Are Click-Wrap Arbitration Agreements Enforceable?
A click-wrap agreement is the bane of every tech user. These agreements — the ones where a user has to click to accept the terms and conditions — are rarely read by consumers. As an example, the software license agreement for Apple’s current operating system, iOS 13, is 13 pages long — single spaced, 8.5x11” pages (who knows how many screens that is on your iPhone?) — and it is reasonable to suspect that the number of consumers who have read all of these pages can be counted on one hand.
Recently, Timothy Hildago sued the Amateur Athletic Union (AAU) over a data breach. The AAU sought to enforce the mandatory arbitration provision of its terms and conditions. The court noted that to be bound by an arbitration agreement contained within the click-wrap agreement, the Hildago must had received “reasonable notice of the arbitration provision.”
Among the issues the court looked at were:
The font size, bolding, and capitalization of the relevant language;
The color of the hyperlink directing the user to the full agreement and whether it “stands out” from the other language;
Whether the language next to the checkbox sufficiently notifies the user that he or she is entering into an agreement (as opposed to merely completing a purchase or step, e.g., clicking “place your order” does not specifically manifest assent to additional terms);
The layout of the page, including whether the page is “cluttered”;
Whether the relevant language directing the user to the full agreement is conspicuously placed on the webpage;
The number of other links on the same webpage;
The number of different font types and sizes used on the same webpage;
Whether the page contains distracting elements, such as other “buttons” or “promotional advertisements”; and
Whether notice of the full agreement is provided contemporaneously with the user’s agreement (i.e., on the same page), or later in time (i.e., via a follow-up email).
In the end, the court sided with the AAU and ordered that arbitration be had.
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