I’ve gotten a few responses to my idea of a class action lawsuit against GPal. Unfortunately, that seems like a non-starter based on the User Agreement that goes along with the GPal service.
Fellow blogger Lawyer With a Gun, out of the goodness of his heart, looked into the issue for me. I’ve asked a couple of other lawyers to look into it as well to get different perspectives, but have gotten no dissenting opinions at this point.
I did look over the user agreement before signing up, but I have to admit that I just sort of skimmed it and didn’t get into details. It seemed pretty “boiler-plate” to me at the time and, heck…these are fellow gun owners, we can trust them, right?
Basically, there are a couple of points in the user agreement that are problematic.
In the event of any dispute, claim, question, or disagreement arising from or relating to this Agreement or the breach thereof, the parties hereto shall use their best efforts to settle the dispute, claim, question, or disagreement. To this effect, they shall consult and negotiate with each other in good faith and, recognizing their mutual interests, attempt to reach a just and equitable solution satisfactory to both parties. If they do not reach such solution within a period of 60 days, then, upon notice by either party to the other, all disputes, claims, questions, or differences shall be finally settled by arbitration administered by the American Arbitration Association in accordance with the provisions of its Commercial Arbitration Rules.
Any controversy or claim arising out of or relating to this Agreement, or the breach thereof, shall be settled by arbitration administered by the American Arbitration Association in accordance with its Commercial Arbitration Rules, and judgment on the award rendered by the arbitrator(s) may be entered in any court having jurisdiction thereof.
Just reading those points by themselves, I would take it to be referring to disputes between parties using GPal, not disputes with GPal itself, but it appears that I would be incorrect.
Apparently, by using the service, we agreed to attempt to negotiate a solution for 60 days, and then enter into arbitration to get the dispute settled.
I’m guessing that a court would throw out a lawsuit as a result.
Secondly, was this gem of a statement that I noticed while looking over Lawyer’s response to my questions:
14. Limitation of Liability
TO THE EXTENT PERMITTED BY APPLICABLE LAW, WE AND OUR AFFILIATES (AND OUR AND THEIR RESPECTIVE EMPLOYEES, DIRECTORS, AGENTS AND REPRESENTATIVES) WILL NOT BE LIABLE FOR ANY INDIRECT, INCIDENTAL, PUNITIVE, OR CONSEQUENTIAL DAMAGES ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT, THE SITE, THE GPal MATERIALS, THE SERVICE (INCLUDING THE INABILITY TO USE THE SERVICE), ANY APPLICATION USING OUR SERVICE, OR ANY SERVICES OR GOODS PURCHASED OR TRANSACTIONS ENTERED INTO THROUGH THE SERVICE. TO THE EXTENT PERMITTED BY APPLICABLE LAW, IN NO EVENT WILL AGGREGATE LIABILITY OF US OR OUR AFFILIATES (AND OUR AND THEIR RESPECTIVE EMPLOYEES, DIRECTORS, AGENTS AND REPRESENTATIVES) ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY, WHETHER IN CONTRACT, TORT (INCLUDING NEGLIGENCE, PRODUCT LIABILITY OR OTHER THEORY), WARRANTY, OR OTHERWISE, EXCEED THE AMOUNT OF FEES EARNED BY US IN CONNECTION WITH YOUR USE OF THE SERVICE DURING THE THREE (3) MONTH PERIOD IMMEDIATELY PRECEDING THE EVENT GIVING RISE TO THE CLAIM FOR LIABILITY. In no event will we be liable to you for any failure or delay by us (or our employees, agents, or representatives) in performing our obligations under this Agreement, regardless of whether the failure or delay is caused by an event or condition beyond our control.
The laws of certain states or other jurisdictions do not allow limitations on implied warranties, or the exclusion or limitation of certain damages. If these laws apply, some or all of the above disclaimers, exclusions, or limitations may not apply to you, and you may have rights in addition to those contained in this Agreement. Our liability is limited to the greatest extent permitted by law. [bold and text highlighting added -ed]
Granted, they admit that such disclaimers are void in some states that don’t recognize them; I would have to imagine that a disclaimer like this would be illegal anywhere, I find it difficult to believe that such a denial of any responsibility whatsoever to do anything resembling fulfilling obligations could possibly be legal…but in effect, GPal is claiming that, by agreeing to the terms of the User Agreement, users are agreeing that GPal isn’t bound by the terms of the user agreement. At all.
Do I need to say it again?
DO NOT USE GPAL…EVER!
As an aside, I find it interesting that the entire paragraph above is in all caps until you get to the part that I highlighted. almost like they were trying to downplay the importance of the section that claims that they aren’t legally bound to honor the agreement that they entered into. Hmmm.
Either that, or the section that isn’t in all caps was, perhaps, added to the agreement at some point after all these issues began cropping up back in May or June? I tried to find a cached page of the agreement that may have given me a clue, but had no luck with the Wayback Machine. Maybe someone knows of another internet cashing service that may have an older version of the agreement?
But I digress.
Many people are filing criminal complaints with their State Attorneys General, and filing complaints with the FTC. Lawyer suggested filing a criminal complaint with the Internet Crime Complaint Center Basically, I’d say that they are all good avenues. The more resources we can bring to bear and the more attention we can garner, the better.
It’s beginning to look more and more like this whole thing has been a Ponzi scheme from the beginning. That may turn out to be untrue and GPal may actually have the money they claim to have and truly may just be having problems getting it delivered where it’s supposed to go.
I wouldn’t bet on it.
There is a very good chance that those of us owed money may never see a penny. The best we can hope for is that, if this does turn out to have been a fraud, those responsible are held to account, and that’s where reporting this and filing claims comes into play. It can’t hurt to call or write your representatives in State and National government as well.
But, to my mind even more importantly than seeing justice done in this case, we need to prevent fellow gun owners and other citizens from becoming victims as well. This situation, whether it’s criminal in nature or just a result of negligence and incompetence, has already harmed countless numbers of people…primarily the very gun owners that the company was ostensibly supposed to be supporting.
We need to publicize this through every avenue available. The goal should be to see this company never see another new account established until every penny owed is paid in full, the company has been cleared of any wrongdoing or criminal activity, and the current ownership and management steps down and relinquishes control to new management.
If the above three conditions are not met, this company should fall, and the only way to ensure that it does, is to make sure that everyone, gun owners or not, knows what is going on. GPal itself is trying very hard to hide and cover up their failings, but we cannot let them do it.
The plot is thickening by the day and there are many other goings on.
Yesterday, I received the following e-mail from GPal support:
Dear Sir or Ma’am,
Due to the overwhelming number of support tickets and phone calls that we have seen here at Gpal lately and with full realization that this abnormal uptick in support tickets causes longer than normal customer service response times, we at Gpal have elected to make a more detailed message to help speed along our customer service abilities.
1. If you submitted a support ticket asking about the delays in customer service, know that this elongated message is a direct response to those inquiries. We are doing our best to make sure that everyone is taken care of. With this in mind, if you are concerned about the phone system and difficulties reaching a representative, please note only calls placed Monday through Friday between 9am-5pm PST are answered. All other times will result in an automatic disconnect. Please be advised that a more prompt response may be expected via e-mail rather than telephone calls and that telephone calls are for emergency help only. Calls placed in order to threaten representatives are illegal and a violation of the GPal AUP, illegal action at GPal will result in your account being locked and the matter referred to the appropriate authorities.
2. If you submitted a support ticket because you have not gotten a response to another support ticket, please keep in mind that responding to multiple support tickets from one person unduly bogs down the system. Abuse of our support system, including spamming our inbox (multiple support tickets with little variation on one day) will only get you banned from submitting more support tickets. We are painfully aware of your situation and are working as quickly as possible to resolve it and submitting multiple tickets only prevents us from helping other customers.
3. If you submitted a support ticket asking why you never received a check, please accept our deepest apologies for the delay. At the time many checks were supposed to go out we regained 100% ACH functionality and we will send funds back to you in the way it was originally chosen.
4. If you submitted a support ticket concerning your withdrawal not hitting your bank account within the 2-7 business day time frame, please be advised that due to an issue with the way we transmit your funds and a problem with one of our partner banks, there is a delay in the receipt of funds due to a backlog of our current withdrawals. We apologize for the undue delay and want you to know that we are working 24/7 to get this backlog caught up with.
5. If you submitted a support ticket that includes threatening rhetoric, please know that we take the safety of our employees seriously and we will forward any information we have to the proper authorities should the abuse happen again.
6. If you submitted a support ticket demanding personal responses or attention from the CEO or asking for clarification on his personal life, you will not be given such a response or such information under any circumstances.
7. If you submitted a support ticket accusing us of fraudulent or felonious activities, included but not limited to floating funds, voluntarily withholding funds, extortion or thievery, know that these accusations are wholly untrue and any further accusations will result in your information being forwarded to counsel for possible legal action against you.
8. If you have submitted an invoice to us for funds you are owed and are wondering why your account has been locked, know that the lock is only temporary and was done because submitting invoices to GPal for funds owed violates our Terms of Service.
Overall, please remember that we are working for you and that normal functionality is just around the corner. We realize that many have waited a long time for their funds and that is nigh inexcusable but believe us when we say that we are right in the same boat with you all and are fighting to have your funds released to you as soon as possible. In the meantime, please note that all funds are present at FDIC insured banks, and that the GPal team is working with your banks to get you access to your funds asap, as well as providing upcoming alternative ways (eg Debit Cards) to access your money in real-time. We thank you for your patience with us during this process.
The entire Gpal Support Team.
Your business is extremely important to us and we sincerely hope this response has answered your questions. If not, please reply directly to this email or create another ticket via the support request on the GPal website.
Need help NOW? You can call GPal toll free at 1-800-813-GPAL(4725) for friendly telephone support Monday through Friday, 9am till 5pm only.
Thank you for choosing GPal — the leader in transaction-neutral payment processing.
I’m not going to comment on the content of the e-mail other than to say that it strikes me as a bit of a “too little, too late” situation…and that point #7 just reinforces my opinion that this company and its dealings are shady at best. Threatening legal action against one’s customers hardly strikes me as a good way to do business. If the accusations aren’t true…DEMONSTRATE IT…preferably by making good on the money people are owed, or at least coming out with a plausible statement as to what is going on and specifically what is causing the delays. General statements about problems with the banks causing a backlog simply aren’t cutting it any more now that we’re at least 4 or 5 months into this fiasco. I can get quite a bit done in 24 hours all by myself. If the “GPal” team was TRULY working “24/7” to resolve these issues and clear the backlog…it would be done by now and we wouldn’t STILL be hearing nothing but excuse after excuse.
Moving on…It was brought to my attention by Uncle that, although still adopting a “wait and see” attitude, Oleg Volk has resigned from his (apparently figurehead) position on the GPal “Board of Advisors”.
So far, the best forum thread I’ve seen on the subject is over at Cast Boolits. The thread was opened back in July and has been ongoing throughout the heart of the controversy. both “GPalVP” of Calguns.net fame, and Ben Cannon himself, as well as the proprietor of the Calguns.net forum have contributed to the thread…sometimes very colorfully. The forum owner and moderator over at Cast Boolits has been very forthcoming about the fact that he is not going to prevent people from saying their piece and won’t be bullied into removing the thread or comments as other forums have done over this controversy.
It torqued “GPalVP” off so badly that he resorted to badmouthing Cast Boolits on other forums:
There are people that are owed thousands of dollars (into the tens of thousands) by GPal and there are now claims appearing that Ben Cannon has been calling the phone numbers on file with GPal and threatening people who have been posting about this situation.
Of course, Mr. Cannon is denying that he did such a thing, and I have to admit it seems like a pretty silly thing for him to have done…but time will tell…and the e-mail I quoted above shows that GPal staff are not shy about issuing threats. These calls have been reported to the authorities.
At any rate, as I said before, publicity is the key. If you’ve lost money to GPal, file your complaints and contact your representatives, but above all, publicize this. We want to stop this dead in its tracks and prevent others from being sucked in unsuspecting and being burned.