Hacker News Reader

Comment by mikeash | Hacker News Reader

What's going on here? The first half of the story sounds like routine corporate incompetency. Representatives don't read your stuff, can't be bothered to follow their own procedures, and screw you over. Unacceptable but, alas, fairly common when dealing with big companies.

The NDA is where it goes off the rails. He's entitled to that money, so why would they try to put conditions on it? I'm sure they're not thrilled to have him talking, but it's not like they have a choice in the matter. Once someone who is allowed to use their brains got involved, the result should have been a quick payment and an end to the saga.

View on HN

It's not unusual for settlements to have conditions attached, which makes this NDA thing somewhat less outlandish than it seems at first. For instance, if you settle with an insurance company after a car accident, you may have to sign something which says "that is it", waiving your right to sue anyone for anything more.

If the person is properly compensated 100%, but keeps talking, it can be argued that their material damage has been fully restored, while they continue to inflict material damage against the other party. Thus there is some unfairness there. AirBNB, the company, didn't wreck that apartment; the renters did.

Not that the devil would ever have me as his advocate, but let me play one for a second ...

> you may have to sign something which says "that is it", waiving your right to sue anyone for anything more

Isn't that quite different from an NDA though? With insurance, everything is documented and available for access in case you need to reference it at some later point in time. With an NDA, the settlement is effectively hidden from view and is much harder for you to legally discuss if you need to reference it at some later point. For example, if the owner decides to sell the apartment and the prospective buyer wants to know the history of any damages.

NDAs (aka confidentiality clauses) attached to settlements are extremely common - have you ever seen the phrase "settled for an undisclosed sum"? It's usually because of some sort of confidentiality clause. Here's some background on those, and why they're used:

http://www.americanbar.org/publications/gp_solo/2012/novembe...

Re: your house example, the NDA linked in the article don't go that far. IANAL, but it's actually pretty reasonable as far as I can tell. It basically says "I absolve AirBNB of any further responsibility, and I agree not to talk about this payout". That's it.

The AirBNB rep being asleep at the wheel is a real story and pretty lousy - however the NDA feels like a non-story to me.

https://drive.google.com/file/d/0B0k9tVdZvR1NUEtFTDZQUTQxZlk...

> It basically says ... and I agree not to talk about this payout"

That's not quite right. When I read the NDA, section 2 is what stuck out to me as an oddity that isn't standard in most settlement agreements. Specifically (emphasis mine):

> I acknowledge that the existence of the payment by Airbnb and this Airbnb Payment Agreement are confidential.

Most settlements make the amount paid a hidden number but doesn't prevent you from discussing that the settlement itself occurred. If Airbnb's NDA simply said that the amount paid wasn't to be discussed, then I'd agree that this would be a non-story. However, that doesn't seem to be the case here. IANAL either, but the language used seems pretty cut and dry in the intent that the incident be kept under wraps.

There is no settlement involved, because there is no legal claim, technically. None of the logic around legal settlements comes into play at all, so the devil's advocacy here is misguided. The NDA is outlandish and is clearly designed to shut him up and cover up the mishandling of the case.

This might be different under UK law, but if he had sued you might have a point. Then I'd expect gag, non-disparagement, forefeiture of claims and so on. I've signed those personally and understand that. But if I haven't sued you and you gag me for what I deem fair? Well, sounds like I should potentially sue because someone is not operating in good faith, and it ain't me. That move alone would make me want to discover your internal communications about handling me and in this case, I bet they're awesome.

Keep in mind they're writing him off from saying "they fixed this! They're the good guys!" which sure, seems unlikely, but if a company takes care of something without a lawsuit a gag seems counterintuitive and in bad faith.

I think the logic is pretty much identical. Abnb could, of course, simply refuse to pay anything. His recourse would be to the courts. The most likely outcome of that would be a settlement. The highest-dollar settlement would likely include confidentiality terms.

The incentive structure Abnb is creating here is not great, though: if you know their settlement terms will include confidentiality, and you know they have to settle somehow no matter what, your incentive as the aggrieved party is to get your story on the record immediately, before contacting Abnb, so that what you disclose can't violate their NDA. That's exactly what Abnb doesn't want to have happen.

They should probably just be up front about the fact that they'll pay a bonus to clean up the PR.

Sure. The suit would be public though, and exactly and to your point, wise plaintiffs would be subtly trying their case in the media from day 1, because that gag and non-disparagement is undoubtedly coming. Journos live for David vs. Goliath cases like this. Tossing a contract at me after the case gets a little attention, where I didn't have to sign one for the first payment, makes me wonder what you're hiding.

I totally get the logic you're saying, that they're basically treating it as a settlement, but that maneuver is odd and tips a little of their hand that he should perhaps just go hit the courts. When I was at AT&T they were a little rough settling with someone and she ended up suing, and part of the discovery was her internal notes on the case which blew up the claim by 20x. That's mostly what I'm thinking of, because there are for sure emails that would be very interesting to discover here.

Like I said, a gag smells when there's no suit.

They didn't pay "a bonus to clean up the PR" though. They eventually agreed to pay the £6400 costs the host had documented, and not a penny more.

In England if they offer you money, and you decline it and go to court, and you win but you win less than they've offered you get stiffed for costs.

> there is no legal claim

There might not be a lawsuit, but this sure sounds like a legal claim.

I would only expect that to happen in a case where there's some wiggle room. For example, I might expect it if I settled with an insurance company after a car accident, but I wouldn't expect it if I was obviously owed money by my insurance company.

The case here seems completely cut-and-dried. AirBnB owes this money, so they should pay it, end of story. I'd only expect an NDA if they were paying more than they had to. Thus the question I led with: what's going on? Either AirBnB is trying to pull a fast one here, or the case is not as clean as the story makes it sound.

Why would anyone "settle" without you agreeing that you weren't going to seek further damages? That's the whole meaning of "settlement."

Then it shouldn't be a "settlement" when you're obviously owed the money and there's no question about it. I don't "settle" every time I get a refund for a defective product or an insurance payout for some covered incident.

Does AirBNB routinely require non-disclosures for claims against its host guarantee?

We wouldn't know as this NDA states that host is forbidden from even acknowledging such a NDA exist.

How is that a settlement and not applying their terms and conditions as it should have been the first time ? Maybe even a bribe to shut him up before this has a chance to make headlines.

> If the person is properly compensated 100%, but keeps talking, it can be argued that their material damage has been fully restored, while they continue to inflict material damage against the other party.

Which they could handle in the same way that they would handle anyone else saying bad things about their brand. We should all have the same freedom of speech, within the same boundaries.

Right, like making them contractually promise to stop talking about it, in exchange for mutually agreed compensation.

As i understand it, Freedom of speech is not violated; you're still free to speak about it without going to government hunting you down. You're just breaking a contract you willingly signed, and have to deal with the ramifications of doing so.

It's not incompetence. It's a deliberate negotiating tactic, designed to tire the opponent and force him to agree to suboptimal terms.

Yeah it's a lot harder to ascribe something to incompetence when it just happens to help the "incompetent" party avoid a cost (or bad press).

Doesn't airbnb offer a $1M guarantee? I guess it is really a guarantee* subject to exclusions and NDAs.

Gag clauses are routine for this kind of thing. I'm a bit surprised you haven't heard of them already.

Maybe it's a more UK thing?

Here's one example around employment law, but similar clauses exist for pre-trial payouts of no fault "damages". http://www.telegraph.co.uk/news/politics/9967899/Gagging-ord...

Right, especially given that it seems like, had they been fair at the start, he'd likely never have gone to the media.

It's a legal settlement of a claim for money damages. Those usually do come with a confidentiality clause.

OK, but then why are they trying for a legal settlement rather than just paying the guy what he's owed?

Reply on news.ycombinator.com