Yesterday, I noted the Pennsylvania Supreme Court had agreed to hear a case involving browse-wrap arbitration agreements. Later in the day, the Seventh Circuit issued a decision concerning one such agreement, finding that a consumer and a home improvement had entered into a valid and enforceable agreement. Adopting case law from the 9th and 2nd Circuits, the majority opinion applied a two-factor test: “(1) did the website provide reasonably conspicuous notice of the terms to which the consumer will be bound, and (2) did the consumer take some action that unambiguously manifested his or her assent to those terms?,” with an additional five factors going to the first of conspicuousness question.
Concurring in the judgment, Judge Hamilton argued that “courts should try to rethink how we approach the issues of ‘click-wrap’ and ‘browse-wrap’ contracts of adhesion in online commerce,” specifically by “treat[ing] whether a ‘browse-wrap’ user interface gives sufficient notice of hidden but hyperlinked terms and conditions as a question of fact rather than a question of law.” Judge Hamilton’s concurrence explained the problems with browse-wrap adhesion contracts at length, comparing different companies’ models and discussing academic literature. He nonetheless concurred in the judgment on the grounds that the plaintiff “chose to litigate this case without trying to raise material factual disputes about fair notice.”
