By Gina F. Rubel
Special to the Legal
According to the attorneys at Griesing Law, a website's terms of service (sometimes abbreviated ToS or called terms of use) are the rules and disclaimers that users must agree to in order to use a company's website. Terms of service should not be legal boilerplate, but rather should contain custom legal language informed by your company's business model.
Terms of service provide significant legal protections and are meant to form a binding legal contract between the owner of a website and the site's users. Often, such terms will include permissible use of the website, where the company can be sued, limitations on liability, modifications to statutes of limitations and choice of law. Accordingly, they should be carefully drafted. However, well-written and thought-through terms of service are not enough. Under the law, businesses must also make sure that users have "actual knowledge" of the terms and a "meaningful opportunity" to review them before they are enforceable.
Online retailer Zappos learned this the hard way after hackers stole its customers' private information and a number of those customers filed class actions against the company. Zappos’ terms of use included a provision requiring that all claims against it be resolved through arbitration and restricted class actions. However, Zappos’ terms were easy for website users to overlook and the court refused to enforce them. Using Zappos as a guide, and according to Dina Leytes, there are five ways to increase the likelihood that a court will consider your company's terms of service fair to users and enforceable:
1. Use clickwrap not browsewrap terms.
Courts typically enforce terms contained in a "clickwrap" as opposed to "browsewrap." A browsewrap agreement simply states that by browsing the site, website users agree to the website's terms of service. Zappos attempted to bind its users with a browsewrap agreement. In most cases, the better choice is to have clickwrap terms, which require users to affirmatively assent to the terms of service by clicking an "Accept" button before they can create an account or make a purchase through the website.
2. Make the terms conspicuous.
The court faulted Zappos for using a link to its terms that was inconspicuous, buried in the middle or bottom of every Zappos webpage among many other links. The link was the same font, size and color as most other insignificant links, so it was easy for the court to envision users visiting the site and never even noticing the terms. Avoid this problem by setting the link to your terms of service apart from other links on your website, and in a larger font size and different color. Within the terms of service, make significant provisions like an arbitration clause bold, capitalized or both.
3. Keep terms out of pop-ups.
Providing users a "meaningful opportunity" to read the terms of service does not require that users actually read the terms, only that users be given the opportunity to read them. Avoid using a pop-up as a device for making users view the terms of service. This practice is likely to backfire. Many users have a pop-up blocker set on their browsers, so the terms of service will go unseen.
4. Require users to scroll before clicking "agree."
The Zappos website did not direct users to its terms of use when creating an account or making a purchase. Requiring users to also scroll through the terms before agreeing to them provides further evidence that users had a fair chance to review them.
5. Do not be unfairly one-sided.
All contracts require some mutuality of obligation to be enforceable. Yet the Zappos terms of service gave Zappos the sole right to change its terms, including the arbitration clause, at any time and without notice to its users. Thus, while the terms bound users to arbitration in Nevada, they gave Zappos the right to demand users to arbitrate or litigate when and where Zappos saw fit. The court ruled that this provision made the entire terms of use an illusory contact and therefore none of the provisions were enforceable. A "savings clause" may help maintain enforceability if the terms contain an arbitration provision and you also wish to reserve the right to litigate claims. A savings clause states that while the business reserves the right to litigate, if a website user brings a claim for arbitration, the business cannot then modify the arbitration clause after the fact to avoid that arbitration.
Proving Website Users Had Notice of Terms of Service
In addition to these precautions, it is helpful to consider other ways you may prove to a court that users had notice of and consented to the terms. Since websites are constantly updated, keep copies of previous versions of your website in case you must prove enforceability against a user who consented to a prior iteration of your terms of service. The law in this area is constantly developing. Website terms of service should be reviewed periodically to ensure that they are enforceable. And don’t forget that law firms have an obligation to maintain copies of their marketing for a certain number of years, which in Pennsylvania is two years.
In addition to terms of service, websites that collect or track information about users should also have a privacy policy.
Gina F. Rubel is the owner of Furia Rubel Communications Inc., an integrated marketing and public relations agency with a niche in legal marketing. A former trial attorney, she is the author of Everyday Public Relations for Lawyers. Rubel and her agency have won many awards for legal communications, PR, media relations, website and graphic design, strategic planning, corporate philanthropy and leadership. She maintains a blog, is a contributor to National Law Review, The Legal Intelligencer Blog, AVVO Lawyernomics and The Huffington Post. You can find her on LinkedIn or follow her on Twitter. For more information, go to www.FuriaRubel.com.
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