I’ve discussed why every website owner needs to have an effective Terms of Use and/or Service Agreement (also called an End User License Agreement, but you can call it what you want). Now I want to briefly hit on how the provisions of the Terms of Use can be enforced under New York Law.
The courts here have drawn a huge line between what they call “clickwrap” vs. “browsewrap” agreements. A clickwrap agreement is an online agreement where the user has to click on an “I accept” type button or box. Browsewrap agreements are those that are on a website but there is not any physical act needed for acceptance. Many websites have browsewrap agreements which state that use of the website constitutes consent to the provisions of the browsewrap agreement.
Like most legal things, the more hoops you make people jump through, and assuming they do jump through them, the courts will be more strict in their enforcement of the agreement. The legal way to say the preceding sentence is that to enforce an online agreement against a consumer (or other party) the consumer must have been given reasonable notice with clearly presented terms and must have manifested assent to be bound by the terms.
Some examples of court decisions showing what this means:
Specht v. Netscape Communications Corp. – In this case the Second Circuit held that an arbitration provision in Netscapes terms of use (in a browsewrap license) was not enough notice to the consumer. While this was in a browsewrap license, the user had to click to download the browser initially so this is sort of a grey area case.
Fteja v. Facebook – In this case the Southern District of New York held that the forum selection clause in Facebook’s terms of service was enforceable against a consumer that had accepted Facebook’s clickwrap which made the consumer click on a box which stated that “By clicking Sign Up, you are indicating that you have read and agree to the Terms of Service.”
Jerez v. JD Closeouts – In this case, the District Court of Nassau County held that a browsewrap Terms of Sale provision found on the “About” page of the website was not enough to enforce the forum selection clause.