Business

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Surprise FedEx Fee Jacks Up Tariff Charges

A friend recently ordered a pillow from Turkey. Unexpectedly, after the pillow arrived he got a bill with an extra charge. It was for the tariff. He was surprised but probably shouldn’t have been because under the law, it is normally the importer who is responsible for paying any tariffs on such goods. In this case, he was the importer.

Adding insult to injury, however, also on the bill was a service fee from FedEx. While the tariff itself was only $2.19, FedEx charged him a total of $17.19.

*MOUSE PRINT:

FedEx tariff bill

*MOUSE PRINT:

The tariff bill was so much higher than the actual tax because they added their own junk fee — a “disbursement fee”.

FedEx disbursement fee

Thanks for nothing, FedEx.

The temporary 10% tariff that was imposed after the Supreme Court struck down the president’s wide-ranging tariffs expired on July 24 but was quickly replaced with new tariffs.

So beware, purchasing goods directly from overseas may come with a costly surprise … or two.

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When Canceling Subscriptions Is Not Easy…

SiriusXMThere has been a movement lately by federal and state consumer authorities to make cancellation of subscriptions much easier. It is often said that cancellations need to be as easy as initial sign-ups.

In fact, the federal law called Restore Online Shoppers’ Confidence Act (“ROSCA”) has been on the books since 2010. It says for negative option plans, like subscriptions that continue from month to month until canceled provides:

*MOUSE PRINT:

…simple mechanisms for a consumer to stop recurring charges from being placed on the consumer’s credit card, debit card, bank account, or other financial account.

The New York Attorney General decided to go after SiriusXM for making it difficult for customers to cancel. They alleged that subscribers had to speak to a live agent, who, working from a prepared script, presented ever-more-enticing retention offers to discourage the member from cancelling. Basically, they were instructed not to take no as an answer.

Don't take "no" for an answer.

The New York Supreme Court took up the matter and ruled. While finding in favor of SiriusXM on various of the state’s legal theories of state law violations, they found that Sirius’ actions violated ROSCA. Specifically, the court pointed to a 2021 interpretive statement from the FTC that said in part that cancellation methods have to be as easy as their sign-up method, and that the companies should not subject consumers to new offers or similar attempts that unreasonably delay the consumer’s cancellation efforts.

Given those requirements, the court found in favor of New York and ordered that (monetary) damages be assessed.

(This story comes from the Mouse Print* archive of unpublished stories of consumer interest.)

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Can a Parking Lot Sign Mandating Arbitration Be Enforced?

A Colorado consumer who parked in an LAZ lot in Denver is suing that company (and others associated with enforcing parking lot rules at that facility) over a billing dispute. [See complaint.]

In the lawsuit, the consumer claimed that the parking companies involved illegally obtained his name and home address contrary to the federal Drivers Privacy Protection Act (DPPA) which limits who can access official motor vehicle department records. (Presumably those companies captured his license plate and obtained his registration information from the DMV.)

The parking companies told the judge that this matter needed to go to arbitration because there were supposedly conspicuous signs in the lot that told customers that any parking disputes had to be handled through arbitration.

Can merely having a sign hanging in a facility bind a customer to mandatory arbitration in case of a dispute?

*MOUSE PRINT:

Parking-arbitration sign

The judge recently ruled that a contract was formed:

… a reasonable driver knows that when they park in a parking lot, they agree to an implied contract with the lot owner: the lot owner allows the driver to park on their property, and the driver agrees to follow the rules laid out by the lot owner, including paying the required rates. If the driver does not follow the rules or does not pay, they may be subject to a ticket or their car being towed. The driver is free to leave the lot without parking if he does not want to agree to these implied terms …

But, with respect to arbitration, only one of the three companies who were being sued by consumer, can get out of the lawsuit. And that is the company named on the sign responsible for enforcing nonpayment issues. The other two companies, Laz and the company that provides the license plate reading technology that snagged this consumer, still have to face charges in court.

The judge did not accept the consumer’s argument that he failed to see the signs since it was dark. She found them to be conspicuous and in multiple locations, and the consumer chose not to learn the terms of this implied contract with the parking lot, that was his fault.

One has to wonder if this could lead to stores putting mandatory arbitration notices on their entrance doors (e.g., “If you enter the store, you agree to resolve any disputes with X retailer via arbitration”)?