The court set these arguments aside because Uber requires users to “click” to assent to the contract, thus Uber’s terms are clickwrap rather than browsewrap. Courts consider terms of service “browsewrap” if the terms are tucked away in a link at the bottom of the webpage. Browsewrap is generally unenforceable because the consumer did not “click” to agree. Clickwrap is the opposite – a box pops up and the consumer must click to agree. Courts usually find that clickwrap is enforceable because the consumer took a physical step to agree to the terms by “clicking” on the box.
Here, however, even though the Court determined that Uber’s Terms of Service is Clickwrap, the Court observed a different issue with the Terms. Metter’s fourth argument, arguably a pretty unique one – caught the court’s attention: when the keypad popped up for Metter to enter his credit card information, it blocked the terms of service alert, preventing him from seeing it, thus preventing him from agreeing to the terms. Since Metter did not see the terms because of the pop-up, he could not have agreed to them. Thus, the Court dismissed Uber’s motion to compel arbitration.
From the opinion:
“For one thing, Uber never explains why Metter would have scrolled down to find a terms of service alert he was not otherwise aware of, especially when the registration and payment screen neither instructed him to scroll down nor presented any reason for him to do so. Moreover, although it is true that the terms of service alert would have been visible to Metter when he first reached the payment and registration screen, it would have been obscured immediately when Metter pressed any field asking for his credit card information.”
The Court also notes that the screen seems designed to indicate that a consumer should enter their credit card information right away without scrolling down, because the credit card field is at the top and the terms of service are at the bottom.
“As these fields are at the top of the screen, and entry of payment information is one of the primary purposes of this page, the Uber app essentially prompts a user to enter his credit card information as soon as he reaches the payment and registration screen. As a result, an ordinary registrant will often be compelled to activate the pop-up keyboard and obscure the terms of service alert before having the time or wherewithal to identify other features of the screen, including the alert.”
Finally, the Court ends its analysis with the foundations of contract law, that no contract can exist if there is no acceptance of the contract.
“When such a registrant presses “REGISTER” without having seen the alert, he does so without inquiry notice of Uber’s terms of service and without understanding that registering is a manifestation of assent to those terms. Although the terms of service alert seems designed to put a registrant on inquiry notice of Uber’s terms of service and to alert the registrant that registration will amount to affirmative assent to those terms, the keypad obstruction is a fatal defect to the alert’s functioning.” (emphasis added.)
It’s interesting that the court relied on the keypad obstruction since arguably, the keypad obstruction is out of Uber’s direct control. Should lawyers start thinking like designers and advising clients how to design apps to alert users to terms and conditions? This decision indicates that lawyers should.
How will the display of terms and conditions continue to change as our devices change – how will terms and conditions be displayed on smart watches or VR headsets? It depends on how the consumer interacts with the device to assent to the terms.
Native Apps versus Web-based Apps
An important distinction in this case – although the court does not mention this distinction specifically—is that the functionality question likely turned on the fact that the Uber App is a native app rather than a web based app. A native app is one that a user has to download onto their phone. It’s easy to incorporate clickwrap into a native app because a programmer can include an opening screen that requires the user to click to agree.
A web based app is the mobile view of a website when accessing a website through a mobile phone. It is a little more difficult for programmers to incorporate click wrap into a web based app, since pop-up screens are not well suited for mobile internet browsers.
Focusing on the phones of today for a moment, let’s pull out some key pointers on developing terms and conditions for apps, applying some of the wisdom from this opinion.
- First, the terms and conditions alert should always be visible before a user clicks “register” or “agree.” Web designers should put the terms and conditions alert at the top of the screen – before the user enters their credit card information.
- When developing web apps or native apps, the app owner should test the web app on an actual mobile phone (rather than a website that mimics the “look” of a mobile phone) because the owner must understand how a pop-up keyboard will interact with the web app.
As modern technology evolves, lawyers, website owners, programmers, and designers must evolve with it. What has worked in the past as far as web design and modern day “contractual agreements” may not work on tomorrow’s hardware.