Hello folks and welcome to the first edition of Digital Thrive’s Let’s Dig Into Compliance!
Its me, Puja Amin, General Counsel of Digital Thrive—better known as the great and powerful Queenie of TCPAWorld—and I’ll be your hostess for this monthly publication.
So let’s jump right in. You already know Digital Thrive as one of the top supplier of TCPA COMPLIANT leads in the insurance vertical (and soon to be mortgage) but you’ll soon know us as one of the top suppliers of industry related news and views.
This month I want to focus on a critically important case out of the Ninth Circuit Court of Appeals called Berman that helps all of us better understand what sorts of things are needed in terms of the content and format of online disclosure forms.
Setting the stage, the Court of Appeals is a higher court—which means that all of the lower courts in California, Nevada, Washington, Arizona, Utah and Idaho have to follow what the Ninth Circuit says. Other Circuit Courts of Appeal around the country are also more likely to follow what the Ninth Circuit said in Berman.
In Berman the issue was whether an arbitration provision accepted by a consumer on a website run by Fluent—generally known to be pretty good guys in the industry—gave the consumer sufficient notice of the arbitration terms to be enforceable. And while Berman was focused on arbitration, the same rules the court applied regarding arbitration clauses pertain to ALL forms of online disclosures—including Express Consent.
The Berman court determined that only disclosures that give a consumer “reasonably conspicuous” disclosure of the terms can be enforced. Hence, the Court found, disclosures that make use of “tiny” language that does not stand out in the overall format of the website is insufficient.
To help you visualize the issue, here are the forms that the Court looked at in Berman:
And
As you can see, the language here isn’t really that small. It stands out pretty well against the white background. But the Court found that this fine print was just too fine to be binding. The terms had to be a bit bigger.
Additionally, the use of hyperlinks to identify important terms was ok but the Ninth Circuit took issue with the fact that the hyperlinks were not BLUE. It may seem strange that a Court of Appeals with three talented and experienced judges would nitpick the disclosure to this degree, but it is great for everyone to keep this pointer in mind—hyperlinks must be blue!
But there is one last piece of Berman that a lot of people seem to be missing but that I think is critically important. The Court found that the buttons at issue—one saying “continue” and one saying “this is correct, continue” did not sufficiently alert the consumer that terms were being accepted. As the Court explained it, consumers may be bound by terms on a website or in a hyperlink—even if they do not read them—but only if they know or should have known they are accepting those terms by clicking the button. Where a button just says “continue” that does not alert a consumer that any final and binding terms are being accepted.
The Berman court goes so far as to give us suggestions as to what might actually work: “By clicking the Continue>> button, you agree to the Terms & Conditions.” While that would certainly work, it also seems like overkill to this observer. Still, the presence of an asterisk or some other clear indication that terms are being accepted when the button is clicked should be deemed critical following Berman.
In the end, the performance marketing/digital lead generation industry continues to operate without clear standards as to what does—and does not—constitute a valid disclosure. While Berman does not completely answer the question it provides one CRITICAL lesson for everyone in this industry to keep in mind: the Courts are paying attention to the details of webforms and are NOT going to enforce disclosures that are not conspicuously presented to, and fairly accepted by, the consumer.
In terms of specifics:
Make sure your font color has clear contrast against the background and that the font is clearly readable in size—don’t make it so “tiny” that a consumer might miss it.
All hyperlinks must be blue.
The content and layout of the website should CLEARLY advise a consumer that by clicking a button they are accepting terms and conditions. A radial button is not strictly required, but a consumer must be clearly advised that they are manifesting their consent to terms at the time they click the button.
Well there you go folks, hope you enjoyed. More content again next month. Stay tuned.