Federal Court Clears Way for Class Action Suit vs. EarthLink, According to Bierhans, Delamere and Cohen, LLC.

Business Editors/Legal Writers

BOSTON--(BUSINESS WIRE)--Nov. 7, 2003

Internet Provider Could Pay for Disrupting Service

to Small Business Owners

The Law Firm of Bierhans, Delamere and Cohen, LLC today announced the Federal Appeals Court has cleared the way for a possible class action lawsuit against EarthLink(R) brought by Massachusetts subscribers.

The Court overruled an EarthLink motion to dismiss the case based on the company's assertion that their contracts contain an Arbitration Clause. EarthLink asserts subscribers lost their right to sue when they entered into a legally binding contract on line. But says Bierhans, the agreement did not contain an "I accept" button.

"In its decision this week, The Federal Appeals Court really addressed the fundamental issue of what constitutes an legally binding agreement online. We defended on the theory that there was no way that a consumer could assent to a contract, in a website, that they may never have seen," says Bierhans.

EarthLink purchased a local Cape Cod, Massachusetts ISP OneMain.com used by many small business owners to host their websites and receive email in 2001. The lawsuit asserts it was at this point services were interrupted, and websites and passwords disappeared, costing thousands of dollars in lost revenue. As many as 18,000 other Cape Cod subscribers were unable to connect to the Internet, and were forced to change established website addresses, and email addresses, or lose them.

West Waters, owner of Codders House of Furniture in Wellfleet, Massachusetts is the original plaintiff in the suit. "My website really is a major sales tool for my business. Our passwords wouldn't work. Orders couldn't be placed buy any of our longtime customers. New customers were on-line getting misinformation. We lost a major part of our marketing strategy. It was a nightmare," says Waters.

Waters filed suit against the publicly held EarthLink in Barnstable Superior Court in September of 2001 charging OneMain.com, the ISP EarthLink acquired, and EarthLink itself with breach of contract. The class action suit states the ISP's were "ill-equipped to handle the increase in customers" and as a result could not provide unlimited Internet access as stated in original service agreements. The case was originally moved from a local superior court to the Federal Court at the request of EarthLink's attorneys who thought the higher court would agree with their motion to dismiss.

The case ended up in the appeals court after a ruling by the U.S. District Court in Boston that gave Waters the go-ahead to proceed with his suit.

Atlanta-based EarthLink, Inc. has close to five million subscribers. "Much of the company's growth over the past two years can be attributed to acquisition of smaller providers," says Bierhans. "What has happened here in Massachusetts could be multiplied by thousands of EarthLink customers nationwide. The plaintiffs in this case could reach a very high number, one that EarthLink right now can't even anticipate."