Continuing our walkthrough of the Bragg vs Linden Lab filings, we get to a companion filing to Rosedale's motion to have himself dismissed from the case (also 7 November 2006). This one starts sinking the boot in. It's also our first look at the Terms of Service in full-on legal-document action.

You see, the Terms of Service have an arbitration clause, when it comes to disputes, as for the rest of the document, they don't paint Bragg in particularly glowing terms. On with the fun...

What is Linden Lab asking for here? They're asking for dismissal of the complaint, on the basis that the Terms of Service that Bragg agreed to, that Bragg claimed not to have read at the time, contain an arbitration clause for disputes.

In the attached Memorandum, Linden Lab finally put forward their side of things, and it's not a flattering portrait for Bragg. Aside from alluding to the sheer length of Bragg's initial complaint, they assert that Bragg "knowingly violated" the rules, despite the complaint's attempt to paint Bragg as an innocent, and gullible victim.

Bragg is licensed to practice law in California, Pennsylvania and New Jersey, and touts his experience with "cyber-law", corporate law, copyright and trademark law, real estate law, trusts and estates, civil litigation and so on.

Is this the sort of man who clicks "I accept the terms of service" without even giving them a skim through? Especially if he is intending to transact business with that service and make a profit from it. Would you hire an attorney who would honestly shrug and say "Who reads those, anyway?"

He's even a member of the bar of the court before whom the case is to be taken. Linden Lab feels that this blows a lot of holes in Bragg's "I'm a n00b and I don't know what I'm doing" stance.

Linden Lab points out that this is the second time Bragg has filed the complaint. The initial, much shorter complaint was filed, and then withdrawn on the eve of the trial - without prejudice. 'Without prejudice' means that it's able to be refiled, and everyone covers their own costs. Now the complaint is back, grown to ten claims, 239 paragraphs and 46 pages. This is not a complaint that will make a judge smile, I think.

Linden Lab goes on to show that the Terms of Service contain an arbitration clause that requires any disputes to be resolved through arbitration in California. Remember the "long arm" statute? Bragg practices law, owns real-estate in California, and travels there frequently. The long arm can reach for him on that basis.

Linden Lab argues that the parties have entered into a valid contract when Bragg accepted the Terms of Service. After all, Bragg even said that he agreed to them (albeit unread). That Bragg agreed to abide by the Terms of Service is not in dispute, Bragg instead disputes that it is enforceable, valid or applicable, but that's a different story. In fact, Bragg agreed to them twice. Once during the signup process, and again during his first login to Second Life. Subsequently, Bragg could have reviewed the Terms of Service at any time, but claims not to have done so before his account was cancelled.

Linden Lab pulls out a lot of precedents that support their position about agreement to the Terms of Service constituting a binding contractual agreement. They also provide a counter-example where Terms of Service did not constitute such a contractual agreement due to a lack of consent.

Every lawyer, paralegal, attorney, counsel and solicitor that I have ever met has always said "Never sign a contract without reading it." It would be ridiculous to take Bragg at his word that he didn't - but ridiculous or not, that advice is there for a reason. That reason is that a contract is binding, whether or not you have any idea what it says.

Furthermore, Bragg's in trouble on this one. He claims that the emails that he got from the automated auction system constitute a valid, binding contract on Linden Lab. He can't have it both ways. Moreover, he can't have it this way. ProCD vs Zeidenburg (and others) as we said previously, validates the Terms of Service, as he had consent (and - in his own claims - consented); When it comes to the emails, Linden Lab didn't have consent, thus failing the basic test of Specht v. Netscape Communications Corp (and others).

So, we have a dispute. What's the arbitration process? "Binding Arbitration in San Francisco, California under the Rules of Arbitration of the International Chamber of Commerce by three arbitrators appointed in accordance with said rules."

Additionally the General Provisions further restate that California law will govern all disputes. Bragg obviously believes California law is generally applicable, more than half of his ten counts are based on California law. Linden Lab quotes the FAA (Federal Arbitration Act) ruling by the United States Supreme Court, which gives a district court no jurisdiction where the parties have agreed to an arbitration agreement.

Arbitration can be fought against, even with a plain agreement, but the argument has to be very very good.

Linden Lab goes on to claim that all the issues fall within the Terms of Service, and are thus subject to the arbitration process.

Now, this document is a package deal with the motion to dismiss Rosedale as a defendant. Either this goes to arbitration, Bragg vs Linden Lab and Rosedale, or Rosedale asks the court to uphold the dismissal, removing him from the case, as there would be no personal jurisdiction over him if the matter is not arbitrated in California. I don't actually see any reason why Rosedale should need to be a party even in arbitration. It's rather a generous give. Maybe he wants to sit there and smile while it all goes down.

The rest more or less amounts to a summing up of the above and a reiteration of the request that the court just toss this out with an order sending everyone to the ICC in San Francisco for arbitration.

There is an additional exhibit (PDF) showing the ICC's fees for three-arbiter arbitration, apparently generated by plugging in a contested value of $1 USD on the website. This totals $10,000 USD. If you want to dispute the Second Life Terms of Service or something under them, that's your minimum up-front fee for arbitration. I do not know whose exhibit this is.

The full Motion to Compel Arbitration is here (PDF).