A Stitch in Haste

OpinionJournal has a fluff piece profiling the online matchmaking service eHarmony:

[CEO Greg Waldorf] now estimates revenue to approach $200 million for 2007, with business to be "gangbusters" through Valentine's Day. The company boasts 14 million registrants since its founding. Perhaps most important, at a time when there seems to be great cynicism about marriage, Mr. Waldorf is confident that Americans still place a high premium on lasting commitment. Just look at the economics.

"I'm very respectful of people who pull out their credit card to pay for our service," he says. "I think they're getting a good opportunity to meet the right person, but this is real money. This could be the same cost as your cellphone plan, and I'm not trying to equate cellphone plans with finding a soulmate, but it's real money to people." Why are they willing to pay so much? Because "people associate the highest value with long-term relationships."

Perhaps I'm a victim of pre-dot-com thinking, but I'm guessing that $200 million is a very aggressive estimate [the article does not provide historical results]. eHarmony is a distant fourth in the online personals market.

In any case, I think it's fascinating that a company can claim to be so "respecting" of its customer base while in fact being one of the most bigoted companies in cyberspace:

[Founder Neil Clark Warren] really does want to set you up — but only if you're emotionally healthy, heterosexual and want to get married.

A psychologist with a divinity degree, Warren has emerged from the Christian community — three of his 10 books on love and dating were published by conservative Focus on the Family — to become one of the Internet's most unlikely entrepreneurs.
...
The connection may come as a surprise to today's mainstream users: Nothing in Warren's TV or radio ads ($50 million spent last year, $80 million projected this year) hints at his Christian background.

And while it's no secret, the Web site doesn't play it up, either.

This constitutes "respecting your customers"?

Of course, private businesses do (or at least should) have the right to discriminate as they see fit. It is, after all, a "free" market.

But don't trumpet a firm that so flagrantly discriminates as a capitalist "success story." True capitalists, pure capitalists, don't base, or even constrain, their business practices based on bigotry. True capitalists, pure capitalists, are too busy making money to be distracted by archaic bigotry. True capitalists, pure capitalists, have ideals that are too far "beneath" the lofty aspirations of "enlightened Christians" like Neil Clark Warren. True capitalists, pure capitalists, are the legitimate "reality-based community," and as such are focused on life on this earth and not on trying to earn (buy?) their way into heaven.

Bottom-line: eHarmony may be an interesting case study, but precisely because it is not true capitalism, not pure capitalism.

Back in February, I wrote the following regarding eHarmony's bigoted policy excluding gays:

Of course, private businesses do (or at least should) have the right to discriminate as they see fit. It is, after all, a "free" market.

Now that eHarmony is being sued for sexual orientation discrimination, like-minded folk are saying pretty much the same thing. And that's fine.

Just one pesky detail: The lawsuit was filed in California, apparently under that state's over-reaching Unruh Civil Rights Act:

51.5. No business establishment of any kind whatsoever shall discriminate against, boycott or blacklist, or refuse to buy from, contract with, sell to, or trade with any person in this state on account of any characteristic listed or defined[.]

California's Civil Rights Act of 2005 added sexual orientation to the list of protected classes.

So, as I tried to explain in this post about another widely lambasted Unruh lawsuit, it is all-important to distinguish between insisting that the eHarmony litigation is "silly," "misguided," "petty" or any similar word (which may well be the case), and claiming that it is "frivolous" (which is simply not the case). Under the plain language of California law, this is obviously not a frivolous lawsuit. If anything, it is the Unruh Act that is frivolous.

That's the first part of the analysis; here's the second part:

Whoever denies, aids or incites a denial, or makes any discrimination or distinction ... is liable for each and every offense for the actual damages ... up to a maximum of three times the amount of actual damage but in no case less than four thousand dollars[.]

Under normal circumstances, a gay excluded from eHarmony would, at best, be entitled to actual damages — which would be what exactly? A pat on the back and some Kleenex?

But this is California, which has announced to the whole world: "Come to California, find any incident of discrimination, no matter how minuscule or inconsequential, and you win at least $4,000!"

With that kind of incentive system, of course men are going to sue bars for having (discriminatory) "Ladies Nights" — $4,000 of ka-ching! (per plaintiff!). Of course someone is going to sue the California Angels for a (discriminatory) Mother's Day giveaway — $4,000 of ka-ching! (per plaintiff!). And of course some inventive gay is going to figure out that eHarmony can be sued under Unruh — $4,000 of ka-ching! I'm mad that I didn't think of it myself! (Note also that the eHarmony lawsuit is seeking class action status — $4,000 x how-many + punitives = mega-ching!

Incidentally:

...four thousand dollars, and any attorney's fees that may be determined by the court in addition thereto...

Is it any wonder that there are California law firms that specialize exclusively in representing Unruh plaintiffs?

It's quite simple really: When the government subsidizes something, you get more of it. The State of California has enabled and actively encourages people to sue for the smallest incidents of discrimination, even when there are no real damages.

Be indignant over the eHarmony lawsuit all you want. But don't be surprised by it, and don't damn the plaintiff for doing exactly what the State of California has relentlessly encouraged her to do.

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Note that nothing in this post should be construed as revising my position regarding adding sexual orientation to already existing anti-discrimination laws such as ENDA and the federal hate crimes law. I continue to posit that it is perfectly consistent with libertarian principles to insist that, if you are going to have, as a fait accompli, protected classes such as race, gender and disability, then that list of protected classes should be rationally and fairly compiled — and that requires that sexual orientation be included. Even if "one level of protection for all" is the asymptotic libertarian ideal, it is nevertheless also a libertarian ideal to support going from three levels of protection to two (i.e., by adding gays to the protected class). That is not a step backwards.

More thoughts at no third solution, Hit & Run, Howling Point, PHB.