Judge Jon S. Tigar, in the Northern District of California, denied defendants’ motion to compel arbitration. The case involved allegations that a company sent unsolicited text messages and calls to individuals listed on the National Do Not Call Registry, in violation of federal and state law. The defendants sought to compel arbitration based on their website’s terms of use, which included an arbitration clause.
Key Issue: Was the Arbitration Agreement Valid?
The central question before the court was whether a valid contract to arbitrate existed between the plaintiffs and the defendants. Under both federal and California law, a binding online agreement requires that users receive actual or constructive notice of the terms and manifest their assent. The burden is on the party seeking to enforce arbitration to prove that such an agreement exists.
The court closely examined the design and presentation of the terms of use on the defendants’ website and app. When users signed up, they were shown a statement in small, gray font at the bottom of the page: “By clicking ‘Send code’ you agree to our Super.com Terms of Use.” The “Terms of Use” was underlined and hyperlinked, but not otherwise distinguished.
The court found this notice inadequate for several reasons:
- The font was smaller than any other text on the page and in gray, making it difficult to see.
- The hyperlink was not colored or bolded, failing to signal its importance or interactivity.
- The notice was placed far below the main action button and could be obscured by a user’s keyboard.
- The design did not capture sufficient identifying information to evidence user assent.
Comparing this design to other cases where courts found online notices sufficient, the court noted that more effective notices used bolding, color (typically blue), capitalization, and placement adjacent to the action button. The defendants’ approach did not meet these standards.
AMBER FERRELL, et al., v. SNAPCOMMERCE HOLDINGS, INC., et al., No. 25-CV-03160-JST, 2025 WL 3280992 (N.D. Cal. Nov. 25, 2025).
