4 Scary Terms of Service You'll Click Anyway
"They're usually unreadable, filled with legalese, and consumers have little motivation to read the entire thing," says Hanni Fakhoury, a staff attorney for the Electronic Frontier Foundation, a digital rights advocacy organization.
Unfortunately, clicking that button is legally tantamount to signing a contract. The EFF noted in a 2009 white paper that American courts have generally held such "clickwrap" agreements to be legally enforceable contracts so long as consumers are presented with the agreement and required to click or check off that they read it. (By contrast, "browsewrap" agreements, in which terms of service are simply available for viewing somewhere on a Web site, have been held to more scrutiny in courts.)
But while consumers tend to treat these agreements as mere formalities, companies use these long documents to tip the scales in their favor in various ways, indemnifying themselves against legal liabilities and getting consumers to surrender privacy and intellectual property rights.
Consumers usually aren't given the option of negotiating the terms of the agreement: You either click "agree" or you don't get to use the service or software. Still, if you value your rights to the point that you're willing to forgo the use of the service in question, there are certain terms that should make you think twice about checking the "agree" box. Here are a few of the more egregious ones: Binding arbitration and class-action bans
When a group of consumers feels collectively wronged by the actions of a company, their best course of action is usually to file a class-action lawsuit, which saves the individual consumer the time and money it would cost to hire their own lawyer and litigate individually.
Such suits are expensive for a company to defend against, which is probably why many companies use terms of service and end-user license agreements to quietly relieve consumers of their rights to class-action suits. So-called forced arbitration clauses simultaneously compel users to give up their rights to participate in a class-action lawsuit and consent to an arbitration hearing to resolve any conflict.
Such terms used to be illegal in some states.
"States like California and Washington held that class-action bans within forced arbitration clauses are unconscionable, which means that they're harmful to consumers, deny people legal rights and let companies off the hook," explains Christine Hines, consumer and civil justice counsel for Public Citizen, a consumer advocacy group. But that all changed with last year's U.S. Supreme Court decision in AT&T v. Concepcion , which held that the federal law pre-empted state laws and made such clauses legal.