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The issue of the validity of Clickwrap License

 The district court held that the additional terms were unenforceable as a matter of law because Zeidenberg never assented to them. The court of appeals, however, determined that the additional terms were enforceable. The court first recognized that placing all the contract terms on the outside of a box would be impractical. They think that shrinkwrap license included with computer software was binding on buyer under Uniform Commercial Code; seller proposed contract that buyer could accept by using software after having opportunity to read license at his leisure, and buyer could have prevented formation of contract by returning software. U.C.C. § 2-204(1). They refer to § 2-606 to show that the opportunity to return goods can be important; acceptance of an offer differs from acceptance of goods after delivery, but the UCC consistently permits the parties to structure their relations so that the buyer has a chance to make a final decision after a detailed review. Because Zeidenberg had the opportunity to return the software to the store and get his money back if the additional terms were unacceptable and did not choose to do so. The court concluded that a transaction in which the money was exchanged before detailed terms were communicated ("pay now, read later") was valid. This holding is in line with traditional contract law, which considers acceptance to occur when a buyer does not "make an effective rejection" after having "a reasonable opportunity to inspect" the goods.
 B. Specht v. Netscape Communications Corp .
 The latest case was Specht. In Specht, the court held that internet users cannot be bound by a license agreement mandating arbitration when the terms are not called to the attention of the recipient.
 Defendant Netscape provided the software program "SmartDownload" on its website at no charge which invaded plaintiffs’ privacy by clandestinely transmitting personal information to the software provider when plaintiffs employed the plug-in program to browse the Internet. Visitors clicked on a box indicating a desire to download the Netscape software. There is a link on the specific webpage where the downloading took place, which read: "Please review and agree to the terms of the Netscape Smart-Download software license agreement." This link was visible only if the visitor scrolled down the webpage. Netscape did not require visitors to click on an "I accept" button or otherwise indicate their acceptance to the license agreement before they were able to download the "SmartDownload" software. Netscape argued that downloading the software indicated assent to the license on Netscape’s website. The district court held that Netscape failed to provide sufficient notice of its license and consequently, found that the plaintiffs did not assent to the browsewrap license. The appeal court held that "Reasonably conspicuous notice of the existence of contract terms and unambiguous manifestation of assent to those terms by consumers is essential if electronic bargaining is to have integrity and credibility."


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