The Privacy Lawyer: Get Real About Your Terms-Of-Service Agreements
Browse-wrap agreements may not be enforceable if they're not obvious and their terms are too onerous, Parry Aftab says.
But how enforceable are these agreements, if the users don't affirmatively click "I agree" or otherwise do something to accept their terms? If it turns out that courts are reluctant to enforce them, this may become a plaintiff litigator's dream and the corporate lawyer's nightmare instead.
The law in this area has been evolving over the last decade. Beginning with the "shrink-wrap" cases, in which the conditions set forth on software packaging were deemed accepted once the package was opened and the product installed, the courts have tried to be both innovative and practical. "Click-wrap" agreements are the online equivalent of shrink-wrap agreements but require users to click "I accept" or otherwise do something to indicate they've read and accepted the terms. These are commonly used at software-download and E-commerce Web sites and are generally upheld by the courts as well.
But the newest form of virtual contract acceptance, known as "browse-wrap" agreements, may not be as enforceable, and for good reason. Browse-wrap agreements are most commonly used with terms-of-service or privacy policies, where the user is deemed to have accepted the terms merely by using the site. While most Web sites' privacy and terms-of-service policies use this method, these agreements are generally not very obvious. Is that fair? Do most Web-site users understand that they've entered into a contract merely by visiting a Web site? Probably not.
How enforceable should browse-wrap agreements be? It may depend entirely on how accessible and obvious the agreements are and what they provide. The less obvious and more onerous their terms, the less likely they'll be upheld in a court of law. Drafters of these agreements need to heed an old farmers' adage: "Pigs get fat, hogs get slaughtered." The further the Web site seeks to push the issue, the more likely a court will determine that no valid and enforceable agreement exists at all.
Certain kinds of agreements receive heightened scrutiny by courts. These include arbitration agreements and consent to select jurisdiction clauses and are less likely to be enforced unless the Web site can prove clear assent to the terms of the agreements. Typically courts review the circumstances surrounding these kinds of agreements. How obvious were these terms? Did the consumer knowingly agree to them? How was this agreement manifested? Because of this, you shouldn't try to lump everything into the terms of service without requiring some type of assent by the user. I use the "sniff" test: If it "smells" bad, it may not be enforceable.
An example of an actual terms-of-service provision relating to enforcement of rights and handling disputes that could be seen as going too far is included below, with certain text intentionally omitted:
5 Top Federal Initiatives For 2015As InformationWeek Government readers were busy firming up their fiscal year 2015 budgets, we asked them to rate more than 30 IT initiatives in terms of importance and current leadership focus. No surprise, among more than 30 options, security is No. 1. After that, things get less predictable.
Top IT Trends to Watch in Financial ServicesIT pros at banks, investment houses, insurance companies, and other financial services organizations are focused on a range of issues, from peer-to-peer lending to cybersecurity to performance, agility, and compliance. It all matters.
Join us for a roundup of the top stories on InformationWeek.com for the week of September 18, 2016. We'll be talking with the InformationWeek.com editors and correspondents who brought you the top stories of the week to get the "story behind the story."