Background
Roger Tejon subscribed to Zeus Networks, an internet-based video programming platform, using an Apple iOS device. During registration, Tejon clicked a large red button to subscribe. Beneath these buttons was small, gray, hyperlinked text labeled Terms of Service, which led to a page containing a mandatory arbitration clause. Tejon later sued Zeus for violating the Video Privacy Protection Act by sharing his viewing history without consent. Zeus moved to compel arbitration, arguing Tejon consented to the terms by subscribing. The district court denied the motion, finding the hyperlink was not conspicuous enough to provide inquiry notice.
The court’s reasoning
The court applied Florida law to determine if an arbitration agreement existed. Under Florida law, browsewrap agreements are enforceable only if the purchaser has actual knowledge of the terms or if the hyperlink is conspicuous enough to put a reasonably prudent person on inquiry notice. The court analyzed the design elements, including the location of the hyperlink beneath large red action buttons, its small font size, and its dim gray color. The court found that the hyperlink was not highlighted in a contrasting color or all capital letters and was obscured by surrounding text. The court concluded that the design did not place a reasonably prudent internet user on notice of the arbitration agreement.
The dissent
A reasonably prudent person would not have missed it.
BRANCH
What it means going forward
The decision reinforces that internet service providers must design their subscription pages to clearly alert users to arbitration clauses, particularly when using browsewrap agreements. Providers cannot bury arbitration terms in small, gray text beneath prominent action buttons without risking unenforceability.
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