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Enforcement of electronic contracts may depend on how executed
February 1, 2021
Enforcement of electronic contracts may depend on how executed
            Electronic contracts are perfectly acceptable and enforceable just like a signed hard copy.  But like hard copies, disputes arise whether the agreement provided sufficient notice of its provisions, often prerequisite to enforcement.  Even in hard copies, small print and hidden provisions can cause an agreement or particular provisions to be unenforceable; so too with electronically executed contracts.  
            This issue is particularly essential in the alarm industry [and you know I include security, fire, pers and guard in that definition] where the industry relies on specifically worded “protective” provisions to insulate against liability.  
            A common question that comes up from time to time is whether the alarm contract can provide that the alarm company has the authority to change terms and conditions, binding the subscriber to these changed terms.  Another frequent question is how the alarm contract can be executed, using click through or wrap around.  The court decision below addresses these issues in the context of a lawsuit by a woman injured on vacation suing the internet company who booked the trip.  The internet company sought to rely on an exculpatory clause in the on-line terms and conditions.
            Bottom line, click through is the way to go, and it’s what I’ve counseled all along.  The case is in USDC, PA, titled: Putt v Tripadvisor.  Here are relevant parts of the court’s decision which denied a motion to dismiss the case.

            “Agreements appearing on internet webpages are often referred to as either “clickwrap” or “browsewrap” agreements.  See Zabokritsky v. JetSmarter, Inc., No. 19-273, 2019 WL 2563738, at *3 n.30 (E.D. Pa. June 20, 2019).  A clickwrap agreement generally requires a webpage user to actively consent to terms or conditions, such as by clicking “accept” or checking a dialog box to proceed with an internet transaction.  See James v. Glob. TelLink Corp., 852 F.3d 262, 267 (3d Cir. 2017); HealthPlanCRM LLC v. AvMed, Inc., 458 F. Supp. 3d 308, 334 (W.D. Pa. 2020); Feldman v. Google, Inc., 513 F. Supp. 2d 229, 236 (E.D. Pa. 2007).  A browsewrap agreement is “generally posted on a website via hyperlink at the bottom of the screen” and “do[es] not require users to expressly manifest assent.”  Glob. TelLink Corp., 852 F.3d at 267.  Clickwrap agreements are “routinely enforced by the courts.”  HealthPlanCRM, 458 F. Supp. 3d at 334 (citing Meyer v. Uber Techs., Inc., 868 F.3d 66, 75 (2d Cir. 2017) (“Courts routinely uphold clickwrap agreements for the principal reason that the user has affirmatively assented to the terms of agreement by clicking ‘I agree.’”)).  A browsewrap agreement’s enforceability “often turn[s] on whether the terms or a hyperlink to the terms are reasonably conspicuous on a webpage.”  Glob. TelLink Corp., 852 F.3d at 267.  “Where [a] website contains an explicit textual notice that continued use will act as a manifestation of the user’s intent to be bound, courts have been more amenable to enforcing browsewrap agreements.”  Id. (quoting Nguyen v. Barnes & Noble Inc., 763 F.3d 1171, 1177 (9th Cir. 2014).   
            The Court cannot resolve the enforceability of the Agreement at this stage.  Whether the Agreement is clickwrap or browsewrap, as well as whether it was reasonably conspicuous such that Ms. Putt should have been on notice that she would be bound by it, depends on how it was presented on Viator’s website when Ms. Putt booked the tour.  The Court cannot consider the screenshot Defendants provided in their Reply because it is undated and Plaintiffs have had no opportunity to contest its accuracy.  See Nicosia v., Inc., 834 F.3d 220, 231 (2d Cir. 2016) (“Even where a document is considered ‘integral’ to the complaint, it must be clear on the record that no dispute exists regarding the authenticity or accuracy of the document.”) (internal quotations and citation omitted); cf. Cooper-Booth Transp. Co., L.P. v. Daimler Trucks of North America, LLC, No. 5:17-cv-3884, 2018 WL 1940527, at *2 (E.D. Pa. Apr. 24, 2018) (declining to consider documents found not part of plaintiff’s pleadings because plaintiff contested their authenticity).  The Parties also appear to disagree markedly on the Agreement’s presentation on the website—Plaintiffs’ description of its placement is irreconcilable with the screenshot.  
            The Court also declines to take judicial notice of Viator’s website because it may have looked different when Ms. Putt booked her tour.  See (Mot. to Dismiss 9).   
            Footnote:   5  Although Defendants cite to it in discussing the screenshot, see (Defs.’ Reply 5–6), the Dorsett Declaration appended to Defendants’ initial Motion does not authenticate the screenshot.  Dorsett states “[i]n order to book any tour through Viator, an individual is required to agree to the Terms and Conditions.  Accordingly, Plaintiffs would not have been able to book a tour through Viator without consenting to the Terms and Conditions and forming an agreement.”  (Mot. to Dismiss Ex. B 2.)  She does not explain how an individual is “required to agree” to Viator’s terms and conditions, nor does she describe how the terms and conditions are presented on the website.”

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Ken Kirschenbaum,Esq
Kirschenbaum & Kirschenbaum PC
Attorneys at Law
200 Garden City Plaza
Garden City, NY 11530
516 747 6700 x 301