SMS Confirming "Opt-Out" is Legal
10/01/13 12:25
The FCC clarified a nagging problem. Is sending an SMS (text) confirming a customer’s decision to opt-out of further marketing messages, illegal? Until now this was uncertain. In accordance with industry standards, as set by the Mobile Marketing Association (MMA), an advertiser is required
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Must Website Users Click "I Accept" to Sign a Valid Contract?
12/07/12 22:41
What does it take to make an online digital contract valid? Is a click on a website policy equivalent to a signature on a contract? A good overview of this issue was presented in 2011 in Kwan v. Clearwire Corp. (W.D. Wash., 2011). Below is an excerpt from the case. If you have any questions about drafting legally compliant website terms and conditions, feel free to contact our website lawyer at 888-700-2993
One primary means of forming contracts on the internet are so-called "clickwrap" (or "click-through") agreements, in which website users typically click an "I agree" box after being presented with a list of terms and conditions of use. Overstock, 668 F. Supp. 2d at 366. Click-wrap agreements derive their name by analogy to "shrinkwrap" used in the licensing of tangible forms of software sold in packages. Specht v. Netscape Comm'ns Corp., 306 F.3d 17, 22 n.4 (2d Cir. 2002) (Sotomayor, J.). "Just as breaking the shrinkwrap seal and using the enclosed computer program after encountering notice of the existence of governing license terms has been deemed by some courts to constitute assent to those terms in the context of tangible software, . . . so clicking on a webpage's clickwrap button after receiving notice of the existence of license terms has been held by some courts to manifest an Internet user's assent to terms governing the use of downloadable intangible software. . . ." Id. (internal citation omitted).
In addition to clickwrap agreements, "browsewrap" agreements have arisen as another means of contracting on the internet. Overstock, 668 F. Supp. 2d at 366. In a browsewrap agreement, the terms and conditions of use for a website or other downloadable product are posted on the website typically as a hyperlink at the bottom of the screen. Id. Unlike a clickwrap agreement, where the user must manifest assent to the terms and conditions by clicking on an "I agree" box, a browsewrap agreement does not require this type of express manifestation of assent. Id. Rather, a party instead gives his or her assent by simply using the product - such as by entering the website or downloading software. See id. In ruling upon the validity of browsewrap agreements, courts primarily consider whether a website user has actual or constructive notice of the terms and conditions prior to using the website or other product. Id. (citing Specht, 306 F.3d at 20 (finding insufficient notice)). Elements of shrinkwrap, clickwrap and browsewrap agreements are at issue here.
In the seminal decision of Specht v. Netscape Comms. Corp.,7 the Second Circuit held that internet users did not have reasonable notice of the terms in an online browsewrap agreement and therefore did not assent to the agreement under the facts presented to the court. 306 F.3d at 20, 31. In Specht, users of a website were urged to click on a button to download free software. Id. at 23, 32. There was no visible indication that clicking on the button meant that the user agreed to the terms and conditions of a proposed contract that contained an arbitration clause. Id. The only reference to the terms was located in text visible if the users scrolled down to the next screen, which was "submerged." Id. at 23, 31-32. Even if a user did scroll down, the terms were not immediately displayed. Id. at 23. Users would have to clink on a hyperlink, which would take them to a separate webpage entitled "License & Support Agreements." Id. at 23-24. Only on that webpage was a user informed that the user must agree to the license terms before downloading a product. Id. at 24. The user would have to choose from a list of licensing agreements and again click on another hyperlink in order to see the applicable terms and conditions. Id. The Second Circuit concluded on these facts that there was not sufficient or reasonably conspicuous notice of the terms that the plaintiffs could have manifested assent to the terms under these conditions. Id. at 32, 35. The Second Circuit, however, was careful to distinguish the method just described from clickwrap agreements, which do provide sufficient notice. Id. at 22 n. 4, 32-33.
Significantly, in Register.com, Inc. v. Verio, 356 F.3d 393 (2d Cir. 2004), the Second Circuit distinguished Specht on the basis that the facts in Specht "did not compel the conclusion that its downloaders took the software subject to those terms because there was no way to determine that any downloader had seen the terms of the offer." Id. at 402. In Register.com, the facts were crucially distinguishable from Specht because the Register.com user saw the terms of the offer and admitted that it was aware of the terms of the offer. Id. The Second Circuit held that, where a plaintiff knew of the terms of the offer, there was no reason why enforceability of the terms should depend on whether the plaintiff was offered an "I agree" button to click. Id. at 403.
Any questions about drafting legally compliant website terms and conditions? Contact our website lawyer at 888-700-2993
One primary means of forming contracts on the internet are so-called "clickwrap" (or "click-through") agreements, in which website users typically click an "I agree" box after being presented with a list of terms and conditions of use. Overstock, 668 F. Supp. 2d at 366. Click-wrap agreements derive their name by analogy to "shrinkwrap" used in the licensing of tangible forms of software sold in packages. Specht v. Netscape Comm'ns Corp., 306 F.3d 17, 22 n.4 (2d Cir. 2002) (Sotomayor, J.). "Just as breaking the shrinkwrap seal and using the enclosed computer program after encountering notice of the existence of governing license terms has been deemed by some courts to constitute assent to those terms in the context of tangible software, . . . so clicking on a webpage's clickwrap button after receiving notice of the existence of license terms has been held by some courts to manifest an Internet user's assent to terms governing the use of downloadable intangible software. . . ." Id. (internal citation omitted).
In addition to clickwrap agreements, "browsewrap" agreements have arisen as another means of contracting on the internet. Overstock, 668 F. Supp. 2d at 366. In a browsewrap agreement, the terms and conditions of use for a website or other downloadable product are posted on the website typically as a hyperlink at the bottom of the screen. Id. Unlike a clickwrap agreement, where the user must manifest assent to the terms and conditions by clicking on an "I agree" box, a browsewrap agreement does not require this type of express manifestation of assent. Id. Rather, a party instead gives his or her assent by simply using the product - such as by entering the website or downloading software. See id. In ruling upon the validity of browsewrap agreements, courts primarily consider whether a website user has actual or constructive notice of the terms and conditions prior to using the website or other product. Id. (citing Specht, 306 F.3d at 20 (finding insufficient notice)). Elements of shrinkwrap, clickwrap and browsewrap agreements are at issue here.
In the seminal decision of Specht v. Netscape Comms. Corp.,7 the Second Circuit held that internet users did not have reasonable notice of the terms in an online browsewrap agreement and therefore did not assent to the agreement under the facts presented to the court. 306 F.3d at 20, 31. In Specht, users of a website were urged to click on a button to download free software. Id. at 23, 32. There was no visible indication that clicking on the button meant that the user agreed to the terms and conditions of a proposed contract that contained an arbitration clause. Id. The only reference to the terms was located in text visible if the users scrolled down to the next screen, which was "submerged." Id. at 23, 31-32. Even if a user did scroll down, the terms were not immediately displayed. Id. at 23. Users would have to clink on a hyperlink, which would take them to a separate webpage entitled "License & Support Agreements." Id. at 23-24. Only on that webpage was a user informed that the user must agree to the license terms before downloading a product. Id. at 24. The user would have to choose from a list of licensing agreements and again click on another hyperlink in order to see the applicable terms and conditions. Id. The Second Circuit concluded on these facts that there was not sufficient or reasonably conspicuous notice of the terms that the plaintiffs could have manifested assent to the terms under these conditions. Id. at 32, 35. The Second Circuit, however, was careful to distinguish the method just described from clickwrap agreements, which do provide sufficient notice. Id. at 22 n. 4, 32-33.
Significantly, in Register.com, Inc. v. Verio, 356 F.3d 393 (2d Cir. 2004), the Second Circuit distinguished Specht on the basis that the facts in Specht "did not compel the conclusion that its downloaders took the software subject to those terms because there was no way to determine that any downloader had seen the terms of the offer." Id. at 402. In Register.com, the facts were crucially distinguishable from Specht because the Register.com user saw the terms of the offer and admitted that it was aware of the terms of the offer. Id. The Second Circuit held that, where a plaintiff knew of the terms of the offer, there was no reason why enforceability of the terms should depend on whether the plaintiff was offered an "I agree" button to click. Id. at 403.
Any questions about drafting legally compliant website terms and conditions? Contact our website lawyer at 888-700-2993
Does the Law Regulate What I say in Google Ads?
11/07/12 15:04
| The short answer is Yes. Section 5 of the FTC (Federal Trade Commission) which governs misleading and false statements govern statements you make in any advertisements. FOr that matter numerous state laws govern similar practices as well. This issue came up recently in an FTC action to stop a debt settlement company using online GoogleAds to promote their claims. In this case, the debt settlement company relied predominantly on Google Ads to advertise such statements as “Reduce Debt 70% want Proof?” and “Save up to 70% On Credit Card Debt.” The FTC, in their case, charged that the claims in the GoogleAds were misleading for a number of reasons, including failure to take into account the clients that dropped out of the programs. Putting aside any issues involving an intent to deceive in this particular case, legitimate companies can fall prey to such mistakes as well. Could the company have provided information on the landing page to prevent the advertisements from being misleading? Could the company have provided additional working within Google Ads to reduce the likelihood of consumer confusion? This is a case where an experienced |
Can I Post False or Made-Up Reviews or Endorsements?
10/07/12 22:16
| One company did. The Federal Trade Commission (FTC) didn’t like it. Back in December 2009, the FTC published a guide on endorsements. The Guid effectively reiterated the law regarding false and deceptive advertising. The Guide is itself not a law, but provides reference on how the FTC views online endorsements. In this particular chase, the Company failed to have their online practices properly vetting with an experienced |
| USA (For FTC) v. Spokeo, Inc. |
Can I Resell Information I Collect from Social Media Sites?
10/07/12 20:44
| Yes, but be careful! Assuming you collect the information in accordance with the law and the social media sites’ |