized that payday lenders must do what any responsible lender does: consider the borrower’s ability to repay the loan while meeting other expenses without needing to reborrow,” NCLC associate director Lauren Saunders says in a statement. “The CFPB has made clear that ensuring that a loan is affordable is the cornerstone of fair and responsible lending in the small dollar loan market, as in all credit markets.”

While the long-awaited proposal does span a range of loan products, Saunders says loopholes in the rules could permit some unaffordable high-cost loans to stay on the market.

“The CFPB has taken an ‘either/or’ approach: ‘prevention or protection,’” Saunders says. “But borrowers need both. Lenders must be judged both on whether they evaluate affordability before making a loan and also on whether those loans default, roll over or are refinanced in significant numbers.”

Additionally, NCLC questions the message the CFPB sends by allowing even one rollover for small-dollar loans.

“The proposal would permit up to three back-to-back payday loans and up to six payday loans a year,” Saunders says. “Rollovers are a sign of inability to pay and the CFPB should not endorse back-to-back payday loans.”

It’s Not Over YetImage courtesy of Section Permalink Bookmark Section Share on Facebook Share on Twitter

The rule-making process for short-term and long-term small-dollar loans is far from over for the CFPB.

Following today’s publication of the outline of the proposals under consideration, the CFPB will convene a Small Business Review Panel to gather feedback from small lenders.

In addition to the panel, the Bureau will continue seeking input from stakeholders in the lending industry before issuing a proposed rule.

Once the Bureau issues its proposed regulations, the public will be invited to submit written comments which will be carefully considered before final regulations are issued.

House Committee Asks Same Net Neutrality Questions As The 4 Previous Committees

Wed, 2015-03-25 23:21
(Brad Clinesmith)

(Brad Clinesmith)

FCC chairman Tom Wheeler was once again called before Congress today. His task: to justify the commission’s vote to protect consumers from the potential, likely harms of monopoly ISPs out to make a buck in any way they can. Or, in other words, to defend the agency’s recent vote on net neutrality.

Today’s hearing before the House Judiciary Committee is the fifth — and last — in a week-long marathon for Wheeler and some of his fellow commissioners. Since last Tuesday, Wheeler has been called upon to explain the net neutrality rule before the House Oversight Committee, the Senate Commerce Committee, the House Commerce Committee, and the House Appropriations Committee.

All of the hearings had one major theme in common: the FCC’s Open Internet order, while a good news for consumers, has a very long, very ugly, very political uphill battle to keep fighting here in Washington.

Today, chairman Wheeler and fellow commissioner Ajit Pai were in the hot-seats, along with FTC commissioners Joshua Wright and Terrell McSweeny.

After all four witnesses read their written testimony into the record, the Q & A portion of events kicked off. And it was adversarial from the start, every inch the free-with-facts back and forth with talking points that all of the net neutrality “debates” have been.

Committee chairman Bob Goodlatte of Virginia immediately began by interrogating Wheeler about existing, proven anticompetitive harms that had already happened in the internet marketplace. Finding Wheeler’s responses about wireless carriers insufficient, Goodlatte cut Wheeler off and turned to commissioner Pai instead.

Pai then claimed that the reason the order, as issued, did not include a list of explicit harms from just the last three years is because, “there is no evidence of a systemwide problem.”

Michigan Rep. John Conyers ran with that ball when his turn for questioning came up, asking Wheeler, “if there was much truth, or any” to the concept that “the internet’s not broken and there’s nothing for the FCC to fix.”

Wheeler, in turn, pointed out that since there are bills in Congress seeking to implement the bright-line rules of net neutrality — no blocking, throttling, or paid prioritization — without involving the FCC, that clearly he is not the only one who feels there might actually be a problem.

And so it went.

Later, Pai, in response to questions from Rep. Steve King of Iowa, cited Google Fiber as an excellent example of burgeoning competition of the kind that Title II will somehow stifle and destroy. However, just this morning — well after everyone has had a chance to familiarize themselves with the new rule — Google announced a further expansion of their service, this time into the Salt Lake City area.

Pai also repeatedly asserted, in response to questions from Rep. Ted Poe of Texas, that the United States has the best internet service in the world, and that Title II can only diminish our greatness. What Pai, Poe, and others in the hearing seemed to forget is that study after study after study after study finds that broadband in the U.S. is, at best, unevenly distributed and on average significantly slower and more expensive than in many other developed economies worldwide.

The rule, its metaphorical ink still not dry, already faces two legal challenges in court and is likely to face more once it is officially entered into the Federal Register. In the meantime, businesses are already looking for space in the rule’s grey areas that will allow them to sidestep the requirements.

Banks Aren’t Really Going To Replace Everyone’s Credit Cards This Year

Wed, 2015-03-25 22:54

(Jeremy P)

(Jeremy P)

Hey, remember how the major credit card companies were going to replace all of our magnetic stripe credit cards sometime this year with computer chip cards sometime this year? You know, like what the rest of the world uses? That isn’t happening. We’ll get our computer-chip cards, sure, and some retailers might be able to read them. However, banks might take until 2017 or so to replace all of our cards.

Yes, 2017. It’s possible that your bank or credit union might be waiting to switch out your current credit and ATM card when it expires, which pushes the date to convert the entire country out to 2017. CNN reports that one estimate is that maybe a quarter of all cards in the U.S. will actually be replaced by the end of 2015. (Warning: auto-play video)

Bank of America told CNN that most of its cards will be chip-laden by the end of the year, but not all of them. Not that it matters all that much, anyway: while cards with chips are safer from being cloned, that doesn’t mean baddies can’t get hold of your card number and go on an online shopping spree.

However, merchants might be the losers in this scenario: they have to replace their card readers, which will cost at least a few hundred dollars per cash register, or be liable for any fraudulent purchases made in their stores.

You’re about to get a new credit card … and it’s an epic failure [CNN] (Warning: auto-play video)

Walmart Entices Shoppers To Try Online Grocery Pickup With Discounts

Wed, 2015-03-25 22:29



Does the idea of placing an online grocery order at Walmart and then simply visiting the store to pick it up appeal to you? Walmart is now experimenting with a few pilot stores where you can do just that, and now they’re experimenting with special discounts to get customers to try it out.

Offering discounts for online orders makes sense: while they have to employ order pickers, a facility like Walmart’s new pickup-only grocery store near its mothership in Arkansas only needs to have pickup kiosks and a warehouse: there’s no need for retail aisles, pretty displays, or even cashiers. That could make pickup-only grocery more profitable…assuming that enough customers decide to try it.

In the industry, this kind of setup has a terrible acronym: BOPIS, or “buy online, pick up from store.” Walmart sent out e-mails offering $5 off any purchase or $10 off a $50 purchase to persuade customers to give it a try.

While ordering online and picking up at the store normally doesn’t save shoppers any time, in the case of a full grocery order that may be different. The Pickup Grocery test store is in Arkansas is a retail laboratory of sorts that’s meant to test this concept for possible implementation everywhere.

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Wal-Mart uses discount to woo more consumers to pickup format [City Wire] (via RetailWire)

Macy’s CFO: Sales Are Sluggish Because Women Don’t Want To Put Makeup On To Shop There

Wed, 2015-03-25 20:56

(The Caldor Rainbow)

(The Caldor Rainbow)

You there, with the bare lips and the TJ Maxx bag binge-watching Scandal online: Did you decide to skip Macy’s and head to an off-price store because you just couldn’t bear to tear yourself away from Netflix and put your face on that day? Macy’s CFO seems to think an aversion to lipstick and millennials’ love of digital content (among other things) is funneling customers away in favor of off-price stores, leading to sagging sales.

Macy’s reported 1.8% increase in revenue last quarter to $9.36 billion fell short of analyst expectations, and it’s the fault of those makeupless women and millennials shopping with mobile devices, Macy’s CFO Karen Hoguet explained during an industry conference on Tuesday, as reported by MarketWatch.

“We did some consumer research, and the customers said, she likes going to the off-price retailers because she doesn’t have to put lipstick on,” Hoguet said, according to a transcript of the event cited by MarketWatch, implying that said customer would feel pressured to slap on the war paint to go to Macy’s.

Along with that is the growing consumer trend of shopping for electronic devices and services like streaming media, and millennials’ habit of using mobile phones to shop instead of going into bricks-and-mortar stores, she added.

“I think part of that is the customers are buying other things, whether the electronics, cable services, Netflix, whatever,” she said, all things Macy’s doesn’t sell. There doesn’t seem to be any actual data linking the popularity of Netflix or other services to the downward slide of physical retail stores, however.

Macy’s is trying to remedy by that luring millennials into stores, where the retailer has had success selling them impulse purchases like cosmetics (need that lipstick to go shopping, natch), shoes and apparel. In an attempt to make that happen, Hoguet says Macy’s is focusing on getting millennials on board when they get engaged, and then keeping them once they’re hooked on flatware and bed skirts.

Macy’s didn’t offer MarketWatch a comment on Hoguet’s reported remarks, shoppers who hate putting on lipstick, or a link between paying for a monthly digital content subscription.

Macy’s CFO blames millennials, Netflix and lipstick haters on shifting retail landscape [MarketWatch]

American Express To Fight Court Ruling That Would Let Retailers Encourage Use Of Competing Cards

Wed, 2015-03-25 20:40



Back in February, a federal court ruled that American Express merchant agreements violate antitrust laws, resulting in higher costs for consumers, by forbidding retailers that accept AmEx from encouraging customers to use competing cards like those from Visa, MasterCard, and Discover. Today, the credit card company’s CEO said the company is asking the court to stay this ruling.

American Express typically charges merchants higher per-transaction fees than the competition, so it only makes sense that some retailers would want to nudge shoppers toward using the less-expensive option by, for example, offering a small discount for using a MasterCard. However, the AmEx merchant agreements include so-called “anti-steering” or non-discrimination provisions that forbid the retailer from doing anything to favor one card network over the other.

The court ruled this prohibition “results in higher costs to all consumers who purchase goods and services from these merchants.”

But according to the Wall Street Journal, American Express CEO Kenneth Chenault told investors today that the company intends to try to stay this ruling. If granted, that would allow the current anti-steering rules to remain in place while AmEx appeals.

“Fighting this suit was the right call in 2010 and continuing to fight is the right call now,” Chenault explained.

The appeals process can’t begin until after the court determines the remedy in the case; that issue was not resolved at the time of the ruling.