TurboTax maker Intuit faces tens of millions in fees in a groundbreaking legal battle over consumer fraud

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Rawstory.com – Faced with a class-action suit filed on behalf of customers who claim they were tricked into paying to file their taxes, TurboTax-maker Intuit knocked the case down. The company insisted its customers had agreed to forego their right to take their grievances to court and were required to use the private arbitration system instead.

But even as Intuit was winning in the class-action case, that very arbitration system was being weaponized against the Silicon Valley company.

A Chicago law firm is using a novel legal strategy by bankrolling customers bringing tens of thousands of arbitration claims against Intuit. Win or lose, this strategy could cost Intuit tens of millions of dollars in legal fees alone — a threat that could prod the company to be more open to a giant settlement.

Nearly three years after ProPublica first reported on how many customers wound up paying for TurboTax when they could have filed their taxes for free, Intuit is fighting a complex set of legal battles to stop consumers from trying to recover money.

Besides the huge number of consumer claims that have been filed, federal regulators and state-level prosecutors are also advancing efforts against the deep-pocketed company, which made $2 billion last year.

The most unusual front in the fight is the strategy to bring tens of thousands of individual consumer claims in arbitration, the alternative to the public court system that has historically been considered friendly to business.

Read More on This Story at Rawstory.com

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2 COMMENTS

  1. Please brighten up my dim light : how can Intuit have “trick” the user to pay for a tax filling software when the user “agrees” to buy a tax filling software ? Ignorance that he could have filled himself his tax forms is not a defense because it is a well known fact. As they say, “ignorance of the Law isn’t a defense”.

    A better case would be that Intuit is forcing the buyer to buy a software much too expensive for its needs, that is : paying for such amount to allow user to fill 8+12 tax forms when he always only needs 1 or 2 forms to fill.

  2. The privatization of the courts to assist 3rd party interlopers gouging the tax payers.
    No company this big should be able to force arbitration on all of its customers. We pay for the courts so they are there if we need them.
    TLOA is another one. Privatization of tax collection is not a good idea. Folks should make sure their counties do not sell tax liens. It creates an industry incentivized by raising property taxes.
    The upcoming trend, is the all out assault on small towns and counties being pushed into large loans to upgrade infrastructure. Only smart cohesive towns will be able to protect themselves.

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