Dear Friends: I am a lawyer with a practice limited to Internet law. I have sent the following alert to my clients for their consideration and I thought this information may be of use to my marketing forum friends: There has been a change in the way courts view and enforce the Terms of Service (TOS) and Privacy Policy (PP) of web sites. Previously, the courts have taken the view that a link to your PP or TOS will create an enforceable contract (called a “browser wrap†agreement.) This view was affirmed by then Judge and now Justice Sotomayor in her decision in Specht v. Netscape Communications Corp. However, on September 4, 2009, Judge Sterling Johnson of the Eastern District of New York changed that view with his decision in the case of Hines v. Overstock.com. In his decision, Judge Johnson has taken the view that merely saying that by using a web site you have agreed to its terms does not mean that the user has had reasonable notice to those terms. His view was that for the PP and TOS to be enforceable, the site user needs to indicate his acceptance of these terms by a manifestation of assent. It is my belief that this decision changes the previous law of “browser wrap†to a new level, the “click wrap†(i.e. the user clicks his consent.) While the opinion of Judge Johnson is not binding on all courts, I am of the belief that it will be embraced throughout the court system. His decision reminds me of the decision in Parker v South Eastern Railway, an English case from 1877, which every first year lawyer learns in their Contracts class. In that case, the jury decided that it is NOT reasonable to expect people to read the “contract†on the back of a railroad ticket. This case has never been overturned and is the law in the U.S., having been used as the precedent and cited in case law to include the back of movie tickets, parking lot receipts, coat check receipts, etc. Given this old precedent, I think the Hines case will quickly become the law of the land with lawyers arguing a browser wrap contract is no different than the back of a movie ticket. My recommendation: To make sure your users have constructive notice of the terms contained in your PP and TOS I strongly recommend that you use an “I agree†click button on your web site for your PP & TOS when your users register and (if a commercial site) again during the ordering process.
That's interesting, and I think a step in the right direction. I hate that site (and credit card companies, and software makers) expect you to keep up to date with the ToS even when you don't get a clear notification of changes. (Or you get a notice that there was a change and have to wade through 20 pages of legalese to try and figure out what has changed). I've noticed more and more commercial sites doing just what you suggest, requiring the clicking of "I accept these terms" often along with essentially shoving the ToS, User Agreement, etc in your face.
Hello, I am in the Hosting Business, and most billing applications (WHMCS in my case) have the option to force users to agree to your terms of service. This should be checked at all times. This would create a "Legal Contract" in the event that you need to suspend or terminate an account for TOS Violations.