Judge Can’t Decide if Facebook’s User Agreement is a Browsewrap, But He Enforces It Anyways–Fteja v. Facebook

By Eric Goldman

Fteja v. Facebook, Inc.,2012 WL 183896 (S.D.N.Y. Jan. 24, 2012). Fteja’s initial “complaint” (filed as an order to show cause).

If I could waive a magic wand, I’d retire the phrases “clickwrap” and “browsewrap.” Those terms trace their lineage to a radically different technology–plastic shrinkwrap on physical products–and, as a result, they never developed clean or precise definitions in the online world. This opinion is much more prolix than necessary because the court couldn’t figure out what either term meant and therefore couldn’t decide how to apply the precedent. Fortunately, the court gets to the right place eventually.

Fteja claims that Facebook terminated his Facebook account improperly because it discriminated against him as a Muslim. Facebook will win this lawsuit eventually; see, e.g., my paper about online user account terminations and 47 USC 230(c)(2) and Young v. Facebook.

For now, after removing the case from New York state court to federal court, Facebook sought to transfer the case to its home court in California. Facebook invoked the venue selection clause in its user agreement (its “Terms of Use”). Facebook uses a mandatory non-leaky clickthrough agreement where the terms are hyperlinked from the clickthrough page. (The language says: “By clicking Sign Up, you are indicating that you have read and agree to the Terms of Service,” where the words Terms of Service are a hyperlink). This user interaction should have made it an easy case. This formation process (mandatory clickthrough with hyperlinked terms) has been upheld in dozens of cases. Indeed, buried in his overlong discussion, the judge says “Fteja was informed of the consequences of his assenting click and he was shown, immediately below, where to click to understand those consequences. That was enough.”

Yet, the judge launches into an extended discourse about the philosophy of online contracts. Overly troubled by the hyperlinked presentation of the actual terms, the court reaches this awkward classification:

Facebook’s Terms of Use are somewhat like a browsewrap agreement in that the terms are only visible via a hyperlink, but also somewhat like a clickwrap agreement in that the user must do something else—click “Sign Up”—to assent to the hyperlinked terms. Yet, unlike some clickwrap agreements, the user can click to assent whether or not the user has been presented with the terms.

The judge then snarks about social media exceptionalism:

it is tempting to infer from the power with which the social network has revolutionized how we interact that Facebook has done the same to the law of contract that has been so critical to managing that interaction in a free society. But not even Facebook is so powerful.

(Don’t underestimate Facebook, your honor. It is changing our brains).

Despite all the navel-gazing, the judge realizes:

There is no reason why that outcome should be different because Facebook’s Terms of Use appear on another screen rather than another sheet of paper….The mechanics of the internet surely remain unfamiliar, even obtuse to many people. But it is not too much to expect that an internet user whose social networking was so prolific that losing Facebook access allegedly caused him mental anguish would understand that the hyperlinked phrase “Terms of Use” is really a sign that says “Click Here for Terms of Use.” So understood, at least for those to whom the internet is in an indispensable part of daily life, clicking the hyperlinked phrase is the twenty-first century equivalent of turning over the cruise ticket. In both cases, the consumer is prompted to examine terms of sale that are located somewhere else. Whether or not the consumer bothers to look is irrelevant.

Having convinced himself that Facebook’s venue selection clause is enforceable, the judge then concludes that transfer is proper. All of the relevant evidence is at Facebook’s headquarters, Fteja’s witnesses don’t appear to be near NYC, the alleged contract breach means the “locus of operative facts” took place in California, and Fteja’s medical condition (“Ménière’s disease”) won’t keep him off airplanes.

Some related posts:

* Court Disregards Check-the-Box Agreement and Doesn’t Enforce Venue Clause — Dunstan v. comScore

* Forum Selection Clause in “Submerged” Terms of Service Presumptively Unenforceable — Hoffman v. Supplements Togo

* Anti-Scraping Lawsuit Largely Gutted–Cvent v. Eventbrite

* Interesting Database Scraping Case Survives Summary Judgment–Snap-On Business Solutions v. O’Neil

* Clickthrough Agreement With Acknowledgement Checkbox Enforced–Scherillo v. Dun & Bradstreet

* Contract Formed Even If Customer Never Received It–Schwartz v. Comcast

* Ticketmaster Wins Big Injunction in Hannah Montana Case, But Did the Public Interest Get Screwed?–Ticketmaster v. RMG