Clickwrap Agreements

In the current times, website design is a basic step for business operations. The design must be balanced, with attractive features and easy-to-use interface.  The user interaction has to be accounted for, the visit locations, how the website flows.  And with that, various user agreements are also in place to prevent liability for certain actions, or to impose restrictions on what an individual can do on the website.  So, how might this be enforced? What if there were difficulties in the website design that would render the clickwrap agreement invalid? How might this be decided?

What is a clickwrap agreement?

Now, as we’ve discussed before, a clickwrap agreement is a virtual agreement, made when a digital product is delivered online. This could be anything from a song over iTunes, or an eBook over Nook or Kindle. The idea behind this sort of agreement, differentiating it from a similar “browsewrap” agreement, is how the individual using the page does not need to explicitly assent to the agreement. This would be like a link that takes a user to a page with the full terms or a popup with the ability to assent, by clicking “I agree” or “I accept” the terms and conditions.

How might the design mitigate the agreement?

In Sgouros v. TransUnion, a user sued TransUnion, which is a credit reporting agency, in an attempt to get out of an arbitration agreement and/or to discredit the arbitration agreement. On the page with their terms of use, the box had barely two lines of the terms visible, forcing the individual to go through the entirety of the agreement through that one small box. In addition, the full visible version was labeled as the “printable version” instead of a bolded “Terms of Use.”   Furthermore, there was no notice to read the terms carefully, and the page was unclear about what was being agreed to by the user. This is because there was an authorization paragraph between the terms and the button clicking acceptance. In essence, since there was credit card information being put out, the “I agree” button was vague.

In setting up your clickwrap agreements, this gives some information on how to avoid the same issues.  First, one should make sure that the clickwrap is clearly visible. As clickwraps, and the other “wrap” agreements have their basis in contract law, requiring the user to assent to an agreement.  Next, there should be some sort of encouragement to read the entire terms of use.  Finally, if possible, the terms of use should be as visible as possible, with no confusion as to what the user would be assenting to upon visit.  Thus, any other statements should have either a separate check box to show assent, or should come in front of terms of use, so there is no separation between the button and the agreement.

If you have questions about your clickwrap agreements, or other e-commerce related issues, you may contact us to set up an initial consultation. At our law firm, we assist clients with legal issues related to business, technology, and e-commerce transactions.