I had hoped to publish this blog post over two weeks ago, but you know how that goes – work travel, projects for clients, jury duty, and a head cold took priority. However late, I still want to clarify an answer I gave as part of the COVE conference legal panel on February 21. A conference attendee asked about the enforceability of clickthrough agreements. I am concerned that I may have provided a confusing explanation of browsewrap and clickthrough agreements and that I may have given the wrong impression that clickthrough agreements might not be enforceable. To be clear, clickthrough agreements are enforceable when properly implemented (which is not difficult). 

What follows is a little more information about browsewrap and clickthrough agreements. I’ll discuss one component of the legal formation of a contract (mutual assent), compare browsewrap and clickthrough agreements, explain why clickthrough agreements are generally enforceable, and then describe the problems with browsewrap agreements and ways in which browsewrap agreements may be enforceable.

Lame attorney disclaimer – for advice specific to your circumstances on how to implement an enforceable agreement on your website, please contact an attorney. 

Showing assent

A basic understanding of part of contract formation is required to understand the legal differences between browsewrap and clickthrough agreements. To form a contract each party must show that it intended to be bound by the agreement—each party must show there was an offer to contract and an acceptance of that offer, which shows mutual assent. Mutual assent may be achieved through different methods. Parties may physically sign an agreement, use an electronic signature service, make an affirmative act that shows assent, etc. (The method of assent is separate from the type of agreement, such as terms of use, privacy policy, user agreement, end user license agreement, terms of service, etc.)

Clickthrough v. browsewrap 

Clickthrough and browsewrap agreements differ in how the offeree (the one accepting an offer) shows assent. A visitor agrees to a clickthrough agreement by taking an affirmative act, such as clicking “yes” on a check box. A visitor (theoretically) agrees to a browsewrap agreement by being on notice of an agreement (e.g., through terms of use) and accepting the agreement through continued use of the website.

(Sidenote: Why “browsewrap? It’s derived from the use of “shrinkwrap” to describe agreements that were literally wrapped around packaged software. A purchaser manifested assent to the agreement by opening the shrinkwrapped box.)

Clickthrough assent

Showing assent with a clickthrough agreement is pretty straightforward. The website owner will only allow a user to perform a given function if he clicks that he understands and agrees to the agreement. For example, think about the last time you installed software. A dialog box likely popped up and required you to click that you accept the terms of use. By structuring website use so that a user must agree to the clickthrough agreement before performing a certain function (typically a search or purchase), the website owner knows that the user has shown assent to the agreement.

More on browsewraps

The problem with browsewrap agreements is that it’s tough to adequately show that a website user is on notice and agrees to an agreement. One legal scholar calls browsewrap agreements “not a contract.” He states:

Although there are some aberrational cases to the contrary, for the most part courts do not treat browsewraps as a contract, and anyone relying on a so-called browsewrap does so at their extreme peril. 

(See his blog post for a more in depth look at this topic and the Zappos case.)

What I tried to describe (too quickly and unclearly) at the COVE conference, is that it is pretty easy to show that a website user assents to a clickthrough agreement: as described above, the user must accept an offer to use the website. In contrast, proving that a website visitor has assented to a browsewrap agreement is more difficult.

However, showing assent through a browsewrap agreement can be done. Enforceability of browsewrap agreements depends on a website user’s actual or constructive knowledge of the agreement. Here are some factors courts have considered for determining whether actual or constructive knowledge of a browsewrap agreement exists.

  • Was the agreement prominently referenced many times throughout the website? 
  • Was the agreement present during an order/purchase/signup process?
  • Would a reasonable prudent user be on notice of the agreement?
  • Did the link to the agreement stand out from the rest of the webpage? Does a website user have to scroll to find it? 

Depending on the answer to those questions, a browsewrap agreement might be enforceable. Any company relying on a browsewrap agreement to implement a terms of use for its website should consult an attorney. (Want to read a couple cases that deal with this issue? Check out Specht v. Netscape Communications Corp. (court found no contract existed), Van Tassell v. United Marketing Group, LLC (court found contract existed).)

What’s the bottom line? 

Clickthrough agreements are by far the preferred method for implementing binding agreements through website use, and it might be possible to create binding browsewrap agreements. I was concerned that I may have given the impression that clickthrough agreements are not be enforceable at the COVE conference. That is not the case. Again, clickthrough agreements are enforceable when properly implemented.

-Mitch

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