Nature of the Case
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Facts
D operates a service called Blockbuster Online, which allows customers to rent movies through the internet. D entered into an agreement with Facebook which caused D's customers' movie rental choices to be disseminated on the customers' Facebook accounts. If P rented a movie online, D would transmit P's choice to Facebook, which would then broadcast the choice to the P's Facebook friends. P sued D claiming that this violated the Video Privacy Protection Act, §2710, which prohibits a videotape service provider from disclosing personally identifiable information about a customer unless given informed, written consent at the time the disclosure is sought. The Act provides for liquidated damages of $2,500 for each violation. D invoked its arbitration provision in its 'Terms and Conditions.' That provision held that 'all claims, disputes or controversies . . . will be referred to and determined by binding arbitration.' It also states that any customer waives the right to commence any class action. All of D's customers were required to click on a box certifying that they had read and agreed to the Terms and Conditions. Ps argued that the arbitration provision is unenforceable, because (1) it is illusory; and (2) it is unconscionable.
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