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Livedrive May Face Court for Closing Accounts Without Warning

The Guardian has learnt that Livedrive has shut down hundreds of UK accounts with little warning to their users. The company will now potentially face legal action from disgruntled customers who claim that they’ve been unfairly punished and have lost their data.

Livedrive is a cloud service that is owned by J2 Global, a company that provides a number of different internet services. The company is certainly performing well – the second quarter of 2014 saw the parent firm report pre-tax profits of $63.7m and total revenues of $144.7m. Their online backup business, of which Livedrive is included, is nearly earning $60m in annual revenue.

However, the company have recently closed some user’s accounts due to what John Eikenberry, Livedrive’s UK chief operating officer, said was for “excessive bandwidth/storage” use. However, he refused to define publically what exactly “excessive” use was.

Two customers that the Guardian had contact with include Paul Parkinson and Amar Patel. Parkinson had his lawyers contact the company to warn them against closing his account, but it fell on deaf ears. Patel, who runs a photography company, is considering legal action after he lost family photos when his account was deleted.

Another user, Andy Sharp, complained that he was unable to actually reach a human in customer support as their telephone lines were extremely busy. Sharp received an initial email to warn him of his excessive use; when he replied for clarification, he was assured that nothing would change in his account without further warning. However, his account was later closed without a word from Livedrive.

“I’m not 100% satisfied with how the communication unfolded following the identification of the accounts,” said Eikenberry. “We only needed to close a very small percentage of users due to misuse.”

Some users told the Guardian that they haven’t changed their use of the service, but they’ve still had their accounts closed. One example email gave a 30 day notice of account termination and that the breach “occurred during the tenure of your account ownership rather than an individual event or action.”

Patel even contacted Livedrive before signing up to specifically check whether his usage would be appropriate. He spoke to the sales team who told him that there was no limitation to be aware of and that the company’s infrastructure would be able to handle his uploads without a problem. However, his account was later closed and his data deleted.

The story raises questions about cloud services who claim their services offer ‘unlimited’ use. This could be unlimited storage or unlimited bandwidth; whatever the case, sometimes there is actually a limit. Perhaps it is written deep within the terms of conditions, but it still reeks of false advertising.

“We are satisfied that the actions which we were obliged to take in this instance were carried out in accordance with the terms of our agreement with these customers,” said Eikenberry.

Some of the users who had their accounts closed are now considering legal action, although Eikenberry’s comments suggest that the company believe they acted suitably and legally.

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