Internet contracts – beyond clickwrap and browserwrap | Kilpatrick Townsend & Stockton LLP
In a concurring opinion, Mr. Miller Baker, an international trade judge sitting by designate, looked to California law to discuss four types of internet contracts and their enforceability under California law. To see 2022 WL 1010531, at *8 (Baker, J., concordant). Judge Baker based his analysis on two Internet contract formation cases by the California Court of Appeals, long c. Provide Commerce, Inc., 245 Cal. App. 4th 855, 200 Cal. Rptr. 3d 117 (2d Dist. 2016), and Sellers v JustAnswer LLC, 73 Cal. App. 5th 444, 289 cal. Rptr. 3d 1 (4th Arr. 2021), petition for review filed, No. S273056 (Cal. Feb. 8, 2022). the Sellers the decision in turn relied on a “scientific opinion” by Judge Jack B. Weinstein in another internet contract case, Berkson v Gogo LLC, 97 F. Supp. 3d 359, 394–401 (EDNY 2015).
“Connection envelopes” occupy the “grey area” in between. ID. to *14. “‘Sign-in wrap’ agreements are those in which a user registers to use an Internet product or service, and the registration screen indicates that acceptance of a separate agreement is required before the user can access the service. Although a link to the separate agreement is provided, users are not required to indicate that they have read the terms of the agreement before signing up. ID. to *12 (quoting Sellers, 289 Cal. Rptr. 3d to 15). According to Judge Baker, the “executory force [of sign-in wraps] requires a prominent text notice that completion of a transaction or registration signifies consent to the site’s terms and conditions. Whether such a notice is sufficiently visible will depend on the transactional context, the size of the notice in relation to other text on the site, the proximity of the notice to the relevant button or box on which the user must click to complete the transaction or register for the service, and whether the hyperlinks in the notice are easily identifiable. ID. to *14.
Categorizing the Internet contract at issue as a “loopback”, Judge Baker agreed with the majority that the contract was unenforceable because (among other reasons) the website’s notice of the contract terms was “insufficiently conspicuous” and ” confusingly placed” on the website. ID. at *15-16.