What You Need To Know
- The Ninth Circuit upheld a district court decision that rejected JustAnswer’s argument that it provided clear notice of its terms of service through a sign-in wrap agreement on its website.
- The ruling marks the second instance in two months where the court appeared to take a stricter view on how online user agreements are presented.
- The court again criticized the presentation of the terms, noting issues with its small font, location, and lack of clear relation to the action button text.
- Companies may consider implementing changes to their sign-in wrap agreements to align with practices that are viewed more favorably by the Ninth Circuit.
- However, one of the Ninth Circuit panelists wrote a separate opinion encouraging the Ninth Circuit to revisit its prior opinions and adopt a “more sensical approach.”
On April 15, 2025, the Ninth Circuit issued a second decision in less than two months regarding the enforceability of a “sign-in wrap agreement,” which links users to a website’s terms of service.
The Ninth Circuit affirmed the district court’s ruling in Godun v. JustAnswer LLC, finding that the sign-in wrap agreement on the JustAnswer website was not an enforceable contract because it did not provide reasonably conspicuous notice and unambiguous manifestation of assent. In doing so, the Court relied on similar reasoning as when it reached a similar conclusion on February 27, 2025, in Chabolla v. ClassPass.
In addition to the insights from ClassPass, the majority opinion in JustAnswer provides further takeaways for businesses to consider when designing online user agreement processes.
Background
JustAnswer moved to compel several plaintiffs to arbitrate their claims against it, arguing that plaintiffs were bound by the arbitration agreement in the terms of service to which they agreed when signing up for an auto-renewing JustAnswer subscription.
Judge James Donato in the Northern District of California considered four separate payment screens, which the plaintiffs encountered at different periods of time.
Screen 1 – seen by plaintiff Davis
Screen 2 – seen by plaintiff Nelson
Screen 3 – seen by plaintiffs Godun and Faust
Screen 4 – seen by plaintiff McDowell
The court held that notice of the JustAnswer terms of service was not sufficiently conspicuous on the four webpages that certain plaintiffs saw during the sign-up process, and that other plaintiffs could not have unambiguously manifested their assent to the terms through the webpages they encountered. Because the terms did not represent an agreement between the plaintiffs and JustAnswer, the court denied the motion to compel arbitration and JustAnswer appealed the decision.
Federal Appeals Court Upholds the Decision
The Ninth Circuit held that the payment screens either did not provide plaintiffs with reasonably conspicuous notice of the terms of service or did not require the plaintiffs to take sufficient action that unambiguously manifested their assent to the terms.
As to reasonably conspicuous notice, the Ninth Circuit held:
- Screen 1 did not put plaintiff Davis on notice because the notice text was “relatively small,” not close enough to the action button, and in a “hard to read” light gray color which “blend[ed] into the background.”
- Although the text color issue was cured in Screen 2, it did not put plaintiff Nelson on notice because the text was still “relatively small” and not close enough to the action button.
As to unambiguous manifestation of assent, the Ninth Circuit held:
- Screen 3 and Screen 4 were ambiguous because the language on the action button (“Connect now”) did not match the notice language about the terms of service above the action button. Thus, plaintiffs Godun, Faust, and McDowell did not assent to the terms when clicking “Connect now.”
Therefore, the Ninth Circuit panel held that the plaintiffs either did not receive reasonably conspicuous notice of the terms of service or did not unambiguously manifest assent to those terms when signing up for an auto-renewing JustAnswer subscription. The arbitration agreement in the terms of service was therefore unenforceable against them.
What’s Next
Like the panel in ClassPass, the JustAnswer panel focused on the color and readability of the notice text, the placement of the notice text with respect to the action button, and whether the notice language indicates to the user what action (like clicking “Connect now”) would constitute assent. Thus, websites using sign-in wrap agreements may want to consider implementing changes consistent with these recent opinions.
However, in the JustAnswer decision, the Ninth Circuit stated that, through this and other opinions, it had not “created a checklist for website designers” or “generated per se design rules that must be followed for a contract to be formed between a website user and provider.” Thus, the court decried any insinuation that its opinions create a “one-size-fits-all approach” or any “hard-and-fast rules,” and maintained that such analyses will remain fact intensive and consider the totality of the circumstances.
In a concurring opinion, Judge Nelson pushed back on the majority’s assertions, stating that the court “come[s] very close” to “demand[ing] magic words” with respect to the call-to-action language, which deviates from California law on consent.
ClassPass’s petition for rehearing was filed on April 14, 2025, and four briefs supporting the petition were filed by amici on April 24, 2025. The petition for rehearing deadline for JustAnswer is May 13, 2025.