You can't put literally anything into terms and conditions.
There's no way they included a portion that allows them to sell your stock, regardless of your knowledge or agreement of such. If they did, they can still be sued.
Doesn't matter. Not everything can be covered so easily. There are basic expectations from products and you cannot do just anything because you put it into your ToS. Back in Ebay's heyday, people lose civil suits where they try to sell pictures of an item when clearly the item was the expected product. "But the description says it's just a picture!!" Uh no... you cannot sell someone a picture of an iPhone for $700 and pretend you didn't mislead them.
I can put that I reserve the right to murder you without consequence in my ToC but if I did it, I can't point to that and say "Ah ha! He agreed to be murdered right here Mr. Judge."
Especially you cannot advertise yourself as a service that traditionally keeps your stocks safe, then have in your contract that they will do whatever they want with your stocks.
It's legal grey area, so a judge might allow it, but typically standard contracts must have expected provisions or else they must make the changes in expectations very apparent.
My guess is that RH will argue that it is a mutual fund, not a brokerage firm. And they will get crushed spectacularly by the courts. I have a feeling the courts may pierce the veil on this one based on the amount of publicity. People want metaphorical blood, and the political capital on the opposing side is weak. Expect to see the class action suit dig into the communications of Citadel. This one's either going to be a doozy or it's going to add kindling to the fire raging against the oligarchy.
You can't put literally anything into terms and conditions.
There's no way they included a portion that allows them to sell your stock, regardless of your knowledge or agreement of such. If they did, they can still be sued.
probably covered by the "we reserve the right to modify these terms at any time" clause.
Doesn't matter. Not everything can be covered so easily. There are basic expectations from products and you cannot do just anything because you put it into your ToS. Back in Ebay's heyday, people lose civil suits where they try to sell pictures of an item when clearly the item was the expected product. "But the description says it's just a picture!!" Uh no... you cannot sell someone a picture of an iPhone for $700 and pretend you didn't mislead them.
The issue is judges ruling properly.
that very last line sums it up nicely.
I still remember the smug look on that bitches face as she was trying to prove to judge judy that the ebay listing was for two iphone boxes, 500 each
Some things are just illegal.
I can put that I reserve the right to murder you without consequence in my ToC but if I did it, I can't point to that and say "Ah ha! He agreed to be murdered right here Mr. Judge."
It's in most brokerages terms. They can close your positions if their risk management department see it as too much exposure in your portfolio.
Especially you cannot advertise yourself as a service that traditionally keeps your stocks safe, then have in your contract that they will do whatever they want with your stocks.
It's legal grey area, so a judge might allow it, but typically standard contracts must have expected provisions or else they must make the changes in expectations very apparent.
My guess is that RH will argue that it is a mutual fund, not a brokerage firm. And they will get crushed spectacularly by the courts. I have a feeling the courts may pierce the veil on this one based on the amount of publicity. People want metaphorical blood, and the political capital on the opposing side is weak. Expect to see the class action suit dig into the communications of Citadel. This one's either going to be a doozy or it's going to add kindling to the fire raging against the oligarchy.
Robinhood has done it before when users were buying on margin. It's a different story when users are playing with Robinhood's money.
If it's a margin account they all make you agree to it when you sign up.