Court Of Appeal Advises Online MerchantsTo Include Conspicuous Textual Notice With Terms Of Use.
Consumers may be bound by arbitration provisions in internet “clickwrap” or “browsewrap” agreements – except when they are not – as was the case in Long v. Provide Commerce, Inc., B257910 (2/3 March 17, 2016) (Jones, J.).
Internet contracts “come primarily in two flavors: ‘clickwrap’ (or ‘click-through’) agreements, in which website users are required to click on an ‘I agree’ box after being presented with a list of terms and conditions of use; and ‘browsewrap’ agreements, where a website’s terms and conditions of use are generally posted on the website via a hyperlink at the bottom of the screen,” quoting from Nguyen v. Barnes & Noble, Inc., 763 F.3d 1171 (9th Cir. 2014). The Second District panel informs us, “[N]o California appellate court has yet addressed what sort of website design elements would be necessary or sufficient to deem a browsewrap agreement valid in the absence of actual notice.”
Nguyen, which I previously posted about on August 18, 2014, explained, “the defining feature of browsewrap agreements is that the user can continue to use the website or its services without visiting the page hosting the browsewrap agreement or even knowing that such a webpage exists.” The determination of the validity of the browsewrap agreement turns on whether the user has actual or constructive knowledge of a website’s terms and conditions – and that, in turn, depends on how conspicuous the terms and conditions are.
The Ninth Circuit in Nguyen, and now the California Court of Appeal in Long, agreed that the browsewrap agreement at issue was not enforceable. In Long, the hyperlink to terms of use appeared at the bottom of pages, in a light green typeface on a lime green background, and was situated among many other hyperlinks of the same color, font, and size. Clicking on the hyperlink would have led to the Terms of Use, and proceeding further would have led to the Agreement to Arbitrate Disputes. The consumer plaintiff argued that the placement of the Terms of Use hyperlinks, the checkout flow, and the hyperlink to “Terms” in a subsequent order confirmation email were too inconspicuous to put the plaintiff on inquiry notice of the contents of the agreement.
All may not be lost for the e-merchant who relies on a browsewrap agreement. “Online retailers would be well-advised to include a conspicuous textual notice with their terms of use hyperlinks going forward,” says the Court of Appeal. For now, clickwrap agreements are a safer bet than browsewrap agreements.
Comments