The Dark Side of Netflix

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Netflix to Settle Class Action Suit

Netflix anticipates settling a consumer class action lawsuit over false advertising claims. The case, Frank Chavez v. Netflix, et al., was filed on September 23, 2004 in the California Superior Court, City and County of San Francisco on the grounds of false advertising, unfair and deceptive trade practices, breach of contract and other claims relating to Netflix’s statements regarding DVD delivery times.

Netflix has not officially admitted wrongdoing but is expected to settle the case for $3 to $4 million.

Current and former Netflix subscribers in other parts of the country who suspect Netflix of fraud and wish to file lawsuits are advised to consult their local attorneys.


Canceling Your Netflix Subscription

The two happiest days of your Netflix membership are the day you begin your subscription and the day you end your subscription. There is an ugly and unexpected twist to this, however. A surprising number of former Netflix subscribers have reported that after they canceled their memberships, Netflix denied receiving their final DVD returns.

When Netflix denies receiving a returned DVD from a customer who has recently canceled, Netflix charges the former customer’s credit card for that DVD. This practice exposes the former customer to dozens of dollars in additional charges after their subscription has ended. Unfortunately, the former customer is left holding the bag and has the burden of proving that the “missing” DVDs were actually returned.

If you want to cancel your Netflix subscription and minimize your exposure to additional charges, consider following the steps below.
  1. Determine your billing date by viewing your account information on Netflix’s Web site. Since Netflix cancellations are immediate and Netflix does not give refunds for partial months, you should plan to cancel shortly before your next billing date.
  2. Several days before you cancel your Netflix subscription, delete every DVD from your queue. This should prevent Netflix from shipping more DVDs to you.
  3. Send all of your DVDs back to Netflix. (Consider taking the extra precaution of sending these DVDs certified mail. Include a brief letter detailing the exact contents of the envelope. Keep copies of all documentation.)
  4. As Netflix notifies you of receipt of returned DVDs, save the notification emails in case you need them later for proof.
  5. The day you intend to cancel your subscription, check your account to see which DVDs have not been checked in by Netflix. Report any outstanding DVDs as lost. This should completely clear your queue.
  6. Send an email to Netflix informing them that you are canceling your membership. This will create more of a paper trail. (Note: Do not tell Netflix that you are canceling because you were not getting enough DVDs. Netflix loves when heavy users cancel.)
  7. Cancel your subscription using the Netflix Web site. Make sure to follow the on-screen instructions carefully.
  8. Sit back in your chair, grin, and enjoy a beverage of your choice as you celebrate the end of the dysfunctional relationship you had with that company.
The main drawback to this cancellation procedure is that you will loose about a week’s worth of DVD rentals. Unfortunately, if you want to minimize the chances of getting hit with extra charges from Netflix after you cancel, you have very few options.

After you have canceled, carefully check your credit card statements. If Netflix still charges your credit card for missing DVDs (or any other unjustified charges), immediately contact Netflix via email to dispute the problem. If Netflix does not fully credit the unjustified charges to your credit card, contact your credit card company and dispute the charges. In many circumstances, your credit card company will reverse the charges.