Browsewrap Botch - How to ensure that your online terms are not enforceable

Even the big boys can mess up. Barnes & Noble sold some HP tablets from its online store and then cancelled the order. The customer sued. The outcome of the case hinged on the enforceability of Barnes & Noble’s Terms of Use posted on its website.

At checkout, there was a link to the Terms of Use. However, the customer was not required to take an action to show that he accepted them. Acceptance of the Terms of Use was not a required step in order to complete the purchase. Under U.S. law, a person needs to agree in order for there to be a binding agreement. In this case, the customer claimed that he never agreed to the Terms of Use and therefore was not bound by them. The court this past August sided with the customer. The end result was that the carefully crafted Terms of Use used by Barnes & Noble for millions of online purchases was totally useless (read unenforceable).

In legal circles, the Barnes & Noble Terms of Use are referred to as a “browsewrap” agreement. The idea is that simply by browsing the website, the customer is automatically bound by the agreement terms. However, the courts have held that browsing is not an affirmative act of acceptance.

Bottom Line: Users must take an affirmative action in order to be legally bound by online terms. These actions can be checking a box or pushing an acceptance button when it’s clear that the action indicates acceptance of the Terms of Use.

Sources: Nguyen v. Barnes & Noble, Inc., 2014 WL 4056549 (9th Cir. Aug. 18, 2014)

By William S. Galkin, Esq. | December 08, 2014
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William Galkin manages GalkinLaw. Mr. Galkin has dedicated his legal practice to representing Internet, e-commerce, computer technology and new media businesses across the U.S. and around the world. He serves as a trusted adviser to both startup and multinational corporations on their core commercial transactions.

  
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