In Re: Webloyalty.com, Inc., Marketing and Sales Practices Litigation

Filing 55

ANSWER to Amended Complaint by Webloyalty.com, Inc., Fandango, Inc., Priceline.com, Inc., Nelson Garrett, Maxim O. Khokhlov, Valueclick Inc., E-Babylon Inc.. (Attachments: # 1 Exhibit 1# 2 Exhibit 2# 3 Exhibit 3# 4 Exhibit 4# 5 Exhibit 5# 6 Exhibit 6# 7 Exhibit 7# 8 Exhibit 8# 9 Exhibit 9# 10 Exhibit 10# 11 Exhibit 11# 12 Exhibit 12# 13 Exhibit 13# 14 Exhibit 14# 15 Exhibit 15)(Mitrou, Joan)

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In Re: Webloyalty.com, Inc., Marketing and Sales Practices Litigation Doc. 55 Case 1:07-md-01820-JLT Document 55 Filed 07/20/2007 Page 1 of 67 UNITED STATES DISTRICT COURT DISTRICT OF MASSACHUSETTS IN RE WEBLOYALTY.COM, INC. MARKETING AND SALES PRACTICES LITIGATION MDL No. 07-01820 - JLT Lead Case: 06-11620-JLT DEFENDANTS' ANSWER TO CONSOLIDATED AMENDED COMPLAINT Defendants, Webloyalty.com, Inc. ("Webloyalty"), Fandango, Inc. d/b/a Fandango.com ("Fandango"), Priceline.com., Inc. d/b/a Priceline.com ("Priceline"), E-Babylon. Inc. ("EBabylon"), ValueClick, Inc. ("ValueClick"), Nelson Shane Garrett ("Garrett"), individually and d/b/a JustFlowers.com and Giftbasketsasap.com, and Maxim O. Khokhlov ("Khokhlov"), individually and d/b/a JustfFlowers.com and Giftbasketsasap.com (together, "JustFlowers"), pursuant to Fed. R. Civ. P. 8(b), hereby respectfully submit this Answer to the Consolidated Amended Complaint ("Consolidated Complaint"). Because the Consolidated Complaint goes beyond a short and plain statement as provided under Rule 8, Defendants respond in similar form in this Answer. I. NATURE OF CASE 1. Admitted only that Plaintiffs have filed the Consolidated Complaint as a putative class action against the named Defendants. Otherwise, the allegations of this paragraph are denied. 2. The allegations of this paragraph are denied. Further responding, Defendants state that the offers regarding the Reservation Rewards program, as made to each of the named Plaintiffs, were multi-step processes that made numerous, clear, complete and accurate Dockets.Justia.com Case 1:07-md-01820-JLT Document 55 Filed 07/20/2007 Page 2 of 67 disclosures. The process neither enrolled the named Plaintiffs (nor any other customer) automatically in the Reservation Rewards program (or any other program offered by Webloyalty), nor did it enroll them (or any other customer) without their knowledge or consent. Nor did the process entail the use or transfer of the named Plaintiffs' (or any other customer's) credit or debit card information without informed and affirmative consent. No customer is enrolled in the Reservation Rewards program (or any other program offered by Webloyalty) nor is his or her credit or debit card information used or transferred until a full and accurate disclosure of the program's terms has been made and the customer's consent and authorization has been given. Rather, each named Plaintiff (as is the case with all other customers) received full and accurate disclosures about the Reservation Rewards program, including the billing terms, and affirmatively chose to enroll in the program after receiving those disclosures. Each named Plaintiff's enrollment process and subsequent communications with Reservation Rewards is described below: PLAINTIFF KUEFLER Fandango Purchase and Enrollment in Reservation Rewards (a) Mr. Kuefler purchased movie tickets through Fandango on December 25, 2005. In order to select the show time, date, and number of tickets, Mr. Kuefler proceeded to the "Select Tickets" page of the Fandango website. At the bottom of the "Select Tickets" page was a box conspicuously and clearly labeled "Optional Offer" in large, bold typeface. The box provided an option ­ which Plaintiff Kuefler needed affirmatively to choose if he was interested ­ to learn more about the offer. No customer ­ including Mr. Kuefler ­ was required to click on the box in order to proceed with purchasing his movie tickets through Fandango. The box was unclicked by default. Thus -2- Case 1:07-md-01820-JLT Document 55 Filed 07/20/2007 Page 3 of 67 the customer would not be directed at this point to a page containing more information about the program unless, as Mr. Kuefler did, he or she affirmatively chose to learn more. Clicking on the box did nothing more than allow Mr. Kuefler to see a page giving full information about the terms and conditions of joining Reservation Rewards. Clicking on the box did not enroll Mr. Kuefler automatically in the Reservation Rewards program. Nor did it result in the transfer or use of any credit or debit card information. (b) Mr. Kuefler clicked on the "Yes" box in the "Optional Offer" box on the "Select Tickets" page and, as a result, expressed his interest in learning more about the terms of the Reservation Rewards program. After making this choice, Mr. Kuefler was next directed to a page that asked him to sign in to Fandango. (c) Mr. Kuefler signed in as a new Fandango customer on the sign-in page and thus was directed to a "Payment" page on which he could enter the credit or debit card information to be used for his ticket purchase. Regardless of what Mr. Kuefler filled in on the Fandango sign-in page, it did not result either in his being enrolled in the Reservation Rewards program or in the transfer or use of his credit or debit card information. (d) Because he clicked "Yes" in the "Optional Offer" box on the "Select Tickets" page, he was next directed to an enrollment page ("Enrollment page") setting forth all the details of the Reservation Rewards program. A true and accurate copy of the Enrollment page is attached as Exhibit 1. The Enrollment page clearly and conspicuously notified Mr. Kuefler of the terms of membership in the Reservation Rewards program. The Enrollment page prominently disclosed that the amount would be charged to the credit or debit card provided by the customer to Fandango: -3- Case 1:07-md-01820-JLT Document 55 Filed 07/20/2007 Page 4 of 67 For your convenience until you call to cancel, we'll automatically continue your benefits for just $10 a month billed by Reservation Rewards to the credit card or deducted from the debit card you use at Fandango today. Moreover ­ directly above the area in which the customer must enter his or her information in order to become a member of Reservation Rewards -- the Enrollment page prominently disclosed that, by accepting the offer, the customer was authorizing the transfer of his "name, e-mail address and credit or debit card information to Reservation Rewards for billing and benefit processing." The Enrollment page also disclosed four times that the customer would be billed a $10 monthly membership after the initial trial membership. More specifically, the page clearly and repeatedly disclosed: -- "Enjoy all this FREE for the next 30 days and only $10 per month thereafter" (first paragraph of the Enrollment page) (emphasis added); -- "30 days FREE plus only $10 a month thereafter" (immediately above the place where the customer is required to enter his or her email address twice and click "YES!" if he or she wishes to join Reservation Rewards) (emphasis added); -- "enjoy ongoing savings for only $10 a month thereafter" (in the scroll box immediately to the left of where the customer is required to twice enter his or her email address) (emphasis added); and -- "For your convenience until you call to cancel, we'll automatically continue your benefits for just $10 a month billed by Reservation Rewards to the credit card or deducted from the debit card you use at Fandango today." (In the scroll box immediately to the left of where the customer is required to twice enter his or her email address) (emphasis added). A true and accurate copy of the Enrollment page is set out below: [remainder of page intentionally left blank] -4- Case 1:07-md-01820-JLT Document 55 Filed 07/20/2007 Page 5 of 67 -5- Case 1:07-md-01820-JLT Document 55 Filed 07/20/2007 Page 6 of 67 (e) The scroll-down box (i.e., the yellow box above) clearly disclosed to Mr. Kuefler the offer and billing details of the Reservation Rewards program, as well as the fact that, by choosing to enroll, he was expressly authorizing the transfer and use of his credit or debit card information. More specifically, the scroll-down box disclosed: (a) the fact that the customer would be charged $10 per month after the 30-day trial membership; (b) that the credit or debit card information provided by the customer to Fandango would be billed by Reservation Rewards for the $10 monthly charge; (c) that the contact information provided by the customer to Fandango would be used for billing and benefit processing; and (d) that the customer could contact Reservation Rewards (at a toll-free number provided) at any time to cancel his or her membership and "owe nothing further." An enlarged copy of the disclosures contained in the scroll-down box on the Enrollment page is set out below: [remainder of page intentionally left blank] -6- Case 1:07-md-01820-JLT Document 55 Filed 07/20/2007 Page 7 of 67 Offer and Billing Details: Sign up for Reservation Rewards FREE for the next 30 days, with our compliments, and enjoy ongoing savings for only $10 a month thereafter. Plus get your $10.00 Cash Back Award on your next Fandango purchase. It's a Special Reward for being a valued Fandango shopper today! For your convenience until you call to cancel, we'll automatically continue your benefits for just $10 a month billed by Reservation Rewards to the credit card or deducted from the debit card you use at Fandango today. Reservation Rewards will also use the contact information you use at Fandango today for billing and benefit processing. Benefits may be modified without prior notice; but if we change your membership fee, you'll be notified before billing. If at anytime you are not satisfied, call Reservation Rewards at 1-800-7327031 to cancel and owe nothing further. Consent to receive electronic disclosures. Please read and save for your records. Reservation Rewards will convey your membership info and payment authorization via email and postings on our site. Your Membership Kit email will include a copy of the Offer and Billing Details. To view this info in electronic form you must have Internet browser version IE 5.5 or Netscape 4.7 or higher. To receive Reservation Rewards you must agree to receive communications electronically and by clicking Yes you consent to do so. You may withdraw consent by canceling the service. If you want a free printed copy of this information simply email us at customerservice@reservationrewards.com. You can update your email address on the Reservation Rewards profile page. Reservation Rewards Terms of Service Offer only available to residents of the U.S., Puerto Rico and the U.S. Virgin Islands and is not available to current Reservation Rewards members. Terms of Service apply. Reservation Rewards is owned and operated by webloyalty.com. All trademarks and or copyrights are the property of their respective owners, and unless otherwise noted, Reservation Rewards is not affiliated with the respective owners. Apple computer users need to print coupons using Netscape Navigator or Communicator. Merchants participating in this program vary by location. Reservation Rewards benefits cannot be accessed via WebTV. Privacy Policy ©2005, webloyalty inc. (Emphasis added.) -7- Case 1:07-md-01820-JLT Document 55 Filed 07/20/2007 Page 8 of 67 (f) All pertinent information was disclosed to Mr. Kuefler prominently and accurately in close physical proximity to where he took the affirmative steps to join the Reservation Rewards program. Specifically, the text immediately above the email signature boxes on the Enrollment page explained that, by entering his email address as his electronic signature, he was attesting to his having read the Offer and Billing Details and also authorizing the transfer of his credit or debit card information to Reservation Rewards for billing and benefits processing. In addition, immediately to the left of the signature boxes, was the "Offer and Billing Details" box, which was prominently offset by a different color and disclosed the fact that he would be billed $10 a month after an initial trial period and that the credit or debit card he used for his purchase would be used for that purpose. (g) Mr. Kuefler affirmatively took the following steps to authorize the transfer and use of his credit card information before enrolling in the Reservation Rewards program: (1) he clicked the "Yes" box in the "Optional Offer" box on the "Select Tickets" page, so as to receive more information about the Reservation Rewards program; (2) he clicked the "Continue" button on the "Select Tickets" page; (3) he typed his email address on the Enrollment page as specifically instructed; (4) he typed his email address a second time on the Enrollment page as required to proceed further; (5) he clicked the "YES!" button on the Enrollment page, as final confirmation of his consent. -8- Case 1:07-md-01820-JLT Document 55 Filed 07/20/2007 Page 9 of 67 Directly above the space in which the last three steps occurred was the following language that alerted Mr. Kuefler as to the significance of providing his electronic signature, the substance of what he was attesting to, and the consent he was giving: By entering my e-mail address as my electronic signature and clicking YES, I have read and agree to the Offer and Billing Details and authorize Fandango to securely transfer my name, email address and credit or debit card information to Reservation Rewards for billing and benefit processing. (h) It was easier for Mr. Kuefler to not join the Reservation Rewards program than it was for him to join. If Mr. Kuefler wanted to choose to enroll in the program, he needed to scroll down through the text describing the program all the way to the bottom of the Enrollment page. At that point, Mr. Kuefler was given the option of choosing not to enroll with a button marked "No Thanks". If, however, he still wanted to join the program, he needed to take three affirmative steps: (1) type his email address in the box provided; (2) re-type his email address in the verification box; and (3) click on the "YES!" button. (i) Plaintiff Kuefler was not enrolled in the Reservation Rewards program until all material terms of the program had been disclosed to him (including that the credit or debit card he used for his Fandango purchase would be charged $10 per month after the initial free trial period and that he could cancel his membership at any time), he had had the opportunity to read the terms of the offer, and he affirmatively took several steps to accept the offer, enroll in the program, and/or to authorize the billing of his credit or debit card. The same is true of all other customers of Fandango who, at or around the same time period, enrolled in the Reservation Rewards program through the Fandango website. No credit or debit card information was used or transferred until after Mr. Kuefler had taken the five affirmative steps listed above. -9- Case 1:07-md-01820-JLT Document 55 Filed 07/20/2007 Page 10 of 67 Post-Enrollment Communications concerning Reservation Rewards (j) At or about approximately 5:44 p.m. on December 25, 2005, shortly after he enrolled in the Reservation Rewards program, Mr. Kuefler was sent a confirmatory email with a subject line "As requested, your Membership Kit for Reservation Rewards, please login today", and describing the program and confirming its terms, including those concerning billing. A true and accurate copy of this form of email is attached hereto as Exhibit 2. Upon information and belief, Mr. Kuefler received this email and chose to ignore it. Among other things, the email confirmed and re-stated that Mr. Kuefler's credit or debit card would be billed $10 per month after the initial free 30-day trial period. In addition, the email explicitly and clearly told Mr. Kuefler that he could cancel his membership at any time and provided the toll-free telephone number that he could call should he wish to cancel his membership. (k) Seven days into Mr. Kuefler's trial period (i.e., on January 1, 2006), Webloyalty sent to Mr. Kuefler an email with a subject line "New member benefit update from Reservation Rewards" reminding him of his membership in the Reservation Rewards program. (l) Approximately a week later, on January 7, 2006, Webloyalty sent an email with a subject line "Your $10.00 Cash Back on next Fandango purchase" to Mr. Kuefler reminding him of his membership. (m) A few days later, on January 10, 2006, Webloyalty sent an email with a subject line "Benefit and billing reminder notice for Reservation Rewards Members" to Mr. Kuefler. Among other things, this email reminded Mr. Kuefler that, unless he elected to cancel his membership, his credit or debit card would be charged a $10 - 10 - Case 1:07-md-01820-JLT Document 55 Filed 07/20/2007 Page 11 of 67 monthly fee. The email also stated the last four digits of his credit or debit card that would be charged, and provided the name under which the charge would be made so that it would be easily identifiable on Mr. Kuefler's credit or debit card statement. The email also again gave Mr. Kuefler the instructions and toll-free number to contact should he wish to cancel his membership before being charged any amount at all. A true and accurate copy of this form of email is attached hereto as Exhibit 3. (n) On January 24, 2006, Mr. Kuefler's trial membership in the Reservation Rewards program ended and, accordingly, he was charged his first $10 monthly membership fee. On the same date, he was also again sent yet another reminder email confirming that he had enrolled in the program. Kuefler's Cancellation of Membership and Full Refund (o) On February 22, 2006, Mr. Kuefler contacted Webloyalty's toll-free number (which had been provided to him on numerous occasions over the previous two months) and requested that his membership in the Reservation Rewards program be terminated. His request was promptly granted. In addition, Mr. Kuefler requested a refund of the $10 previously billed in January 2006. This request, too, was granted and was processed the following day, February 23, 2006. Confirmation emails were sent to Mr. Kuefler on the same day confirming the cancellation and refund. Mr. Kuefler has not incurred any damages as a result of being enrolled in the Reservation Rewards program. (p) Despite the numerous reminders of his enrollment in the Reservation Rewards program, the repeated reminders of the terms of the program (including the fact that his credit card would be billed), and the repeated instructions as to how to cancel his membership and avoid any monthly charge, Mr. Kuefler did not seek to cancel his membership before the first $10 monthly charge was posted. - 11 - Case 1:07-md-01820-JLT Document 55 Filed 07/20/2007 Page 12 of 67 PLAINTIFF CROUSE Priceline Purchase and Enrollment in Reservation Rewards (q) Mr. Crouse conducted a transaction on the Priceline website on January 11, 2005. On Priceline, customers offer to purchase travel products (such as airline flights or hotel rooms) at a particular price. In Mr. Crouse's case, he purchased a hotel stay and, accordingly, was taken to a transaction acceptance screen ("Transaction Acceptance screen"). At that point, Mr. Crouse's Priceline transaction was complete and the Transaction Acceptance page contained information for his records. (r) The Transaction Acceptance screen contained two "banner advertisements" ­ or boxes of text containing an internet link ­ that would direct the customer to the Reservation Rewards Enrollment page, but only if the customer affirmatively chose to click on either one of the banners. In the top third of the page, at the right side, was a banner advertisement that stated: "Your request is complete. Click here to claim Special Offer!" and that included a grey button with the words "Continue" inside. At the bottom of the page, another banner read: "Click here to claim your Special Offer for your request today!" No customer ­ including Mr. Crouse ­ was required to click on either banner for any purpose with respect to his or her Priceline transaction. The banners were passive until activated by the customer, who needed to click on one or the other of the banners to indicate a desire to learn more about the offer. The customer would not be directed at this point to a page containing more information about the Reservation Rewards program unless, as Mr. Crouse did, he or she affirmatively chose to learn more about the offer. Clicking on either of the banners did nothing more than allow Mr. Crouse to see an enrollment page giving full information about the terms and - 12 - Case 1:07-md-01820-JLT Document 55 Filed 07/20/2007 Page 13 of 67 conditions of joining Reservation Rewards. Clicking on the banner did not enroll Mr. Crouse automatically in the Reservation Rewards program. Nor did it result in the transfer or use of any credit or debit card information. (s) Mr. Crouse clicked on one of the banner advertisements on the Transaction Acceptance screen and, in doing so, expressed his interest in learning more about the offer. After making this choice, Mr. Crouse was next directed to an Enrollment page setting forth all the details of the Reservation Rewards program. A true and accurate copy of the Enrollment page is attached hereto as Exhibit 4. The Enrollment page clearly and conspicuously notified Mr. Crouse of the terms of membership in the Reservation Rewards program. Among other things, the Enrollment page disclosed that membership in the program cost $9 per month, and also clearly disclosed that the amount would be charged to the credit or debit card provided by Mr. Crouse to Priceline: For your convenience Reservation Rewards will use the contact and credit or debit card information you provided to Priceline.com today for billing and benefit processing. Mr. Crouse was also informed that: Get your $10.00 Cash Back Award on your next Priceline.com reservation, Money-Saving Discounts for the next 30 days plus all the valuable benefits of Reservation Rewards for only $9, billed to the credit or debit card you used at Priceline.com today. The Enrollment page disclosed four times that Mr. Crouse would be billed a $9 monthly fee. More specifically, the page clearly and repeatedly disclosed: -- "Try all the benefits for the next 30 days for only $9 and see how much you save! There's no obligation to continue. If you are completely satisfied, do nothing and you'll enjoy ongoing savings for only $9 a month." (paragraph in the middle of the Enrollment page) (emphasis added); -- "Money-Saving Discounts only $9 a month!" (graphic on right-hand side of Enrollment page) (emphasis added); - 13 - Case 1:07-md-01820-JLT Document 55 Filed 07/20/2007 Page 14 of 67 -- "Get your $10.00 Cash Back Award on your next Priceline.com reservation, Money-Saving Discounts for the next 30 days plus all the valuable benefits of Reservation Rewards for only $9, billed to the credit or debit card you used at Priceline.com today." (in the Offer Details box immediately to the left of where the customer is required to twice enter his or her email address) (emphasis added); and -- "All your Reservation Rewards discounts and protection will automatically continue for just $9 a month billed by Reservation Rewards to the credit card or deducted from the debit card you used at Priceline.com today. (in the Offer Details box) (emphasis added). Moreover ­ directly above the area in which Mr. Crouse was required to affirmatively enter his information and electronic signature in order to become a member of Reservation Rewards -- the Enrollment page prominently disclosed that, by accepting the offer, Mr. Crouse was authorizing the transfer of his "name, address and credit or debit card information to Reservation Rewards for billing and benefit processing." A true and accurate copy of the bottom half of the Enrollment page is set out below. [remainder of page intentionally left blank] - 14 - Case 1:07-md-01820-JLT Document 55 Filed 07/20/2007 Page 15 of 67 - 15 - Case 1:07-md-01820-JLT Document 55 Filed 07/20/2007 Page 16 of 67 (t) The "Offer Details" box (i.e., the yellow box above) clearly disclosed to Mr. Crouse the offer and billing details of the Reservation Rewards program, as well as the fact that, by choosing to enroll, he was expressly authorizing the transfer and use of his credit or debit card information. More specifically, the "Offer Details" box disclosed: (a) the fact that the customer would be charged $9 per month; (b) that the credit or debit card information provided by the customer to Priceline would be billed by Reservation Rewards for the $9 monthly charge; (c) that the contact information provided by the customer to Priceline would be used for billing and benefit processing; (d) that the customer could contact Reservation Rewards (at a toll-free number provided) at any time to cancel his or her membership; and (e) that if the customer cancelled his membership during the first 30 days, the customer would "owe nothing further." An enlarged copy of the disclosures contained in the "Offer Details" box on the Enrollment page is set out below: [remainder of page intentionally left blank] - 16 - Case 1:07-md-01820-JLT Document 55 Filed 07/20/2007 Page 17 of 67 (u) (Emphasis added.) - 17 - Case 1:07-md-01820-JLT Document 55 Filed 07/20/2007 Page 18 of 67 (v) All pertinent information was disclosed to Mr. Crouse prominently and accurately in close physical proximity to where he took the affirmative steps to join the Reservation Rewards program. Specifically, the text immediately above the email signature boxes on the Enrollment page explained that, by entering his email address as his electronic signature, he was attesting to his having read the Offer and Billing Details and also authorizing the transfer of his credit or debit card information to Reservation Rewards for billing and benefits processing. In addition, immediately to the left of the signature boxes, was the "Offer Details" box, which was prominently offset by a different color and disclosed the fact that he would be billed $9 a month and that the credit or debit card he used for his purchase would be used for that purpose. (w) Mr. Crouse affirmatively took the following steps to authorize the transfer and use of his credit card information before enrolling in the Reservation Rewards program: (1) he clicked on one of the two banners on the Transaction Acceptance page, so as to receive more information about the Reservation Rewards program offer; (2) he typed his email address on the Enrollment page; (3) he typed his email address a second time on the Enrollment page as required to proceed further; and (4) he clicked the "YES!" button on the Enrollment page, as final confirmation of his consent. Directly above the space in which the last three steps occurred was the following language that alerted Mr. Crouse as to the significance of providing his electronic signature, the substance of what he was attesting to, and the consent he was giving: By entering my email address as my electronic signature and clicking YES, I have read and agree to the Offer Details and authorize - 18 - Case 1:07-md-01820-JLT Document 55 Filed 07/20/2007 Page 19 of 67 Priceline.com to securely transfer my name, address and credit or debit card information to Reservation Rewards for billing and benefit processing. (x) It was easier for Mr. Crouse to not join the Reservation Rewards program than it was for him to join. If Mr. Crouse wanted to choose to enroll in the program, he needed to scroll down through the text describing the program all the way to the bottom of the Enrollment page. At that point, Mr. Crouse was given the option of choosing not to enroll with a button marked "No Thanks, please take me back to Priceline.com". If, however, he still wanted to join the program, he needed to take three affirmative steps: (1) type his email address in the box provided; (2) re-type his email address in the verification box; and (3) click on the "YES!" button. (y) Plaintiff Crouse was not enrolled in the Reservation Rewards program until all material terms of the program had been disclosed to him (including that the credit or debit card he used for his Priceline purchase would be charged $9 per month and that he could cancel his membership at any time), he had had the opportunity to read the terms of the offer, and he affirmatively took several steps to accept the offer, enroll in the program, and/or to authorize the billing of his credit or debit card. The same is true of all other customers of Priceline who, at or around the same time period, enrolled in the Reservation Rewards program through the Priceline website. No credit or debit card information was used or transferred until after Mr. Crouse had taken the four affirmative steps listed above. (z) Immediately upon affirmatively enrolling in the Reservation Rewards program, Mr. Crouse was taken in the same browser window to a Reservation Rewards welcome screen ("Welcome screen") that began with the prominent phrase: "Welcome to Reservation Rewards!" and "Thank You Reward for Becoming a Reservation Rewards - 19 - Case 1:07-md-01820-JLT Document 55 Filed 07/20/2007 Page 20 of 67 member today!". A true and accurate copy of the form of the Welcome screen is attached hereto as Exhibit 5. The Welcome screen contained detailed information concerning the program and also repeated much of the information that had been disclosed to Mr. Crouse on the Enrollment page. More specifically, the Welcome screen repeated the details concerning the costs of the program to Mr. Crouse and gave the brand name and last four digits of the credit card he had authorized be billed. The Welcome screen also notified Mr. Crouse that charges to his credit card would be billed as "WLI*RESERVATIONREWARDS.COM 888-688-5995 CT." The Welcome screen also alerted Mr. Crouse to the fact that he would receive an email containing his membership kit. In addition, the Welcome screen again informed Mr. Crouse that he could cancel his membership at any time, and gave Mr. Crouse a toll-free number he could call to cancel and an email address he could use to contact Reservation Rewards customer service. Post-Enrollment Communications concerning Reservation Rewards (aa) At or about approximately 7:35 p.m. on January 11, 2005, shortly after he enrolled in Reservation Rewards, Mr. Crouse was sent a confirmatory email with a subject line "As requested, your Membership Kit for Reservation Rewards, please login today" describing the program and confirming its terms, including those concerning billing. Among other things, the email confirmed and re-stated that Mr. Crouse's credit or debit card would be billed $9 per month. In addition, the email explicitly and clearly told Mr. Crouse that he could cancel his membership at any time and provided the tollfree telephone number that he could call should he wish to cancel his membership. A true and accurate copy of this form of email is attached hereto as Exhibit 6. - 20 - Case 1:07-md-01820-JLT Document 55 Filed 07/20/2007 Page 21 of 67 (bb) On January 12, 2005, Reservation Rewards sent Mr. Crouse another email with a subject line "Benefit and billing reminder notice for Reservation rewards members" describing the program and reminding him that "your next $9.00 membership fee will be billed by Reservation Rewards to the credit card or deducted from the debit card you used to join and authorized Reservation Rewards to use for billing and benefit processing," and identifying that credit card by brand and its last four digits. A true and accurate copy of this form of email is attached hereto as Exhibit 7. The email further explained that the billing would occur on January 18, 2005, and provided a toll free number that Plaintiff could call if he wanted to cancel his membership and avoid billing. (cc) Reservation Rewards thereafter sent Mr. Crouse at least six additional reminder emails about his membership benefits. Crouse's Cancellation of Membership and Full Refund (dd) On February 8, 2006, Mr. Crouse used the Reservation Rewards automated phone system to cancel his membership. Mr. Crouse later that day requested a full refund, which was promptly granted. Confirmation emails were sent to Mr. Crouse on the same day confirming the cancellation and refund. Mr. Crouse has not incurred damages as a result of being enrolled in the Reservation Rewards program. (ee) Despite the numerous reminders of his enrollment in the Reservation Rewards program, the repeated reminders of the terms of the program (including the fact that his credit card would be billed), and the repeated instructions as to how to cancel his membership and avoid further charges, Mr. Crouse chose not to cancel his membership before February 8, 2006. - 21 - Case 1:07-md-01820-JLT Document 55 Filed 07/20/2007 Page 22 of 67 PLAINTIFF STAAF JustFlowers Purchase and Enrollment in Reservation Rewards (ff) Ms. Staaf conducted a transaction on the GiftBasketsasap.com website on December 19, 2005. At the end of her transaction, Ms. Staaf was taken to a confirmation page that contained a banner advertisement stating: "Your purchase is complete. Click here to claim your $10.00 Reward Certificate for your next purchase!" Below this banner was a "Continue" button on which Ms. Staaf was required to click if she wanted to receive further information about this offer. Only if a customer affirmatively chose to click on the "Continue" button would he or she be directed to the Reservation Rewards Enrollment page. (gg) No customer at any JustFlowers web site ­ including Ms. Staaf ­ was required to click on the "Continue" button for any purpose with respect to his or her transaction. Indeed, as the banner made clear, the customer's purchase was already complete. The banner was passive until activated by the customer, who needed to click on the "Continue" button to indicate a desire to learn more about the offer. The customer would not be directed at this point to a page containing more information about the Reservation Rewards program unless, as Ms. Staaf did, he or she took affirmative steps in order to learn more. Clicking on the "Continue" button did nothing more than allow Ms. Staaf to see an enrollment page giving full information about the terms and conditions of joining Reservation Rewards. Clicking on the "Continue" button did not enroll Ms. Staaf automatically in the Reservation Rewards program. Nor did it result in the transfer or use of any credit or debit card information. - 22 - Case 1:07-md-01820-JLT Document 55 Filed 07/20/2007 Page 23 of 67 (hh) Ms. Staaf clicked on the "Continue" button and, by doing so, expressed her interest in learning more about the offer. After making this choice, Ms. Staaf was next directed to an Enrollment page setting forth all the details of the offer. A true and accurate copy of the Enrollment page is attached as Exhibit 8. The Enrollment page clearly and conspicuously notified Ms. Staaf of the terms of membership in the Reservation Rewards program. Among other things, the Enrollment page disclosed that membership in the program costs $9 per month after a 30-day free trial period, and also clearly disclosed that the amount would be charged to the credit or debit card provided by the customer for her purchase: For your convenience Reservation Rewards will use the contact and credit or debit card information you provided to flower.com today for billing and benefit processing. Ms. Staaf was also informed that: All your Reservation Rewards discounts and protection will automatically continue for just $9 a month billed by Reservation Rewards to the credit card or deducted from the debit card you used at flower.com today. The Enrollment page disclosed five times that the customer would be billed a $9 monthly fee after the initial 30-day trial membership. More specifically, the page clearly and repeatedly disclosed: -- "Plus enjoy all this FREE for the next 30 days and only $9 per month thereafter." (first paragraph of the Enrollment page) (emphasis added); -- "There's no obligation to continue. If you are completely satisfied, do nothing and you'll enjoy ongoing savings for only $9 a month . . ." (paragraph in the middle of the Enrollment page) (emphasis added); -- "30 DAYS FREE plus only $9 a month thereafter" (in the green box on the left-hand side of the Enrollment page) (emphasis added); - 23 - Case 1:07-md-01820-JLT Document 55 Filed 07/20/2007 Page 24 of 67 -- "Sign up for Reservation Rewards FREE for the next 30 days, with our compliments, and enjoy ongoing savings for only $9 a month thereafter." (opening sentence of the Offer and Billing Details box) (emphasis added); and -- "All your Reservation Rewards discounts and protection will automatically continue for just $9 a month billed by Reservation Rewards to the credit card or deducted from the debit card you used at flower.com today." (in the first paragraph of the Offer and Billing Details box) (emphasis added). Moreover ­ directly above the area in which the customer must enter his or her information in order to become a member of Reservation Rewards -- the Enrollment page prominently disclosed that, by accepting the offer, the customer was authorizing the transfer of her "name, address and credit or debit card information used for my purchase at flower.com to Reservation Rewards for billing and benefit processing." An enlarged copy of the bottom third of the Enrollment page is set out below: [remainder of page intentionally left blank] - 24 - Case 1:07-md-01820-JLT Document 55 Filed 07/20/2007 Page 25 of 67 - 25 - Case 1:07-md-01820-JLT Document 55 Filed 07/20/2007 Page 26 of 67 (ii) The "Offer and Billing Details" box (i.e., the blue box above) clearly disclosed to Ms. Staaf the offer and billing details of the Reservation Rewards program, as well as the fact that, by choosing to enroll, she was expressly authorizing the transfer and use of her credit or debit card information. More specifically, the "Offer and Billing Details" box disclosed: (a) the fact that the customer would be charged $9 per month after an initial free trial period; (b) that the credit or debit card information used for her JustFlowers purchase would be billed by Reservation Rewards for the $9 monthly charge; (c) that the contact information provided by the customer during her purchase would be used for billing and benefit processing; (d) that the customer could contact Reservation Rewards (at a toll-free number provided) at any time to cancel her membership; and (e) that if the customer cancelled her membership during the initial trial period or thereafter, the customer would "owe nothing further." Both the phone number and email address for Reservation Rewards's customer service department were provided on that page. An enlarged copy of the disclosures contained in the "Offer and Billing Details" box on the Enrollment page is set out below: [remainder of page intentionally left blank] - 26 - Case 1:07-md-01820-JLT Document 55 Filed 07/20/2007 Page 27 of 67 - 27 - Case 1:07-md-01820-JLT Document 55 Filed 07/20/2007 Page 28 of 67 (jj) All pertinent information was disclosed to Ms. Staaf prominently and accurately in close physical proximity to where she took the affirmative steps to join the Reservation Rewards program. Specifically, the text immediately above the email signature boxes on the Enrollment page explained that, by entering her email address as her electronic signature, she was attesting to her having read the Offer and Billing Details and also authorizing the transfer of her credit or debit card information to Reservation Rewards for billing and benefits processing. In addition, immediately to the left of the signature boxes, was the "Offer and Billing Details" box, which was prominently offset by a different color and disclosed the fact that she would be billed $9 a month after an initial trial period and that the credit or debit card she used for her purchase would be used for that purpose. (kk) Ms. Staaf affirmatively took the following steps to authorize the transfer and use of her credit card information before enrolling in the Reservation Rewards program: (1) she clicked on the "Continue" button on the banner advertisement on her confirmation page, so as to receive more information about the Reservation Rewards offer; (2) she typed her email address on the Enrollment page; (3) she typed her email address a second time on the Enrollment page as required to proceed further; and (4) she clicked the "YES!" button on the Enrollment page, as final confirmation of her consent. Directly above the space in which the last three steps occurred was the following language that alerted Ms. Staaf as to the significance of providing her electronic signature, the substance of what she was attesting to, and the consent she was giving: - 28 - Case 1:07-md-01820-JLT Document 55 Filed 07/20/2007 Page 29 of 67 By entering my email address as my electronic signature and clicking YES, I have read and agree to the Offer and Billing Details and authorize the secure transfer of my name, address and credit or debit card information used for my purchase at flower.com to Reservation Rewards for billing and benefit processing. (ll) It was easier for Ms. Staaf to not join the Reservation Rewards program than it was for her to join. If Ms. Staaf wanted to choose to enroll in the program, she needed to scroll down through the text describing the program all the way to the bottom of the Enrollment page. At that point, Ms. Staaf was given the option of choosing not to enroll with a button marked "No Thanks". If, however, she still wanted to join the program, she needed to take three affirmative steps: (1) type her email address in the box provided; (2) re-type her email address in the verification box; and (3) click on the "YES!" button. (mm) Plaintiff Staaf was not enrolled in the Reservation Rewards program until all material terms of the program had been disclosed to her (including that the credit or debit card she used for her purchase would be charged $9 per month after an initial trial period and that she could cancel his membership at any time), she had had the opportunity to read the terms of the offer, and she affirmatively took several steps to accept the offer, enroll in the program, and/or to authorize the billing of her credit or debit card. The same is true of all other customers who, at or around the same time period, enrolled in the Reservation Rewards program through this website. No credit or debit card information was used or transferred until after Ms. Staaf had taken the four affirmative steps listed above. (nn) Immediately upon affirmatively enrolling in the Reservation Rewards program, Ms. Staaf was automatically taken to a Reservation Rewards Welcome screen that had the prominent phrase "Thank You Reward for becoming a Reservation Rewards - 29 - Case 1:07-md-01820-JLT Document 55 Filed 07/20/2007 Page 30 of 67 member today!" at its top. A true and accurate copy of the Welcome screen is attached hereto as Exhibit 9. The Welcome screen contained detailed information concerning the program and also repeated much of the information that had been disclosed to Ms. Staaf on the Enrollment page. More specifically, the Welcome screen repeated the details concerning the costs of the program to Ms. Staaf and gave the brand name and last four digits of the credit card she had authorized be billed. The Welcome screen also notified Ms. Staaf that charges to her credit card would be billed as "WLI*RESERVATIONREWARDS.COM 800-732-7031 CT." The Welcome screen also alerted Ms. Staaf to the fact that she would receive an email containing her membership kit. In addition, the Welcome screen again informed Ms. Staaf that she could cancel her membership at any time, and that upon cancellation she would owe nothing further. The Welcome screen also gave Ms. Staaf a toll-free number she could call to cancel and an email address she could contact. Finally, the Welcome screen informed Ms. Staaf of the precise date on which her free trial membership would expire. Post-Enrollment Communications concerning Reservation Rewards (oo) At or about approximately 1:13 p.m. on December 19, 2005, shortly after she enrolled in Reservation Rewards, Ms. Staaf was sent a confirmatory email with a subject line "As requested, your Membership Kit for Reservation Rewards, please login today" describing the program and confirming its terms, including those concerning billing. Among other things, the email confirmed and re-stated that Ms. Staaf's credit or debit card would be billed $9 per month after an initial free trial period. In addition, the email explicitly and clearly told Ms. Staaf that she could cancel her membership at any time and provided the toll-free telephone number that she could call should she wish to - 30 - Case 1:07-md-01820-JLT Document 55 Filed 07/20/2007 Page 31 of 67 cancel her membership. A true and accurate copy of this form of email is attached hereto as Exhibit 10. (pp) On December 26, 2005 and January 1, 2006, Reservation Rewards sent Ms. Staaf additional emails, encouraging her to claim her reward certificate and to use her membership benefits. (qq) On January 4, 2006, Reservation Rewards sent Ms. Staaf another email with a subject line "Benefit and billing reminder notice for Reservation Rewards members" describing the program and reminding her that "your next $9.00 membership fee will be billed by Reservation Rewards to the credit card or deducted from the debit card you used to join and authorized Reservation Rewards to use for billing and benefit processing," and identifying that credit card by brand and its last four digits. A true and accurate copy of this email is attached hereto as Exhibit 11. The email further explained that the billing would occur on January 18, 2006, and provided a toll free number that Plaintiff could call if she wanted to cancel her membership and avoid billing. (rr) Reservation Rewards thereafter sent Ms. Staaf at least three additional reminder emails about her membership benefits. Staaf's Cancellation of Membership and Full Refund (ss) Despite the numerous reminders of her enrollment in the Reservation Rewards program, the repeated reminders of the terms of the program (including the fact that her credit card would be billed), and the repeated instructions as to how to cancel her membership and avoid any monthly charge, Ms. Staaf chose not to cancel her membership during her free trial period. In fact, she chose to continue as a member of the Reservation Rewards program until March 22, 2006, when she contacted the Reservation Rewards toll free number and used the automated system to cancel her - 31 - Case 1:07-md-01820-JLT Document 55 Filed 07/20/2007 Page 32 of 67 membership. A confirmation email was sent to Ms. Staaf on the same day confirming the cancellation. On April 22, 2006, Plaintiff Staaf's credit card company notified Reservation Rewards that she had disputed the charges reflecting her three prior monthly membership fees. On that same day, Reservation Rewards credited those billings back to the credit card issuer. As a result, Ms. Staaf has not incurred any damages as a result of being enrolled in the Reservation Rewards program. PLAINTIFF MELO 123inkjets.com Purchase and Enrollment in Reservation Rewards (tt) On August 3, 2005, Mr. Melo conducted a transaction on the 123inkjets.com website. During the "check-out" process of his transaction, Mr. Melo was directed to a webpage that asked him to provide shipping, billing and other information concerning his purchase. If Mr. Melo wished to complete his transaction, he needed to click on the "submit my order" button at the bottom of this webpage. On information and belief, Mr. Melo clicked on the "submit my order" button. (uu) Mr. Melo was then directed to the Reservation Rewards Enrollment page, a true and accurate copy of which is attached as Exhibit 12. This multi-colored page automatically was displayed on Mr. Melo's computer screen. At the very top of the Enrollment page was a statement that made clear that Mr. Melo's 123inkjets.com purchase was complete and that the Enrollment page was an optional offer from another provider: "Your purchase is complete . . . here's a Special Reward from a preferred partner of 123inkjets.com!" (vv) Mr. Melo was not automatically enrolled in the Reservation Rewards program. Indeed, at the top of the Enrollment page, there was a clearly-displayed option - 32 - Case 1:07-md-01820-JLT Document 55 Filed 07/20/2007 Page 33 of 67 to decline joining the program. All Mr. Melo had to do was to click on the button clearly marked "No Thanks" next to the text "Just take me to the confirmation page" if he did not want to join the Reservation Rewards program. (ww) It was easier for Mr. Melo to not join the Reservation Rewards program than it was for him to join. All he needed to do to choose not to join was to click on the "No Thanks" button at the top of the Enrollment page. By contrast, if Mr. Melo wanted to choose to enroll in the program, he needed to scroll down through the text describing the program all the way to the bottom of the Enrollment page. At that point, Mr. Melo was again given the option of choosing not to enroll with a button marked "No Thanks" above the text "I want to get my confirmation page without the Reservation Rewards program or $10.00 Cash Back Award." If, however, he still wanted to join the program, he needed to take three affirmative steps: (1) type his email address in the box provided; (2) re-type his email address in the verification box; and (3) click on the "YES!" button. An enlarged copy of the bottom half of the Enrollment page is set out below: [remainder of page left intentionally blank] - 33 - Case 1:07-md-01820-JLT Document 55 Filed 07/20/2007 Page 34 of 67 - 34 - Case 1:07-md-01820-JLT Document 55 Filed 07/20/2007 Page 35 of 67 (xx) Mr. Melo did not click on the "No Thanks" button at the top of the Enrollment page. Instead, he scrolled down through the text describing the Reservation Rewards program on the Enrollment page. At that point, he again did not choose to decline the offer by clicking on the additional "No Thanks" button at the bottom of the page. Instead, he chose to enroll in the program by typing his email address twice and then clicking on the "YES!" button. (yy) In at least five places on the Enrollment page, Mr. Melo was clearly and accurately informed that, should he choose to enroll in the Reservation Rewards program, he would be charged $9 a month after an initial 30-day trial period. "Plus enjoy all this FREE for the next 30 days and only $9 per month thereafter . . ." (top of Enrollment page) (emphasis added) "Try all of the benefits for the next 30 days FREE and see how much you save! There's no obligation to continue. If you are completely satisfied, do nothing and you'll enjoy ongoing savings for only $9 a month . . ." (middle of Enrollment page) (emphasis added) "30 DAYS FREE plus only $9 a month thereafter" (middle bright green graphic) (emphasis added) "Sign up for Reservation Rewards FREE for the next 30 days, with our compliments, and enjoy ongoing savings for only $9 a month thereafter." (Offer and Billing Details box) (emphasis added) "All your Reservation Rewards discounts and protection will automatically continue for just $9 a month billed by Reservation Rewards to the credit card or deducted from the debit card you used at 123inkjets.com today." (Offer and Billing Details box) (emphasis added) (zz) Moreover, Mr. Melo was explicitly and accurately informed that, by entering his email address twice and clicking on the "YES!" button, he was attesting to his having read the Offer and Billing details, and was "authorize[ing] 123inkjets.com to securely transfer my name, address and credit or debit card information to Reservation Rewards for billing and benefit processing." He was also clearly and accurately informed - 35 - Case 1:07-md-01820-JLT Document 55 Filed 07/20/2007 Page 36 of 67 that "[a]ll your Reservation Rewards discounts and protection will automatically continue for just $9 a month billed by Reservation Rewards to the credit card or deducted from the debit card you used at 123inkjets.com today. For your convenience Reservation Rewards will use the contact and credit or debit card information you provided to 123inkjets.com today for billing and benefit processing." (aaa) All pertinent information was disclosed to Mr. Melo prominently and accurately in close physical proximity to where he took the affirmative steps to join the Reservation Rewards program. Specifically, the text immediately above the email signature boxes on the Enrollment page explained that, by entering his email address as his electronic signature, he was attesting to his having read the Offer and Billing Details and also authorizing the transfer of his credit or debit card information to Reservation Rewards for billing and benefits processing. In addition, immediately to the left of the signature boxes, was the "Offer and Billing Details" box, which was prominently offset by a different color and disclosed the fact that he would be billed $9 a month after an initial trial period and that the credit or debit card he used for his 123inkjets.com purchase would be used for that purpose. (bbb) The "Offer and Billing Details" on the Enrollment page clearly disclosed to Mr. Melo the offer and billing details of the Reservation Rewards program, as well as the fact that, by choosing to enroll, he was expressly authorizing the transfer and use of his credit or debit card information. More specifically, the "Offer and Billing Details" box disclosed: (a) the fact that Mr. Melo would be charged $9 per month after the 30-day trial membership; (b) that the credit or debit card information provided by Mr. Melo to 123inkjets.com would be billed by Reservation Rewards for the $9 monthly charge; (c) - 36 - Case 1:07-md-01820-JLT Document 55 Filed 07/20/2007 Page 37 of 67 that the contact information he provided to 123inkjets.com would be used for billing and benefit processing; and (d) that Mr. Melo could contact Reservation Rewards (at a tollfree number provided) at any time to cancel his membership and "owe nothing further." (ccc) Mr. Melo affirmatively took the following steps to authorize the transfer and use of his debit card information before enrolling in the Reservation Rewards program: (i) (ii) (iii) he typed his email address in the box provided on the Enrollment page; he typed his email address a second time in the verification box on the Enrollment page; and he clicked the "YES!" button on the Enrollment page, as final confirmation of his consent. Directly above the space in which these three steps occurred was the following language that alerted Mr. Melo as to the significance of providing his electronic signature, the substance of what he was attesting to, and the consent he was giving: By entering my email address as my electronic signature and clicking YES, I have read and agree to the Offer and Billing Details and authorize 123inkjets.com to securely transfer my name, address and credit or debit card information to Reservation Rewards for billing and benefit processing. (ddd) Mr. Melo was not enrolled in the Reservation Rewards program until all material terms of the program had been disclosed to him (including that the credit or debit card he used for his 123inkjets.com purchase would be charged $9 per month after the initial trial period and that he could cancel his membership at any time), he had had the opportunity to read the terms of the offer, and he affirmatively took several steps to accept the offer, enroll in the program, and to authorize the billing of his credit or debit card. The same is true of all other customers of 123inkjets.com who, at or around the - 37 - Case 1:07-md-01820-JLT Document 55 Filed 07/20/2007 Page 38 of 67 same time period, enrolled in the Reservation Rewards program through the 123inkjets.com website. (eee) As soon as Mr. Melo completed the Enrollment page a Welcome screen appeared automatically on his computer. A true and accurate copy of the Welcome screen ("Welcome screen") is attached as Exhibit 13. The Welcome screen, among other things, repeated the offer and billing details contained on the Enrollment Page. The Welcome screen appeared on Mr. Melo's computer automatically immediately after he completed his 123inkjets.com purchase and not only repeated the material terms of the Reservation Rewards program, but also repeated the information as to how he could cancel his membership at any time: If at anytime you are not completely satisfied during your trial or thereafter, simply call Reservation Rewards toll free at 1-800-732-7031 to let us know you wish to cancel your monthly membership benefits and owe nothing further. The Welcome screen informed Mr. Melo that charges to his credit or debit card would appear as "WLI*RESERVATIONREWARDS 800-732-7031 CT". The Welcome screen also provided an email address should Mr. Melo prefer to contact Reservation Rewards by that method instead of calling the toll-free number. (Id.) Post-Enrollment Communications concerning Reservation Rewards (fff) On August 3, 2005 (the date of his enrollment), at approximately 4:19 p.m., Mr. Melo was sent an email (Exhibit 14) with a subject line of "As requested, your Membership Kit for Reservation Rewards, please login today." This email, among other things repeated the offer and billing details, repeated that he would be charged $9 a month after the initial trial period, that those charges would be posted to the credit or debit card he authorized, that he could cancel his membership at anytime should he wish - 38 - Case 1:07-md-01820-JLT Document 55 Filed 07/20/2007 Page 39 of 67 and avoid any charges. Furthermore, this email repeated Mr. Melo's membership number, the address he had provided, the email address he had provided, the name under which charges would be posted to his credit or debit card (i.e., "WLI*RESERVATIONREWARDS 800-732-7031 CT"), the date on which his free trial period would end, and the name of his type of credit or debit card and its last four digits. (ggg) One week later, on August 10, 2005, Reservation Rewards sent Mr. Melo a reminder email entitled "New member benefit update from Reservation Rewards." This email again reminded Mr. Melo that he was a member of Reservation Rewards and urged him to take advantage of its benefits. (hhh) On August 16, 2005, Reservation Rewards sent Mr. Melo another reminder email concerning his membership in the Reservation Rewards program. (iii) Later on August 16, 2005, from the email address he had provided to enroll in the program, Mr. Melo sent Reservation Rewards an email. The fact that this email was sent by Mr. Melo from the email address he had provided as part of his enrollment indicates that (i) he was receiving Reservation Rewards' communications; and (ii) he knew how to get in touch with Reservation Rewards should he wish to do so-- whether to cancel his membership or otherwise. As of this date, Mr. Melo was still in the complimentary trial membership period and had not been charged any monthly membership fee. Mr. Melo did not seek to cancel his membership at this time. Had he done so (which he clearly knew how to do should he have wished to), he would have avoided any monthly fee. (jjj) Later that same day, Reservation Rewards promptly responded to Mr. Melo's email but heard nothing back from Mr. Melo at that time. - 39 - Case 1:07-md-01820-JLT Document 55 Filed 07/20/2007 Page 40 of 67 (kkk) On August 19, 2005, two full weeks before his complimentary trial period was to expire, Reservation Rewards sent Mr. Melo an email reminding him that, unless he elected to cancel his membership, his credit card would be charged a $9 monthly fee. The subject line of this email was "Benefit and billing reminder notice for Reservation Rewards members." This email identified the credit card by its brand and last four digits. In addition, the email explained how Mr. Melo could cancel his membership should he wish to do so before incurring any monthly charges. The email also provided a toll-free number to contact Reservation Rewards should Mr. Melo wish to cancel his membership. A true and accurate copy of the form of email Mr. Melo received on August 19, 2005 is attached as Exhibit 15. Mr. Melo's Cancellation of Membership (lll) Despite the numerous reminders and informational emails from Reservation Rewards in which he was repeatedly informed of the fact that he would be charged a monthly fee after the initial trial period, Mr. Melo chose not to cancel his membership during the free trial period. This was the case even though Mr. Melo knew how to get in touch with Reservation Rewards at the time, as demonstrated by his sending an email to Reservation Rewards on August 16, 2005 ­ two weeks before any charge was posted. (mmm)On March 9, 2006, Mr. Melo contacted Reservation Rewards's toll-free number (which had been provided to him on numerous occasions previously) and requested that his membership in the Reservation Rewards program be terminated. His request was promptly granted and processed. A confirmation email was sent to Mr. Melo on the same day to the email address previously on file for Mr. Melo confirming the cancellation. - 40 - Case 1:07-md-01820-JLT Document 55 Filed 07/20/2007 Page 41 of 67 3. The allegations of this paragraph are denied. Webloyalty states that the Reservation Rewards program provides numerous benefits to its customers including: (a) online access to Entertainment® book benefits (including many thousands of discount coupons from restaurants and retailers); (b) discounts to theme parks; (c) discounts on movie tickets; (d) emergency roadside assistance; (e) trip delay protection; (f) lost/delayed luggage protection; (g) hotel overbooking protection; (h) credit card fraud protection; (i) damage/theft/loss protection; (j) discounts on hotels; (k) car rental discounts; and (l) airline discounts. 4. The allegations of this paragraph are denied. Further responding, Defendants state that the enrollment process differed for each of the named Plaintiffs and for other customers who enrolled in the Reservation Rewards program, although no customer was enrolled without full and accurate disclosures concerning the program and without taking several affirmative steps, including providing an electronic signature, to signify his or her consent and to enroll in the program. The process of enrollment is accurately described in paragraph 2 above with respect to each of the named Plaintiffs. No customer's credit or debit card information is transferred or used without the customer's express authorization, manifested through several affirmative steps, including electronic signature. 5. Defendants lack information sufficient to admit the allegations of this paragraph, therefore those allegations are denied. Further responding, Webloyalty states that it takes numerous steps to communicate with customers who have enrolled in Reservation Rewards to remind them of their enrollment, the terms of the program (including charges for membership), how the charges would appear on their credit or debit card bills, how they can cancel their membership should they wish, and the benefits available to them as members. Each customer is typically sent several emails concerning his or her enrollment in the Reservation Rewards - 41 - Case 1:07-md-01820-JLT Document 55 Filed 07/20/2007 Page 42 of 67 program before he or she is charged any monthly membership fee. The emails are sent to the email address provided by the customer. Webloyalty relies on the accuracy of the email address provided by the customer. It is the customer's responsibility to read his or her emails and, to the extent that a customer chooses to ignore his or her emails concerning the Reservation Rewards program, the customer makes a choice that is not Defendants' responsibility. 6. The allegations of this paragraph are denied. Further responding, Defendants state that consumers are not "duped," as alleged, but rather choose to join the Reservation Rewards program after receiving full and accurate disclosures concerning the program. Nor are any e-tailers paid any fee for "ensnared" "subscribers." 7. 8. The allegations of this paragraph are denied. This paragraph contains no allegations, but rather consists of inappropriate argument, and thus no answer is required. To the extent that any response may be required, the allegations of this paragraph are denied. 9. Webloyalty admits only that some customers (including the named Plaintiffs) call and request that their membership be cancelled. Webloyalty states that it honors those requests promptly. The remaining Defendants lack information sufficient to admit the allegations of this paragraph and, therefore, those allegations are denied. Otherwise, the allegations of this paragraph are denied. 10. Webloyalty admits only that it responds to customers who contact the company and have complaints. The remaining Defendants lack information sufficient to admit the allegations of this paragraph and, therefore those allegations are denied. Otherwise, the allegations o

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