Beijing Internet Court Platform Governance Top Ten Typical Cases
Beijing Internet Court
Top Ten Typical Cases
Advance Screenings on Demand Case: Unilateral Change of Standard Terms by Platforms Shall Not Damage Existing Rights of Users
—— Wu X v. Beijing XX Technology Company over Network Service Contract Dispute
This case, by examining the validity of standard terms of the network service platform, has the exemplary effect for the regulation of the service platform industry and plays an irreplaceable role in safeguarding the healthy development of the Internet platform industry. During the trial of this case, from the standpoint of coordinating and balancing the future development of the Internet industry and the protection of users’ rights and interests and on the basis of respecting the business model innovation of network service platform operators, the court recognized the validity of a unilateral change right clause that the defendant in this case set for itself through standard terms, but stressed at the same time that the exercise of the unilateral change right must be restricted by the principle of fairness and must not damage the legitimate rights and interests of users; otherwise the specific terms that are modified shall be invalid. Through this case, the public will realize that the legitimate rights and interests of users, no matter how small, will be under the care and protection of laws; while operators of network service platforms should realize that they must follow the principle of fairness, respect the feelings of users and abide by laws and regulations in the process of exploring new business models. This case was included in the Work Report made by the Supreme People’s Court at the Fourth Session of the 13th National People’s Congress and selected as one of the Ten Major Commercial Cases of Courts in China in 2020. The judgment of the case was selected as one of the “One Hundred Outstanding Adjudication Documents” in the Third Session of the Selection Campaign among courts in China, and won the first prize in the “Online Mutual Evaluation and Selection Campaign of Excellent Judgment Documents of Beijing Courts”. The judicial suggestions sent based on the case won the second prize among the judicial suggestions of Beijing courts.
The plaintiff was a gold VIP member of the defendant’s platform. In the VIP Membership Service Contract, Clause 3.5 stipulated that “advance screenings on demand of TV series: according to its own actual operation needs, the defendant will provide the service model of early access to TV series episodes for some video content regularly updated on the defendant’s platform, so that members can watch more episodes of such video content ahead of schedule after extra payment. The specific on-demand rules shall be subject to the actual explanation or provision by the defendant’s platform”; the second paragraph of the Introduction part stipulated that “both parties agree that the foregoing exemption and limitation of liability clauses do not belong to the clauses stated in Article 40 of the Contract Law as ‘exempting one party from liability, aggravating the liability of the other party or excluding the other party from its main rights’, namely, both you and Beijing XX Technology Company recognize the legality and validity of the foregoing clauses, and you will not claim the clauses in the agreement as illegal or invalid on the ground that Beijing XX Technology Company has failed to fulfill its obligation of giving reasonable reminders”; Clause 3.1 stipulated that “the defendant has the right to change all or part of the membership rights and the applicable device terminals of users based on its own operation strategy”; Clause 10.2 stipulated that “both parties agree that for the resolution of disputes, the latest VIP Membership Service Agreement agreed by you shall prevail.”; and Clause 3.3 stipulated that “you understand and acknowledge that for certain Contents, due to copyright owners or otherwise, there will still be advertisements in the video’s preamble, which shall not be seen as the defendant’s infringement or breach of contract”. The plaintiff held that the defendant introduced the “paid advance screenings on demand” model during the broadcasting of the TV series Joy of Life, requiring him to pay extra to watch the latest episodes and thus damaging the benefits of VIP membership that he should enjoy. In addition, the “VIP Membership Service Agreement”, having been unilaterally amended by the defendant and containing several illegal clauses, should be invalid.
[Key Points of Adjudication]
The “advance screenings on demand” model itself has nothing wrong, but shall not damage the existing benefits of VIP membership
The court held that relying on the Internet technologies, the differentiated needs of the people for work and life were gradually met, and personalized expressions were able to be realized. The industrial models of serving people’s needs should be tolerated. Since the “membership” service model launched by video platforms based on the consumers’ willingness to consume had been accepted by the public, there was nothing wrong with digging deep into the needs of users, creating differentiated and adaptive personalized services and exploring new video scheduling and broadcasting methods on that basis. What needs concern was that the healthy development and operation of business models should be based on following business terms, respecting users’ feelings and not violating relevant laws and regulations.
Part of the standard terms, having excluded the main rights of users and failed to fulfill the obligation of giving reasonable reminders, shall be invalid
The court held that the defendant’s “VIP Membership Service Agreement” was standard terms. In particular, the clause that “both parties agree that the foregoing exemption and limitation of liability clauses do not belong to the clauses stated in Article 40 of the Contract Law as ‘exempting one party from liability, aggravating the liability of the other party or excluding the other party from its main rights’, namely, both you and Beijing XX Technology Company recognize the legality and validity of the foregoing clauses, and you will not claim the clauses in the agreement as illegal or invalid on the ground that Beijing XX Technology Company has failed to fulfill its obligation of giving reasonable reminders” violated the compulsory provisions in Article 40 of the Contract Law on the validity of standard terms. Meanwhile, by requiring users to undertake the waiver of their right to claim the standard terms as illegal or invalid on the ground that “the defendant has failed to fulfill its obligation of giving reasonable reminders” through a standard term, the defendant was using the standard term to assume that it had fulfilled its statutory obligation. To sum up, the above standard term shall be invalid.
“Member-specific recommendation” does not constitute a breach of contract
The court held that the “VIP Membership Service Agreement” clearly stipulated the specific content of “advertising privilege” and “member-specific recommendation” and stated that there would still be other forms of advertisements in the preamble of videos; and in the introduction page of benefits of VIP membership, the defendant clearly explained the specific content of “advertising privilege” through description by text and examples in the form of pictures. The advertisements or member-specific recommendations broadcast by the defendant’s platform in films and TV series were consistent with the above stipulations. Thus, the defendant did not breach the contract.
The “paid advance screenings on demand” reduced part of the benefits of “gold VIP membership” that Wu X should enjoy, and thus the unilateral change shall have no effect on Wu
The court held that “you can enjoy watching ahead of schedule, without the need to wait for updates at a snail-like speed. When others are still waiting for updates, you have already watched the finale” should be understood as “all VIP members can enjoy the benefits of watching all updated hit TV series and high-quality self-made dramas of the platform ahead of users who are not VIP members”.
In this case, it was the defendant’s commitment to provide preferential rights to gold VIP members including Wu X. In other words, Wu should be given the preferential right to watch the series ahead of users who were not gold VIP members. Films requiring extra payment or coupons to watch, which were already existing when Wu bought the gold VIP membership, stipulated in the agreement and clearly marked in related films, were in a parallel relationship with hit TV series and the defendant’s high-quality self-made dramas, while the “paid advance screenings on demand” service was reducing a part of the benefits of VIP membership of “watching hit TV series first”.
By launching the “paid advance screenings on demand” service during the broadcasting of the TV series Joy of Life involved in the case based on the unilateral change clause, the defendant’s platform damaged the benefits of gold VIP membership of watching the TV series ahead of schedule. As a result, the watching experience enjoyed by gold VIP members were far lower than expected, making their watching of TV series and films far less entertaining and satisfactory.
Therefore, the defendant can unilaterally change the contract terms based on the characteristics of its network services, but such change should be based on the premise of not damaging the rights and interests of users. The defendant’s unilateral addition of the “paid advance screenings on demand” clause damaged Wu’s main rights and interests, and shall thus not have the effect of changing the contract on Wu.
In the judgment, it was ascertained that the content in the second paragraph of the introduction part of the Service Agreement shall be invalid, the content in Clause 3.5 thereof shall have no effect on the plaintiff, and the defendant shall provide the plaintiff with the original benefits of “gold VIP membership” for 15 consecutive days so that the plaintiff could enjoy the right to watch hit TV series and the defendant’s high-quality self-made dramas that had been updated on the defendant’s platform, and compensate the plaintiff for the loss of notarization fee of RMB 1,500. The defendant refused to accept the judgment of first instance and filed an appeal. The court of second instance dismissed the appeal and upheld the original judgment.
Soft Pornographic Comic Case: Contracts Concluded to Provide Soft Pornographic Content to Minors Shall Be Invalid
—— Wang X v. XX Network Technology Company over Network Service Contract Dispute
It is the common value and goal of the public to strengthen the protection of minors and support their healthy growth. In this case, with the online comics, a common life scene for minors, as the trigger, it is concluded that when the content of online cultural products is unhealthy, network service contracts shall be invalid for the violation of public order and good morals. In the judgment of this case, it is emphasized that network service providers should uphold the core value of integrity and improve the service content in accordance with the laws. Meanwhile, the judgment plays the leading role of justice to guide network service providers, minors and their parents, and all sectors of society to jointly follow the values of civility, kindness and rule of law, act on “caring for the young” in daily life and participate in the ecological governance of network information content, so as to create a healthy, clean and sound cyberspace for the healthy growth of minors.
Wang X, a junior middle school student, paid for comics reading on the comics reading platform operated by the defendant without his parents’ knowledge. In a year and a half, Wang read more than 100 comic books, for which he recharged and paid more than RMB 1,400. After Wang’s parents found out the situation, they communicated with the defendant, clearly expressing that they would not ratify the payment and requiring for a refund. The defendant did not agree to a full refund. The guardians of the plaintiff held that as Wang had limited capacity for performing civil juristic acts, his act of recharging did not match his age and intelligence; and the defendant was clearly at fault, since the comics provided thereby contain nudity, sexual teasing and other content, which were not suitable for minors to read, and the defendant failed to provide identity authentication for minors as well as corresponding functions such as time management, authority management and consumption management. Therefore, the network service contract shall be invalid, and the defendant shall refund the recharged amount of the plaintiff in full.
[Key Points of Adjudication]
First, the criteria for determining whether a minor’s online consumption act matches his/her age, intelligence and mental health status shall be identified after comprehensively considering such factors as the nature of the juristic act involved, the age of the minor, the correlation between the consumption act and his/her life, the amount, frequency and other modes and characteristics of consumption as well as the economic status of the minor’s family and the economic level of the region where the minor lives.
Second, the protection of minors, reflecting the social care for the young, is an important embodiment of the traditional virtues of the Chinese nation and the good morals of the society. Therefore, when judging the validity of the acts of minors, who are a special group, emphasis shall be laid on examining whether the content involved violates public order and good morals. And the judgment of whether the content involved violates public order and good morals shall fully follow the principle of acting in the best interests of minors based on the fact that the subject performing the contract as was identified in this case was a minor.
It was ascertained that the network service contract between Wang X and XX Network Technology Company shall be invalid, and XX Network Technology Company shall refund the recharged amount to Wang X in full.
In-game Item Property Right Case: In-game Items with the Attribute of Property Interests Are Network Virtual Property
—— Cheng X v. XX Technology Company over Property Right Infringement Dispute
The era of big data has bred all kinds of online economic activities, as a result of which there are now various complicated types of network virtual property. In this case, by analogy and recognizing the whole through observation of the part on the basis of defining the legal nature and ownership of virtual property in the field of online games and illustrating the protection boundary thereof, the overall protection scope of network virtual property, identification of infringement thereof, corresponding damage compensation therefor and other related details are further clarified, thereby allowing better play to the social functions of laws, guiding the behaviors of the public and safeguarding the sound development of the digital economy. This case was selected as one of the “Ten Major Judicial Cases of Network Governance of China in 2022”.
Cheng X was a player of a mobile game, and he recharged a total of about RMB 200,000 to the mobile game while playing it. On October 31, 2019, the mobile game operator issued an announcement to terminate the operation of the game and stated that as compensation, it would transfer 5% of the total historical recharge of game players to other games. Later, Cheng filed a lawsuit before the court against the mobile game operator involved, claiming that by terminating the operation of the game, the defendant infringed his legitimate rights and interests, and demanding the refund of the unused in-game currency of over RMB 30,000 and the compensation of over RMB 1 million and associated interest for the game service that failed due to the termination of operation. The defendant argued that it was not at fault to terminate the operation of the online game service and should not bear tort liability. There was no agreement between Cheng and the defendant on the operation period of the game involved, the circumstances of termination and the assumption of liability after termination of operation.
[Key Points of Adjudication]
First, online in-game items, having the attribute of property interests, can be protected as network virtual property in accordance with the laws. An actor, if infringing other people’s network virtual property through fault and causing damage, shall bear tort liability.
Second, the amount of damages to cover the losses of the plaintiff shall be determined based on how online in-game items were obtained. If the in-game items directly purchased with the legal currency were not converted into other in-game items, then the plaintiff did not receive the corresponding service, and the defendant shall compensate for the amount in RMB corresponding to such remaining in-game items; on the contrary, the in-game items having been converted or those obtained while playing the game cannot be directly converted into money even if the operation of the game continues. Since the plaintiff had, while playing the online game involved, received the game service provided by the defendant for a certain period of time and enjoyed the fun of the game, the compensation amount for the loss of the in-game items shall be determined as appropriate based on the total amount recharged by the plaintiff and the period during which the plaintiff played the game.
The defendant shall compensate the plaintiff for the loss of RMB 36,257 and associated interest, and other claims of the plaintiff were dismissed.
0.1-RMB Short Message Unsubscription Case: When the Allocation of Expenses for Performance Is Not Clearly Stipulated, Costs for Users to Unsubscribe from Commercial Promotional Short Messages Should Be Borne by the Platform Company
—— Wang X v. Beijing XX E-commerce Company over Network Service Contract Dispute
Due to the diversity and richness of Internet products and the universality and discrepancies of users, different users may have different expectations for the experience of Internet platform services. In order to meet the needs of different users and improve transaction efficiency, Internet platforms incorporate into the authorization agreement of integrated platforms such personalized and differentiated services as information push on the premise of giving clear notification and reasonable reminder in advance, and then provide effective ways of refusal (cancellation of authorization) according to the needs of different users, which is more in line with the characteristics of such Internet platforms and is conducive to the development of the Internet industry. Through this case, it is clarified that e-commerce platforms can provide personalized short message push service for users as per contract terms, but should provide effective ways of refusal or cancellation of subscription at the same time, and the costs of short messages for cancellation of subscription should be borne by e-commerce platforms. The case helps to further elaborate the circumstances and rules to which “where the allocation of expenses for performance is not clearly stipulated” of Article 511 of the Civil Code shall apply, which is of exemplary significance. The case was selected as one of the Annual Cases of Courts in China in 2021, one of the Study of China’s Outstanding Court Cases in 2021, one of the “Ten Major Typical Judicial Cases of Consumer Rights Protection of China” of the China Consumers Association in 2019-2020, and one of the Typical Civil Cases Involving People’s Livelihood of Beijing courts in 2022.
At 10:03 on November 1, 2019, the defendant Beijing XX E-commerce Company sent a short message to Wang’s mobile phone number “150****9657”, which read: “[Beijing XX E-commerce Company] The red packet to get an RMB 20 discount for your pay at or over RMB 69 that you applied for has been issued! Buy in advance for the Double Eleven: Enjoy <an RMB 50 discount for your pay at or over 99 RMB> for all hotpot products, and buy sliced fatty beef for RMB 9.9 only. dwz.cn/ly99v1nx. To unsubscribe, send ‘N’ to us”. At 10:13 on November 11, 2019, Beijing XX E-commerce Company sent another short message to Wang, which read: “[Beijing XX E-commerce Company] The goods for your Double Eleven shopping are ready! Buy 250g of cherries for RMB 29.9, and enjoy an RMB 200 discount for your pay at or over RMB 299 for the products of Three Squirrels! Red packets requiring no threshold for consumption are available too! dwz.cn/6fXeyLEO. To unsubscribe, send ‘N’ to us”. Then at 10:01 on November 15, 2019, Beijing XX E-commerce Company sent yet another short message to Wang, which read: “[Beijing XX E-commerce Company] Your application has succeeded: as the Fresh Food Festival starts, a red packet of RMB 100 in value has been credited to your account! Buy cherries for RMB 29.9, and choose any 5 bags of snacks for RMB 49. dwz.cn/MYuphBXo. To unsubscribe, send ‘N’ to us.”
At 16:31 on November 10, 2019, at 20:54 on November 15, 2019, and at 20:54 on November 15, 2019, the plaintiff Wang replied “N” to the three numbers of Beijing XX E-Commerce Company that sent short messages to him, respectively “10690738504514”, “10691852965574” and “1069285314192104”, in which the cost of RMB 0.1 arose for the short message replied to the number “10691852965574”.
[Key Points of Adjudication]
Breach of contract refers to the act of parties that violates their contractual obligations. Specifically, it is the act of one party to a contract that “fails to perform its contractual obligations” or “fails to comply with the contract when performing its contractual obligations” as stipulated in this article.
In the judgment, it was ascertained that the cost of unsubscribing from commercial short messages was “the expense for performance arising from the platform’s performance of its obligation to provide users with short message notification service that can be unsubscribed from”, and the platform company was the party performing the obligation. When the allocation of expenses for performance was not clearly stipulated, the cost for the user to unsubscribe from commercial promotional short messages should be borne by the platform company.
Neither party appealed after the judgment of first instance was made, and the judgment has come into force.
Encyclopedia Entry Case: The Failure of Online Encyclopedia Service Providers to Properly Review Entry Editing Constitutes Infringement
—— Zhao X v. Beijing XX Technology Company over Right to Reputation Infringement Dispute
Online encyclopedia products have gradually become the information channel that the whole society attaches importance to and relies on, and have the attribute of social public interest. For the creation and editing of encyclopedia entries, especially entries of famous figures, online encyclopedia service providers should not only strengthen review to avoid deliberate discrediting and defaming of the figures in the entries which infringes their personality rights, but also pursue the completeness and accuracy of the content as far as possible to avoid wrong understanding of the figures by the public.
The defendant is the provider of an online encyclopedia service. A user edited the encyclopedia entry of Zhao X, the plaintiff’s father, twice, deleting the opera script “Red Coral” from Zhao’s masterpieces and adding the words “Zhao X was a big literary thief”. Believing that the defendant’s act infringed his father’s reputation, the plaintiff filed a lawsuit, requesting the court to order the defendant to compensate the plaintiff for the mental distress of RMB 6, disclose the true identity of the user, amend or cancel the exemption clause in the user agreement, make an apology, eliminate the adverse effects and restore the original entry.
[Key Points of Adjudication]
Does the plaintiff have the right to file a lawsuit?
The laws and judicial interpretations in China clearly give the close relatives of a deceased the right to file a lawsuit over the infringement of the right to reputation. Meanwhile, negative social appraisal of a deceased not only infringes the reputation of the deceased, but also affects the overall interests and personal interests of the close relatives thereof. Therefore, any close relative of the deceased has the right to request the court to protect the personality rights of the deceased, and to hold others accountable for infringing his/her own personality rights based on his/her status as the close relative of the deceased at the same time.
Was the reputation of the plaintiff’s father damaged?
An encyclopedia platform is an open platform to provide information for Internet users based on the content of entries created and edited by platform users. Internet users can learn about the life and masterpieces of Zhao X, the plaintiff’s father, and form an objective appraisal of Zhao X through this entry. There is existing evidence to confirm that Zhao X was one of the authors of the Red Coral.
A user deleted the Red Coral from the content of the entry involved. Although not directly giving remarks denying Zhao, the user’s act of covering up facts would affect Internet users’ true and comprehensive understanding of Zhao’s life and masterpieces and objective appraisal of Zhao, leading to lower social opinion on Zhao. The derogatory and insulting remarks added by the user to the “Introduction” part of the entry involved were learnt by Internet users and were retained for 5 years, seriously damaging Zhao’s reputation.
Did the encyclopedia platform company commit infringement, and what kind of civil liability should it bear?
(1) The encyclopedia platform company committed infringement
Whether the defendant committed infringement should be analyzed from the perspective of information disclosure and review obligations of network service providers. In this case, the defendant has disclosed the registration information of the user to the court. At that time, China did not require Internet information service providers to carry out real-name authentication upon registration of network users. Therefore, the defendant was not at fault for failing to provide real-name information.
(2) The encyclopedia platform company shall bear civil tort liability
The civil liability to be borne by the encyclopedia platform company should be determined by examining whether the defendant knew or should know about the infringing act.
From the perspective of the defendant’s information management ability, the nature and way of providing services and the possibility of causing infringement, the defendant provides users with information storage, access and modification services, has the information management ability, and has infringement risks when providing services. Accordingly, the defendant should have the awareness of preventing infringement risks and should take necessary and reasonable measures to regulate the risks according to its ability.
From the perspective of the technical possibility for the defendant to take measures to prevent infringement and of whether it took corresponding reasonable measures: during the lawsuit of this case, the defendant did not provide the court with the user agreement applicable when the entry involved in the case was edited. However, it should have the awareness and the ability to well keep its previous editions of the user agreement, and should also bear the adverse consequences of failing to provide evidence. Even a comparison with the notarized XX Encyclopedia Agreement dated July 2015 cannot show that the defendant had taken reasonable measures to prevent infringement: first, the defendant argued that the entry involved in the case did not need review and approval when it was edited by the user involved but could not provide the editing rules prevailing at that time, so it should bear the adverse consequences of failing to prove evidence. Second, according to the analysis of risks existing in entry editing as well as the awareness of prevention and management ability that the defendant should have, the defendant should review whether the edited content of the entry infringed personality rights such as the right to reputation. But the defendant did not take effective measures to prevent and control improper editing acts. Failing to perform its management obligations as the network service provider, the defendant shall bear civil tort liability to the plaintiff.
The defendant shall make an apology to the plaintiff and compensate the latter for mental distress of RMB 6.
Case of Minor Opening Online Store: Minors Shall Have Corresponding Capacity for Performing Civil Juristic Acts to Open Stores and Sell Goods on Platforms
—— Xu XX et al. v. Su X and XX Technology Company over Information Network Sales Contract Dispute
It is increasingly common for minors, the “digital natives”, to participate in Internet transactions as consumers, and the relevant laws and regulations have been relatively well established. However, the acts of minors opening stores and selling goods on platforms cannot be ignored. This case has fully embodied the extension of the court’s trial function in the process of handling juvenile Internet-related cases. The court not only actively promoted settlement to safeguard the legitimate rights and interests of minors, but also sent judicial suggestions to the e-commerce platform operator on its lack of mechanism and management loopholes in the protection of minors discovered during the trial process, in order to resolve disputes from the source and strengthen the assumption of main responsibilities by the platform, thereby guiding the healthy, stable and sustainable development of the Internet industry and promoting the healthy development of the digital economy.
The defendant Su X, as a minor, opened a store on the e-commerce platform operated by XX Technology Company. Su sold customized photo albums of stars to dozens of people including the plaintiffs, and made virtual delivery of goods on the platform. A few months later, the defendant delivered the physical goods. After receiving the goods, the plaintiffs found a serious mismatch between the goods and the description and the sample. The plaintiffs held that the defendant, selling products inconsistent with the publicity, should bear liability in accordance with the laws, and that the e-commerce platform, as the operator of the platform, should examine and supervise the qualifications of sellers but failed to fulfill its duty. Dozens of plaintiffs filed a lawsuit, requesting the court to order the defendant Su X to refund the purchase price and XX Technology Company to bear joint and several liability for compensation.
The court found through trial that the defendant in this case was a minor, and his act of opening a store on the e-commerce platform to sell goods did not match his identity, age and economic situation. During the trial of this case, the parties reached a settlement under the auspices of the court, with the defendant Su agreeing to refund the plaintiff’s purchase prices. After the case was concluded, the court sent judicial suggestions to the defendant XX Technology Company operating the e-commerce platform on the problems discovered during the trial, especially pointing out its problems in reviewing, and providing reminders on, the opening of online stores by minors. The company replied that it would strengthen the review and supervision of minors as platform merchants who have reached the age of 16, improve the daily supervision work, and further improve the functions of giving reminders on and confirming goods delivery.
Health Consultation Service Platform Case: Impersonating a Doctor to Provide Online Health Consultation Constitutes Infringement
——Li XX v. Beijing XX Technology Company and Hangzhou XX Technology Company over Infringement of Right to Reputation and Right to Name
Through this case, the ways and methods of adjudication on the protection of personality rights of doctors in Internet health consultation services are clarified, which plays a positive role in strengthening the self-discipline and management, and improving the quality and level, of Internet health consultation services, and can serve as a reference for the trial of such cases in the future.
The plaintiff claimed that he found that there were lots of health-related answers provided in his name on a health consultation service platform, including some contents that were obviously beyond the scope of reply in normal medical consultation which the plaintiff would never give from the perspective of both medical ethics and professionalism. In addition, there were also answers hinting at obscenity and pornography provided in the name of the plaintiff or others on the platform. The plaintiff held that the platform’s using his name to answer questions on the platform would impair the public’s opinion on him and affect the trust of patients in doctors, which seriously infringed the plaintiff’s right to reputation and right to name.
[Key Points of Adjudication]
The court tried the case and held that the platform involved impersonated the plaintiff by using his name, photo and professional title in his hospital to publish answers to health consultation questions on the website without the plaintiff’s authorization or consent, which would easily lead the unspecified public to wrongly think that the plaintiff was the one providing consultation service; and that the obvious existence of contents beyond the scope of the plaintiff’s expertise in diagnosis and treatment in the health consultation service and the existence of answers hinting at obscenity and pornography could easily made the public question the plaintiff’s expertise and professional ethics, resulting in negative effect on the plaintiff’s morality and reputation. Therefore, the platform involved committed infringement of the right to reputation and right to name.
The court ruled that the defendant shall make an apology and compensate the plaintiff for mental distress.
Ride-hailing Platform Case: Ride-hailing Platforms Failing to Conduct Management as per Rules Shall Be Liable for Breach of Contract
—— Yang XX v. XX Technology Company over Network Service Contract Dispute
Ride-hailing platforms can identify violating acts of drivers and take reasonable restrictions as per platform rules, and their efficient handling of passenger complaints for the purpose of ensuring safety is worthy of recognition. However, when drivers appeal, the platforms should conduct investigation. If the appealed content is true, the restrictions should be lifted in time to effectively safeguard the legitimate rights and interests of the drivers. The judgment of this case has made it clear that in managing their platforms, ride-hailing platform operators shall pay attention to balancing the interests of the unspecific passengers and the interests of the driver groups, so as to promote the healthy and sustainable development of the ride-hailing business model.
The plaintiff was a registered driver on a ride-hailing app of the defendant. On November 5, 2018, the plaintiff picked up a drunk passenger through the app. As the passenger was still not sober when they arrived at the destination, the plaintiff called the police, and the passenger left on his own after the police arrived. In this process, the plaintiff did not act improperly. Later, the passenger made a complaint to the platform. Given the situation complained by the passenger, the defendant identified the incident as a safety incident based on its experience. On the evening of November 6, the plaintiff was restricted from using the “late-night service card” function and could not take orders at night. After that, the plaintiff made several appeals and submitted the record of calling the police and screenshots of the order, which did not get handled by the defendant. On November 8, the defendant resumed the qualification of the plaintiff to use the “late-night service card” function, but at the same time set a one-month observation period for his account without informing the plaintiff, due to which the plaintiff still could not take orders at night. During this period, the defendant did not further verify the situation appealed by the plaintiff. On December 13, the “late-night service card” function was resumed for the plaintiff. The plaintiff believed that the defendant should compensate him for the loss of turnover of RMB 16,000 because it failed to check the malicious complaint of the passenger in time and limited his use of the “late-night service card” function. The defendant argued that it was exercising its right of autonomous governance of the platform to ensure the safety of passengers by suspending the plaintiff’s use of the “late-night service card” function and setting the observation period, and that the plaintiff’s income did not decrease due to the defendant’s management act.
[Key Points of Adjudication]
Legal relations between the two parties and the attribute of the Platform User Rules
An e-commerce platform is a platform for enterprises or individuals to negotiate online transactions. XX Technology Company provides drivers and passengers with online business operation premises, transaction matching, information release and other services through the ride-hailing platform to enable them to carry out transaction activities, which makes the company an e-commerce platform operator. Yang XX registered himself as a car owner on the ride-hailing platform, thereby becoming a merchant on the platform and forming a contractual relationship with XX Technology Company under the network service contract. As it was impossible to carry out the traditional “face-to-face” contract conclusion given the huge group of users of XX Technology Company, the platform operator required the user to agree to the standard terms formulated thereby to save the time cost and transaction cost of both the platform and the user. The terms in the agreement, if not violating any legal provisions on the validity of contracts, shall be deemed as valid and legally binding on both parties. Since both parties had no objection to the Platform User Rules involved in the case, they should enjoy contractual rights and perform contractual obligations in accordance with the stipulations in the Rules.
Does XX Technology Company have the right to take restrictions against Yang, and do the measures conform to the Platform User Rules?
As the operator and manager of the e-commerce platform, XX Technology Company should guard against possible dangers of network-related acts and have certain obligations to safeguard the personal and property safety of passengers. According to the Platform User Rules, if a user violates the rules, XX Technology Company has the right to hold the user accountable for violation through the measures stated in the rules. Accordingly, XX Technology Company has the right to unilaterally identify violating acts of users based on the above safeguarding obligation, and hold users accountable for violation through the measures stated in the rules. Therefore, after receipt of the complaint from the passenger, considering that drunkenness was a high-risk scene, XX Technology Company initially determined that the driver had violated the platform rules and management requirements and thus restricted the driver’s use of the “late-night service card” function, which meets the requirement of safeguarding the interests of unspecified passengers in society. However, when Yang made several appeals by providing the record of calling the police and the order information involved, XX Technology Company failed to comply with the stipulations on re-checking facts as were stated in the platform rules and took restrictions against Yang for one month when Yang was actually not at fault. As can be seen from the police video, the plaintiff in this case did not have any misconduct. Therefore, the measure taken by XX Technology Company lacked reasonable and sufficient basis, and the failure thereof to comply with the Platform User Rules constituted a breach of contract.
As the operator of the e-commerce platform, XX Technology Company is the bond connecting all parties. To ensure the personal and property safety of passengers without damaging the legitimate rights of drivers at the same time, it should reasonably balance the rights and interests of drivers, passengers and the platform, which would be the solution to enable long-term operation and development. It is worthy of recognition that XX Technology Company takes the principles of safety and efficiency as the basis for the platform operation, but in implementing the platform rules, it should also consider the specific circumstances of each case to make judgment based on facts, and should not arbitrarily restrict the normal operation of drivers on the grounds of the platform rules.
Should XX Technology Company bear civil liability to compensate for the loss?
As XX Technology Company’s failure to abide by the Platform User Rules constituted a breach of contract, it shall bear the liability for breach of contract to compensate for the loss. Regarding the loss claimed by Yang, the court decided as appropriate that XX Technology Company shall compensate Yang for the loss of RMB 4,000 based on the difference of his daily income before and after the restriction of the “late-night service card” function and considering the oil costs and other expenses at the same time.
The court ruled that the defendant shall compensate the plaintiff for the loss of RMB 4,000.
Member Mutual Aid Platform Case: Upon the Updates of Rules, Mutual Aid Platforms Shall Equally Protect the Legitimate Rights and Interests of Members Who Joined the Platform Before the Updates
—— Yan X v. XX Company over Network Service Contract Dispute
The digital economy has led to the emergence of online mutual aid platforms. In order to allow the online mutual aid business to truly help supplement the development of China’s multi-level medical security system and effectively safeguard the legitimate rights and interests of the members who lack the professional knowledge of risk coverage and the operation experience in group organizations, mutual aid platforms as the rule maker shall, while updating their rules, avoid exempting or mitigating their own responsibilities, aggravating the responsibilities of platform users or limiting their main rights through relevant modifications, and shall pay attention to the equal protection of the legitimate rights and interests of members who joined the platform before the rules are modified. The adjudication of this case helps provide guidelines on determining whether the formulation, update and modification of rules by platforms are reasonable and well founded and promote platforms to fully consider the impact of clause changes on users and formulate solutions in advance, thereby effectively safeguarding the vital interests of platform users.
The plaintiff Yan X filed a lawsuit, claiming that in 2016 she joined the “Critical Illness Mutual-aid Plan” launched by the defendant’s mutual aid platform for a financial aid of up to RMB 300,000. After joining the plan, the mutual aid platform kept deducting money from Yan’s account, totaling over RMB 400. In 2019, Yan was diagnosed with cancer. After receiving surgical treatment in hospital, she was refused payment when applying for aid from the platform. The platform claimed that as the rules had been revised, Yan did not meet the conditions for aid because she had already suffered from hypertension when she joined the Plan. Therefore, Yan filed a lawsuit to the court.
[Key Points of Adjudication]
What criteria should be used to determine whether Yan met the conditions for joining the Plan?
When Yan joined the mutual aid platform in October 2016, the rules that applied were the platform’s Articles of Association (2016 Edition), which did not explicitly stipulate that one suffering from hypertension was not healthy. However, the mutual aid platform refused Yan’s request based on the stipulations of the Articles of Association (2018 Edition), which, after the more detailed modifications to the circumstances not meeting conditions for joining, would inevitably affect the rights and interests of members who joined before, yet the mutual aid platform did not provide old users with channels for reconfirmation and treatment solutions. Under such circumstance, meeting the conditions for joining the platform or not should be evaluated against the Articles of Association applicable when members joined the platform, but not against the revised conditions. Otherwise, the following situation may occur, i.e., a member who met the conditions at the time of joining and had fulfilled the obligation of amount sharing and mutual aid as per the Articles of Association would get unaided when he/she no longer met the conditions for joining because of the modifications to the Articles of Association, thereby suffering the loss of his/her shared amount and possibly losing other opportunities for mutual aid.
Did Yan meet the conditions for joining the plan?
According to the Articles of Association (2016 Edition), “When joining the plan, you should be in good health, without any physical dysfunction or mental disorder, or any loss or transplantation of functional organs and limbs, or any critical diseases and specific diseases listed in the Plan; without any surgery or hospitalization due to illness or any continuous or repeated medication due to one same disease within one year before joining; and without any symptoms or signs of prolonged recurrent or progressive attacks within six months before joining”. This clause did not expressly stipulate that hypertension was a circumstance that should be excluded. Meanwhile, the diseases listed in this clause were obviously more serious than hypertension suffered by Yan. Thus, it was in line with the usual cognition that Yan thought her physical condition met the conditions for joining. Therefore, since the Articles of Association (2016 Edition) did not expressly exclude the disease suffered by Yan and her illness was obviously lighter than the diseases listed therein, due to which Yan could not realize that her illness was a circumstance not meeting the conditions for joining, it should be considered that Yan met the conditions for joining.
The court held that whether Yan met the conditions for applying for aid shall be determined based on the rules of the Articles of Association applicable when Yan joined the platform rather than the modified rules. This practice of raising the threshold of receiving aid by amending the platform rules affected the legitimate rights and interests of platform members joining before the rules are modified. Finally, it was determined that Yan met the conditions for applying for the financial aid.
The court ruled that the mutual aid platform shall initiate a mutual aid plan for the plaintiff Yan X and pay the collected mutual aid fund of RMB 300,000 to Yan.
Hotel Booking Case: Platform Operators Failing to Clearly Indicate Merchants on Platforms Shall Bear the Corresponding Liabilities
—— Yang X v. Beijing XX Information Technology Company over Network Service Contract Dispute
The judgment of this case has made it clear that the operators of e-commerce platforms should distinguish the self-operated business from the business operated by merchants on the platforms in a notable way and may not mislead consumers; and that e-commerce platforms not clearly indicating the operator of the hotel booking business involved should assume the legal responsibility of the business operator.
The plaintiff booked 2 rooms for 4 nights in a hotel in Sanya through the mobile phone client operated by the defendant, for a total lodging cost of RMB 464. The plaintiff immediately paid the lodging cost, and then the defendant’s platform sent a confirmation message to the plaintiff. At the same time, the mobile phone client of the defendant’s platform also prompted that the booking was successful. On the same day, the customer service worker of the defendant’s platform informed the plaintiff by phone that the merchant called to say that as all rooms had been booked, it could not arrange the check-in and hoped to negotiate with the plaintiff to cancel the order. Later, the two parties reached an agreement: the plaintiff could stay in another hotel in Sanya based on the original time of check-in and check-out, and the defendant would compensate the plaintiff for the actual price difference which shall not be higher than RMB 764 against the invoice and bill issued by the new hotel, so the plaintiff agreed to cancel the order. The plaintiff claimed that booking the same hotel according to the plan of the original order would cost a total of RMB 3,024 for the lodging cost, and thus the price difference of RMB 2,560 from the original order should be paid by the defendant in compensation. Therefore, the plaintiff filed a lawsuit, requesting the Beijing Internet Court to order the defendant to compensate the plaintiff for RMB 2,560.
[Key Points of Adjudication]
Did Beijing XX Information Technology Company commit a breach of contract?
Operators of e-commerce platforms should distinguish the self-operated business from the business operated by merchants on the platforms in a notable way and may not mislead consumers. In this case, Beijing XX Information Technology Company did not produce evidence to prove that it fulfilled its obligation of distinguishing different types of business in a notable way in the booking process; only after the booking was successful it was mentioned in the confirmation message sent by the website operated thereby that “the service will be provided by XXX”, but the message did not indicate the real name of the merchant on the platform, which was not enough for Yang to understand its exact meaning and to determine whether the business was operated by the platform itself or by a third party. Therefore, Beijing XX Information Technology Company should assume the legal responsibility of the service provider. Its failure to fulfill its obligation as the service provider constituted a breach of contract.
Was the cancellation of the order caused by the merchant on the platform?
In the booking process, Beijing XX Information Technology Company was not sure whether Yang’s order was confirmed by the hotel and did not produce evidence to prove that the order was actually confirmed by the hotel, but it still sent Yang a message saying the booking was successful. During the cancellation of the order, there had been no indication of intention expressed by the hotel since the beginning, and there was no evidence to prove that the request to cancel the order was made by the hotel, which undoubtedly put Yang in a huge consumption risk. The court thus did not admit the defense opinion of Beijing XX Information Technology Company that the cancellation of the order was caused by the merchant.
Regarding the determination of the compensation amount
From the statement of the parties and the recording of the phone call provided by the defendant, it can be confirmed that the defendant had provided Yang with a compensation plan before canceling the order, and Yang explicitly accepted the compensation plan and agreed to cancel the order. Therefore, the two parties had reached an agreement on the compensation for breach of contract, which should be observed. In other words, after Yang provided the bill and invoice to the defendant, the defendant would compensate Yang for the actual price difference, which should not be higher than RMB 764. Yang objected to the authenticity of the recording of the phone call, and thus not recognizing that the two parties had reached the compensation agreement. But as no corresponding evidence was provided, such objective was not admitted by the court. Therefore, the court did not support the part of Yang’s claim for compensation amount that exceeded the amount agreed in the above agreement.
The court ruled that the defendant shall compensate Yang X for the actual price difference, which shall not be higher than RMB 764.