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Three Need-To-Knows About Website Legal Agreements

By | Jun.30.15 | Client Service, Communicating, Daily Dispatch, Law Practice Management

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If you have clients that do business online, you most likely have been called upon to prepare various website legal agreements. Depending on the website, you may be drafting Terms of Use, Privacy Policies, or other types of agreements.

Before you fire those agreements off to your client in an email, there are some key questions to ask:

  • How and where are those agreements presented on your client’s website?
  • What actions must a website user take to accept those agreements on your client’s website?
  • How does your client track and prove who is agreeing to what and when they agreed?

The answers to these questions can make or break the enforceability of even the most thoughtfully drafted agreements — a problem that has plagued companies like Zappos.com, GoGo Internet and Trans Union. Below are three tips to assist you in advising your clients on this critical issue.

1. For clickwraps, it’s all about notice and asset. As you probably know, a “clickwrap” agreement is a type of website legal agreement that is intended to be accepted when a user clicks on some element of a webpage (usually a checkbox or a button). Courts typically look at two primary factors when determining the enforceability of a clickwrap agreement: (1) did the user have reasonable notice of the terms of the agreement, and (2) did the user manifest acceptance of the agreement. This is not as straightforward as it seems and can be tricky to implement from a technical perspective. These best practices can be followed to help your clients create enforceable clickwraps:

  • Be sure to provide conspicuous presentation of website legal agreements during clickable transactions with users.
  • There should be clear notice that acceptance of the website legal agreement is required before proceeding.
  • There should be a clear action by the user to manifest acceptance of the agreement. The best option here is typically a checkbox along with a statement that checking the box indicates acceptance.
  • The user should have an obvious opportunity to review the website legal agreements.

It is worth noting that if you accept client engagements via a virtual law office or client portal, these practices should be followed by you as well!

2. For browsewraps, it’s all about constructive notice. Unlike a clickwrap agreement, where the user accepts a website legal agreement by clicking a button or checkbox, a browsewrap agreement provides for no such express acceptance. Instead, the user implies acceptance by simply browsing the website.

For a browsewrap agreement to be enforceable, the user must have actual or constructive notice that: (1) the browsewrap agreement exists; and (2) that their use of the website binds them to the terms of the agreement. In other words, if they are unaware that the agreement exists or why it exists, it can’t be enforced.

Here are some best practices that you can provide to your clients to increase the likelihood of browsewrap agreement enforceability:

  • Links to the browsewrap agreement should be prominently displayed. If a user must scroll to the bottom of the webpage in order to see a link to a browsewrap, it probably isn’t enforceable.
  • Make sure the link to the browsewrap is immediately visible when a webpage opens in a browser window.
  • Make the link conspicuous — larger, different font, color, etc. — to differentiate it from other links and content.
  • A link alone might not be enough. There should be notice that a user would be bound by the website legal agreements by using the site.

3. Don’t forget about record keeping. Proving what someone actually agreed to on a website can become a technical hassle if not planned for ahead of time. Clients need to keep good records of all the data and information related to their website legal agreements. Your clients should be keeping track of versions, dates revisions to agreements are published, and dates that users accepted a particular version of an agreement. Clients should also establish a procedure for providing and verifying the technical proof that agreements were actually accepted by a user.

Brian Powers is an Indianapolis-based lawyer and entrepreneur. Brian has practiced Internet law for nearly a decade, working with start-ups and companies that transact business online. He recently launched PactSafe, a cloud-based solution that manages, tracks, deploys and enforces digital legal agreements. Brian tweets @PactSafe.

No content provided in this post is to be construed as legal advice, nor should it be construed as a substitute for the advice of an attorney.

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