What Is A Browsewrap Agreement?
A browsewrap agreement is the old horse of the internet when we talk about contracts governing the relationship between online properties and the people who visit those properties. Unfortunately, the internet has moved on from horsepower to whatever we have now. What is a browsewrap agreement? They are agreements you see on sites and apps that state how you can and cannot use the specific online property. You can find these agreements by searching for a link to the Terms buried in the footer of the site or app.
Browsewrap Agreement Enforceability
The browsewrap agreement was the first accepted form for governing the relationship between websites and visitors in the field of internet law. There was just one problem. Browsewrap terms are often unenforceable.
The answer should be obvious – nobody reads the agreement. Seriously. When was the last time you visited a website or app and scrolled down to the bottom to click on the Terms link to take a gander at the site agreement? I’m a lawyer, and I never do it!
As the internet expanded into a full-blown, society-changing medium in the early 2000s, judges started to gain a better understanding of how people used websites. Many began to rule that browsewrap agreements were unenforceable since it isn’t equitable to bind visitors to a set of obligations they’ve never read. Doing so would be the equivalent of forcing someone to buy a car just because they stepped on the dealer lot.
As I write this in 2019, the browsewrap agreement is an antiquated and mostly useless approach to addressing the relationship between visitors to an online property and the business controlling that property. The only scenario where a court will enforce a browsewrap agreement is if the visitor in question testifies that they actually read the agreement. As you can imagine, very few admit to taking such action.
Browsewrap Agreement Example
Zappos experienced the misery of using a browsewrap agreement in 2012. If you are not familiar with the company, Zappos started off selling shoes online before expanding into more or less all apparel. The company has legendarily excellent customer service and was eventually sold off to Yahoo for a mere $1.2 billion in 2009.
In 2012, hackers penetrated Zappos’ security and stole customers’ personal information. Unsurprisingly, the customers filed a class-action lawsuit against the company. Zappos had language in its Terms that would have squashed the class-action litigation and force each customer to sue separately. Zappos would’ve benefited from such an approach since most customers would’ve not pursued their individual claims.
Unfortunately, Zappos used the browsewrap agreement approach to its Terms, to wit, there was a link buried in the footer of the site, and that was it. The judge decided that such an approach wasn’t going to fly, writing:
The judge ruled Zappos’ Terms did not apply and the customers could move forward with the class-action lawsuit. You shouldn’t feel bad for Zappos because the company could have taken a simple step to make the Terms binding and that is what we are talking about next.
What Is A Clickwrap Agreement?
When talking about the internet, a clickwrap agreement is the same document as we find with a browsewrap agreement – the Terms on a website or app. However, there is one significant difference. A clickwrap agreement forces the visitor to the site to affirmatively accept and agree to be bound by the language in the Terms.
The problem with a browsewrap agreement is we can’t say with any certainty that the visitor has read the terms. A clickwrap agreement solves this problem by forcing the visitor to state as much. You typically see this handled through the use of a “check the box” mechanism. Something like this:
Clickwrap Agreement Enforceability
Do courts enforce clickwrap agreements? Yes. Almost always. The only time we see courts not enforce the agreements is where there is a defect or the Terms contain language that is problematic.
For example, in the case of Palmer vs. Kleargear, a court ruled the Terms of Kleargear were unenforceable because of a conceptual defect. Why? Kleargear had included a clause that said any visitor who left a negative review on Yelp would violate the Terms and be required to pay Kleargear $3,500. Yeah, the court wasn’t receptive to this approach. Not only did the Honorable Judge Dee Benson rule Kleargear couldn’t recover the $3,500, but she also awarded the Palmers $306,000 in damages!
Importantly, the clickwrap agreement in the Palmer case worked to functionally bind visitors to the Terms of the site. However, it was the language in those Terms that failed to pass Judge Benson’s inspection.
Clickwrap Agreement Example
Feldman vs. Google is an excellent example of a clickwrap agreement in action. Feldman sued Google in Pennsylvania concerning a claim about Adwords. Google moved to terminate the lawsuit arguing that Feldman had agreed to the Google Terms [a clickwrap agreement], which included a choice of forum clause. This clause sets the location where the parties must litigate all disputes. The Google Terms contained language setting the forum as Santa Clara County, California. You will no doubt be shocked to learn Santa Clara County is home to Google headquarters.
Why was the motion important? For practical reasons. Feldman was unlikely to spend the time and money to travel across the country to pursue the lawsuit in Santa Clara. Feldman would likely drop the claim if forced to travel to California to sue Google.
a. Court’s Opinion
In reviewing the clickwrap agreement, the court noted the following facts:
At the bottom of the webpage, viewable without scrolling down, was a box and the words, “Yes, I agree to the above terms and conditions.” The advertiser had to have clicked on this box in order to proceed to the next step. If the advertiser did not click on “Yes, I agree . . .” and instead tried to click the “Continue” button at the bottom of the webpage, the advertiser would have been returned to the same page and could not advance to the next step. If the advertiser did not agree to the AdWords contract, he could not activate his account, place any ads, or incur any charges. Plaintiff had an account activated. He placed ads and charges were incurred.
In ruling in favor of Google, the court went on to state:
A reasonably prudent internet user would have known of the existence of terms in the AdWords Agreement. Plaintiff had to have had reasonable notice of the terms. By clicking on “Yes, I agree to the above terms and conditions” button, Plaintiff indicated assent to the terms. Therefore, the requirements of an express contract for reasonable notice of terms and mutual assent are satisfied. Plaintiff’s failure to read the Agreement, if that were the case, does not excuse him from being bound by his express agreement.
The last line of this quote is critical. If the visitor checks the box indicating affirmative consent, it does not matter if they later testify they never read the Terms. In short, clickwrap agreements are the best option to bind visitors to website or app Terms.
Browsewrap vs. Clickwrap Agreements
Ah, but you might be thinking to yourself that some sites and apps don’t lend themselves to clickwrap agreements. After all, how do you force someone to agree to the Terms on a blog? The honest answer is you don’t. You don’t necessarily need Terms on a such a site because there isn’t any legal action taking place. Nobody is buying or selling anything. Having said this, some blogs and similar online properties will include a browsewrap agreement as a prophylactic measure. Why? Most people don’t understand browsewrap agreements are not binding.
The law is often full of gray areas. However, the competition between browsewrap and clickwrap agreements has a clear winner. Given browsewrap agreements are rarely enforceable, clickwrap agreements are the way to go for most websites and apps.