Interesting Decision by the 9th Circuit on Enforceability of Online Terms of Service

An interesting read on December 20 from the 9th Circuit Court of Appeals on how terms of service should be displayed on websites and in apps:

Users are put on constructive notice based on the conspicuousness and placement of the terms and conditions, as well as the content and overall design of the app. Id. at 1177. For example, courts will not enforce agreements where the terms are “buried at the bottom of the page or tucked away in obscure corners of the website,” especially when such scrolling is not required to use the site. Id. (citing to Specht v. Netscape Commc’ns Corp., 306 F.3d 17, 23 (2d Cir. 2002)). Similarly, courts decline to enforce agreements where the terms are available only if users scroll to a different screen, Hines v. Overstock.com, Inc., 668 F. Supp. 2d 362, 367 (E.D.N.Y. 2009), complete a multiple-step process of clicking non-obvious links, Van Tassell v. United Mktg. Grp., 795 F. Supp. 2d 770, 792-93 (N.D. Ill. 2011), or parse through confusing or distracting content and advertisements, Starke v. SquareTrade, Inc., 913 F.3d 279, 293 (2d Cir. 2019); Nicosia v. Amazon.com, Inc., 834 F.3d 220, 237 (2d Cir. 2016). Even where the terms are accessible via a conspicuous hyperlink in close proximity to a button necessary to the function of the website, courts have declined to enforce such agreements. Nguyen, 763 F.3d at 1178-79.

Huuuge’s app is littered with these flaws. When downloading the app, the Terms are not just submerged—they are buried twenty thousand leagues under the sea. Nowhere in the opening profile page is there a reference to the Terms. To find a reference, a user would need to click on an ambiguous button to see the app’s full profile page and scroll through multiple screen-lengths of similar-looking paragraphs. Once the user unearths the paragraph referencing the Terms, the page does not even inform the user that he will be bound by those terms. There is no box for the user to click to assent to the Terms. Instead, the user is urged to read the Terms—a plea undercut by Huuuge’s failure to hyperlink the Terms. This is the equivalent to admonishing a child to “please eat your peas” only to then hide the peas. A reasonably prudent user cannot be expected to scrutinize the app’s profile page with a fine-tooth comb for the Terms.

Accessing the terms during gameplay is similarly a hide-the-ball exercise. A user can view the Terms through the “Terms & Policy” tab of the settings menu. Again, the user is required to take multiple steps. He must first find and click on the three white dots representing the settings menu, tucked away in the corner and obscured amongst the brightly colored casino games. The “Terms & Policy” tab within the settings is buried among many other links, like FAQs, notifications, and sound and volume. The tab is not bolded, highlighted, or otherwise set apart.

Here is the full decision: Decision.