This story starts in December 2008 when Utah resident John Palmer ordered a couple of small gifts for his wife from the online retailer KlearGear.com. When the items were never delivered, Palmer and his wife, Jennifer, repeatedly attempted to contact the KlearGear and finally reached a customer service representative. According to Jennifer, the CSR would not give her a straight answer about the missing merchandise, so she wrote a scathing review on Ripoff Report, an online consumer rights site.
And that appeared to be the end of the story. The Palmers did not lose any money since PayPal debits an account only after an order is shipped. But fast forward three years and an email appeared in John’s mailbox that ordered him to delete the review from Ripoff Report or pay $3,500 for violating the “non-disparagement clause” of the KlearGear’s terms of service.
The Palmers refused, so KlearGear sent the “debt” to a collection agency, causing a drop in the couple’s credit rating. The Palmers sued, pointing out that the non-disparagement clause was not a part of KlearGear’s TOS when the order was placed. (A little online sleuthing found that the clause was added to KlearGear’s web site in 2012, long after the attempted purchase.)
KlearGear made no response to the lawsuit and a federal court earlier this year issued a default judgment for the Palmers in the amount of $306,750. That, finally, seemed to get KlearGear’s attention.
An email from the company dated May 19, 2014, claimed that KlearGear was “never properly served under the Hague Convention,” and that disparagement clause was included in the terms of service when Palmer made his order. Apparently, it was just somewhere other than where people looked.* Continue reading