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To Click or Not to Click – What You Don’t Know About Internet Law Can Cost You Big Time

By September 15, 2014May 6th, 2021No Comments

It used to be easy to prove up a contract. Someone sells you a horse or a car or a boat – you sign on the dotted line – and the money and merchandise change hands. But what happens when you buy something online? Are you bound by the language in those incomprehensible electronic agreements which pop up? Who reads them anyway? If you just push the “Agree” button and move on – you are not alone! But read on before you click your rights away!

1. Beware of Online Agreements! Online agreements can be enforceable depending upon how they are set up. The key issue is whether the terms of the agreement are conspicuous and not disguised in the fine print. If a key term is in the regular font of the agreement and not highlighted, it can be construed as an “adhesion contract” and unenforceable. An example would be a provision that requires you to file a suit in a remote state for a problem – say Alaska. You got a good shot at knocking that problem out of the park! However, merchants are getting smarter – read on!

2. Think before you Click! Older online agreements which are still on the web allow you to scroll to the bottom and click “agree”. Although your decision to click away can create a binding contract, many courts do not enforce these online agreements if they contain complex terms that are difficult for a layperson to understand or even spot. However, some of these online agreements have evolved to address this concern and better assure enforceability. In the typical online newer version, you are asked to click several times throughout the document. The theory is that the user had every opportunity to spot the contract language but decided to go for the prize at the end. These agreements are far more likely to be enforced so beware.

3. Keep It Simple Silly! There is a world of difference between buying an old book on eBay and entering into an online agreement to sell an original poem, artwork, or song. You can easily give up your ownership in the creative work (known as intellectual property rights) by improperly entering into an online agreement. If it is a simple purchase – you are probably OK. If the deal is more complex than a simple purchase, get legal advice before clicking your rights away.

4. Business Owners are Exceptional – If you are operating your own e-commerce site, you should get the advice of an experienced IP attorney. Without proper legal terms in your online agreement, you could find yourself being sued anywhere your site is accessed if a deal is concluded. The legal term is that such interface with a consumer results in “minimum contacts”. You can limit the ability of a third party to file suit against your company for damages and even the location or “venue” where a lawsuit can be filed. This is a complex area of the law known as IP Law or eCommerce Law. Best to get advice before diving in.

BOTTOM LINE: The laws which apply to online contracts are complex and in a state of legal flux. If you are contemplating a complex transaction online, definitely get legal advice before clicking your rights away. Same advice if you are on the other side and operating the e-commerce merchant site.