AOL Lawsuit Information

AOL Overview

AOL is an Internet services and media company now owned by Time Warner, it was originally founded in 1983 as Quantum Computer Services. It got as big as it is by franchising its services to companies worldwide.

Most people know AOL thanks to its online service & software suite called "AOL." This service at one time had as many as 30 million members (who mostly accessed it through the AOL software).

AOL did start under another name - Control Video Corporation - and had one product, an online service called Gameline for the Atari 2600 video game console. By 1983 the company was near bankruptcy and under went a major reorganization. The company started making progress, and continued to grow into the 90s. At this point there were no reasons to file an AOL lawsuit.

The biggest change the company made was in its strategy. In 1985 it introduced a dedicated online service for Commodore 64 and 128 computers - dubbed Quantum Link or Q-Link. In 1988 Quantum and Apple did a quickie partnership deal, releasing AppleLink. The two companies parted ways in 1989 and Quantum became America Online.

AOL Problems & Legal Issues

AOL has lost roughly 800,000 customers over the last few years. It's rumored their broadband service isn't having much luck getting people to sign up.

At one time AOL used volunteers whom they called Community Leaders. These volunteers monitored chat rooms, libraries, message boards and even technical duties such as content design and maintenance. This use of "free" labor did eventually trigger the filing of an AOL lawsuit.

In 1999 hundreds of community leaders filed a class action lawsuit against AOL alleging violations of US labor laws (by paying community leaders with free AOL services). The Department of Labor launched an investigation, but didn't come to any conclusions. In turn AOL started reducing community leaders' roles in 2000 until they eventually ended the program.

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Reportedly AOL drags its feet stopping billing when customers cancer their accounts. They've also faced lawsuits over how they calculated minutes used online (which eventually caused them to change their billing methods).

At one time AOL added 15 seconds to the time a user was connected and then rounded up to the next whole minute. They didn't tell customers they were doing this, which is what caused a class action AOL lawsuit.

New York's Attorney General put AOL's customer service policies under close scrutiny in 2000. It seems there were accusations that AOL had a reward system for employees who saved subscribers calling to cancel.

It was alleged customer retention was done against consumer's wishes or without their approval. In 2005 AOL agreed to pay $1.25 million to the state of New York and reformed its customer service procedures.

In 2000, AOL was hit with an $8 billion lawsuit alleging that AOL 5.0 software "caused significant difficulties for users attempting to use third-party Internet service providers."

AOL 9.0 was labeled as being "badware" and was under investigation for installing extra software without telling its users, not to mention modifying toolbars, icons and browser preferences. The latest release in January 2007 was labeled as Vista Ready and is not considered to be badware.

AOL Lawsuits

In 2006, AOL agreed to shell out roughly $25m to settle a class action lawsuit that alleged they "wrongfully billed consumers". It was ascertained that AOL "wrongfully billed consumers for online services, such as additional AOL accounts, and other services and products, such as AOL Desk Planner, without first receiving consumers' consent or authorization".

In 2005 in Illinois a class action lawsuit accused AOL of illegally billing customers by creating secondary accounts for them without their approval. It was further alleged that "the company confused and deceived customers about the charges, stalled them from canceling unauthorized accounts and refused to return questioned fees."

In 2007 a family was sued by the RIAA (Recording Industry Association of America) and in turn filed a motion to have AOL and several other parties added to their suit. The family sought $8 million in damages from AOL and others.

Other AOL lawsuits:

AOL and Klausner Technologies were involved in a patent infringement suit over VOIP Total Talk & Voicemail services. Klausner granted a patent license to AOL to continue to use its Voicemail and VOIP services.

Investors on board for the AOL/Time Warner merger may get their money as a result of a $2.8 billion settlement to 625,000 investors, bondholders and other institutions. They allegedly lost money in a scheme that helped AOL inflate advertising revenue from 1998 to 2002.

In a 2007 lawsuit AOL was sued for patent infringement over their competitive bidding platforms. Performance Pricing alleged AOL violated a 1999 patent that states "a product/service within a specified price range, buyers accept the offer, in exchange for the opportunity to close the transaction at the lowest price offered by achieving a high score during the collateral activity."

Ignore the legal jargon, suffice it to say the above statement is highly similar to the advertising platform for AOL Search Marketplace.




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