|The Inside Scoop|
Loose Language: How One Bad Apple Can Sour Your Self-Storage Business
A guest installment by Tony Jones, Manager, Inside Self-Storage Store
I remember vividly my elementary-school teachers explaining to me and my classmates how the actions of “one bad apple” could ruin things for an entire class. We scoffed, of course, until we all missed recess or, ahem, several of us were detained after school, sentenced to clean chalkboards or write standards (“I will not participate in or instigate a book drop again.”) because one kid or a group of us did something dumb enough to challenge the teacher’s authority even after being warned.
As one grows older and moves through grade levels and into business, the “one bad apple” effect remains, only there isn’t usually any forewarning about what might happen, and the consequences tend to carry much more risk. One’s livelihood is not to be trifled with, and yet, in the self-storage industry, operators still like to give away a “free truck with move-in” and boast how their facilities are “secure” and “climate-controlled.”
Attorney Jeffrey Greenberger, a partner with the law firm Katz, Greenberger & Norton LLP, has talked and written extensively about how some seemingly innocuous marketing terms and phrases can unnecessarily put self-storage facilities at risk of being sued by customers who claim they were duped or misled by the language used in advertising or a rental agreement. He once wrote an entire article on the legal implications of “free.”
Terms like “free” or “secure” may seem innocent, but all it takes is one bad apple—a disgruntled customer with an ax to grind—to cause major headaches for a facility operator. Our litigious society suggests that a customer whose unit broken into almost certainly will consider the possibilities of suing the company if features like “secure facility,” “24-hour surveillance,” etc., were used to garner the customer’s business. Such advertising could be used against the facility in court as an example of failing to deliver on promises or fulfill a contract.
At the most recent Inside Self-Storage World Expo, Greenberger conducted two sessions that touched on aspects of this topic. Available for video purchase in the ISS Store, one discusses common types of lawsuits and actions brought against storage operators; the other focuses on 13 commonly used terms that should be avoided as part of a self-storage operation.
If you don’t think the potential for a lawsuit is serious, please consider the federal case this week in which the U.S. 9th Circuit Court of Appeals ruled that California retailers can be sued by customers over false advertising. “When a consumer purchases merchandise on the basis of false price information, and when the consumer alleges that he would not have made the purchase but for the misrepresentation, he has standing to sue,” wrote Judge Stephen Reinhardt.
The case involves Kohl’s department store and a single customer who claims he would not have made several purchases had he known the prices in an advertisement were not the actual markdowns. Kohl’s, of course, denies its ads were false or misleading. While a department store is not a self-storage facility, it doesn’t take much to read the judge’s opinion, substituting a few words here and there to apply to a storage rental agreement or “misrepresentation” of a facility discount offer or poorly worded marketing feature.
With the economy getting stronger, now is not the time to take a marketing misstep and put your business at risk unnecessarily. You just don’t know how a court will interpret gray areas of language. The Kohl’s lawsuit was originally intended as a class-action case but was dismissed by a lower court. The higher court saw validity in the customer’s claim.
Educate yourself, communicate with your peers, and consult with your attorney about the language you use in your rental agreement and marketing messages. Other resources at your fingertips include the Legal topics page of this website and your state or national self-storage association. Be sure to also peruse the legal forum of Self-Storage Talk, the storage industry’s largest and most active online community, for current discussions and to connect with fellow operators.
Don’t let a disgruntled customer put your business in jeopardy. Take the time to protect against one bad apple and enjoy all the fruits of your labor.
Have you ever regretted using a marketing phrase or a specific term in a rental agreement? What did you learn about the experience and how would you advise other operators to avoid similar errors? Please share your experiences in the comment section below.
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