When Terms Of Use Are A Can Of Worms

For a company that needs to formulate its terms-of-use, there is a tradeoff between between browsewrap and clickwrap. An article by Venable attorney Kimberly Culp looks at this issue as it applies specifically to app developers, but what she says applies more widely to many businesses with a digital presence. Terms of use properly formulated, she writes, can help a company avoid litigation, in particular class action litigation, and it can increase the chance for a favorable venue if litigation does ensue. It may even allow for a loser-pays provision. But it won’t do anything if it is not enforceable by the courts, The problem: Whether terms of use are enforceable is largely a function of how they are presented. Courts are more likely to be receptive to clickwrap, but clickwrap is “more cumbersome to the consumer and more burdensome to the company.”