3 Steps To Ensure Enforceability of Your Website’s Terms of Use

3 Steps To Ensure Enforceability of Your Website's Terms of Use 2

Morrison & Foerster – Aaron P. Rubin and Daniel A. Zlatnik Operators of social media platforms and
other websites typically manage their risks by imposing terms of use or terms of service for the sites.

As we previously wrote, websites must implement such terms properly to ensure that they are enforceable. Specifically, users must be required to manifest acceptance of the terms in a manner that results in an enforceable contract.

But what specifically constitutes such acceptance, and what steps should website operators take to memorialize and maintain the resulting contract?

This article attempts to answer these practical questions.

Use Boxes or Buttons to Require Affirmative Acceptance

Website operators should avoid the cardinal sin in online contract formation: burying terms of use in a
link at the bottom of a website and attempting to bind users to those terms based merely on their use of the website. Outside of some specific (and, for our purposes, not particularly relevant) circumstances, such approaches, often confusingly referred to as “browsewrap” agreements, will not
result in a valid contract because there is no objective manifestation of assent.

(Note, though, that even so-called browsewrap terms may be helpful in
some circumstances, as we described in this post.)

Moreover, even website terms presented through a “conspicuous” link may not be enforceable if users are not required to affirmatively accept them. For example, in Nguyen v. Barnes &
Noble, Inc., Barnes & Noble did include a relatively clear link to its website terms on its checkout page, but nothing required users to affirmatively indicate that they accepted the terms. The Ninth Circuit held, therefore, that Barnes & Noble could not enforce the arbitration
provision contained in the terms.

While the specific outcome in Barnes & Noble arguably is part of a Ninth Circuit trend of declining to enforce arbitration clauses on the grounds that no contract had been formed, nothing
in the opinion limits the Ninth Circuit’s holding to arbitration provisions. The
case is an important cautionary tale for all website operators.

To avoid the Barnes & Noble outcome, website operators should implement
two key features when users first attempt to complete an interaction with the site, such as making a purchase, registering an account, or posting content: (1) present website terms conspicuously, and (2) require users to click a checkbox or an “I accept” button accompanying the terms. The goldstandard
implementation is to display the full text of the website terms above or below that checkbox or button.

If they fit on a single page, that is helpful, but an easy-to-use scroll box can work as well. Website operators taking the scroll box approach may consider
requiring users to actually scroll through the terms before accepting them.

Many website operators, however, choose not to present the terms themselves on the page where a user
is required to indicate acceptance. Instead, such website operators present a link to the terms alongside a checkbox or button. Courts have ratified this type of implementation as long as it is abundantly clear that the link contains the website terms and that checking a box or clicking a button
indicates acceptance of those terms.

This was essentially the implementation at issue in a 2012 case from the
Southern District of New York, Fteja v. Facebook, Inc. Specifically, signing
up for Facebook required users to click a button labeled “Sign Up,” and
immediately below that button was the text, “By clicking Sign Up, you are indicating that you have read and agree to the Terms of Service.” The phrase “Terms of Service” was underlined and operated as a link to the terms.

The court reasoned that whether the plaintiff read the terms of service was
irrelevant because, for the plaintiff and others “to whom the internet is an indispensable part of daily life,” clicking on such a link “is the twentyfirst century equivalent” of turning over a cruise ticket to read the terms printed on the back. As sure as vacationers know they can read the small print on their cruise tickets to find the terms they accept by embarking on the cruise, the plaintiff knew where he could nread the terms of use he accepted by using Facebook. The parties formed an
enforceable contract once the plaintiff clicked the “Sign Up” button.

This reasoning, however, does not necessarily mean that an implementation like the one at issue in Fteja will always will result in an enforceable contract. Because it relied
on the plaintiff’s admitted proficiency in using computers and the Internet, the court likened the “Terms of Service” link to the backside of a cruise ticket.

This leaves room to argue for a different outcome when a website operator should expect that novice computer users will be among its visitors. The simple way to avoid that (perhaps far-fetched) argument is to expressly identify the hyperlink as a means to read the contract terms. That approach succeeded in Snap-On Business Solutions v. O’Neil & Assocs., where the website expressly instructed users, “[i]mmediately following this text is a green box with an arrow that users may
click to view the entire EULA.”

These cases illustrate how important it is to expressly connect users’ affirmative actions to the terms of use. In particular, the checkbox or button and accompanying text should clearly indicate that the user’s click signifies acceptance of the website terms. The terms should be presented in a clear, readable typeface and be printable, and the “call to action” text should
be unambiguous—not susceptible to interpretation as anything other than acceptance of the website terms.

Here are some examples:
• “By checking this box, I agree to the ‘Terms of Use’ presented above on this page.”
• “By clicking ‘I Accept’ immediately below, I agree to the ‘Terms of Service’ presented in the scroll box above.”
• “Check this box ¨ to indicate that you accept the Terms of Use (click this link to read the Terms of Use).” (In this example, the website terms would be presented through
a link, as in the Fteja case. The added instruction, “click this link to read the Terms of Use,” avoids any potential argument that a Fteja-type implementation only works where users can be assumed not to be novice computer users.)

Ensure You Can Prove Affirmative Acceptance Even website operators that properly implement website
terms often neglect another important task: making sure they can prove that a particular user accepted the terms. One common approach—to present declarations from employees— is illustrated in Moretti v. Hertz Corp., a 2014 case from the Northern District of California. The employees in that case
affirmed via declarations that (1) a user could not have used the website without accepting the website terms, and (2) the terms included the relevant provision when the use took place.

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