Xbox Dashboard Update Comes with Removal of Class Action Rights and Mandatory Arbitration Agreement

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Microsoft has joined the ranks of Sony, EA and others in demanding that you give up your rights to class action lawsuits and that any time you want to sue them you have to use their own appointed arbitration committee. This is all in the new terms of service for Xbox LIVE new rules on litigation includedtoday. Hopefully, all of these will be struck down soon by a court of law and reinstate your rights as a citizen of whatever country you live in to sue for damages when damages are incurred.

Your continued use of the Service is your acceptance of the changed contract, except that Section 18.111 permits you to reject changes to Section 18.1 (arbitration agreement) within 30 days of the change. If you use or receive software from us (Microsoft) as part of the Service, its use is governed by one of two sets of license terms: The license terms for the software or else this contract by default.

According to the new Terms of Service, you and Microsoft have 60 days to resolve a dispute. If  you do not you must then physically send them a letter by U.S. Mail to

Microsoft Corporation, ATTN: LCA ARBITRATION
One Microsoft Way, Redmond, WA 98052-6399

It must include:

  • Name
  • Address
  • Contact information
  • WIndows LIVE ID or gamertag
  • facts of the dispute
  • relief you seek.

You can find the form at

Under no circumstances can you, if you and Microsoft do not settle in 60 days, sue them anymore. Now it is all mandatory arbitration, before an allegedly neutral arbitrator. So my question is, do you get to help choose that arbitrator?

The only thing that you or they can sue over is then intellectual property.

They do leave you small claims court, but that must take place in your county of residence or King County, Washington, which is theirs. Same goes with arbitration for location.

If the dispute is $75,000 or less it states that they will "promptly reimburse your filing fees and pay the AAA administrative fees and the arbitrator’s fees and expenses, incurred in any arbitration you commence against Microsoft unless the arbitrator finds it frivolous or brought for an improper purpose. They will also pay their own fees.

Finally, if any part of the class action waiver is found to be illegal on unenforceable by judicial, legislative or other action, then most subsections won’t apply and those parts of the dispute will be taken out and sent to a court of law.

If you wish to reject the changes you have 30 days to send them written notice by US Mail and then you agree that you will informally negotiate and arbitrate any dispute with the most recent version of the section prior to your rejection.

In : PC

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