Internet Law Update: Clickwrap Arbitration Clause Found Enforceable

Thanks to Evan Brown over at the Internet Cases blog for pointing out the recent case Via Viente Taiwan, L.P. v. United Parcel Service, Inc., 2009 WL 398729 (E.D. Tex. February 17, 2009) in his article titled “Clickwrap binding despite claim of no opportunity to read terms”, which discusses how that the clickwrap agreement between the United Parcel Service and one of its customers was in fact binding.  The court rejected all of the defendant’s arguments that it never had an opportunity to review the clickwrap agreement before the software was downloaded, although the primary point seems to be that the defendant was a very large and sophisticated company who should have been aware of the clickwrap agreement and certainly retained the benefits of the software.

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Web Contract Attorneys | The Enforceability of Clickwrap Agreements

Recommended Reading: For web contract attorneys seeking to understand the contest and enforceability of online clickwrap agreements, we recommend the following article written by Rachel Cormier Anderson and published by the Shidler Journal of Law

Enforcement of Contractual Terms in Clickwrap Agreements >> Shidler Journal of Law, Commerce & Technology

In three recent cases, courts have invalidated portions of consumer clickwrap agreements containing either forum selection or binding arbitration clauses. In the first case, the Washington State Court of Appeals invalidated a forum selection clause found in a clickwrap agreement because the clause was contrary to state consumer protection policies. In the second case, the California Court of Appeals rejected an online clickwrap agreement calling for binding arbitration in a specified forum when the plaintiff sought to bring a class action claim. Finally, the U.S. Court of Appeals for the Fifth Circuit recently declared a binding arbitration clause because it was unconscionable. Although these internet law cases address a relatively new form of contracting known as "clickwrap agreements," the essential issue in each case was not new. These cases suggest that courts are willing to accept the validity of clickwrap agreements in general, but have invalidated specific clauses based on traditional contract doctrines such as unconscionability and public policy. This Article examines these recent cases in light of existing precedent concerning the enforceability of clickwrap agreements and other similar types of online or ecommerce contracts. 

Technorati Tags: clickwrap agreement

Web Contract Lawyer Advice | Clickwrap Contracts Depend on the Details

The legal status of shrink wrap contracts in the US is somewhat unclear. One line of cases follows ProCD v. Zeidenberg which held such web contracts enforceable (see, e.g., Brower v. Gateway) and the other follows Klocek v. Gateway, Inc., which found the online contracts at hand unenforceable (e.g., Specht v. Netscape Communications Corp.), but did not comment on shrink wrap ecommerce contracts as a whole. These decisions are split on the question of consent, with the former holding that only objective manifestation of consent is required while the latter require at least the possibility of subjective consent.

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Traverse Legal attorneys can help your company, in-house counsel or trusted out-side firm navigate the challenging issues presented by an increasingly complex on-line world. From end user agreements, privacy agreements and e-commerce/affiliate contracts, we have you covered.

Our internet attorneys handle a variety of complex litigation and cyber-law issues in the following niche areas, including:

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