Sea change on web-based contract amendments

The Ninth Circuit sounds really right on this:

Service providers should not be able to change their terms of service arbitrarily without notifying their registered users, according to the judges in the US Court of Appeals for the Ninth Circuit. The decision on the case of Douglas v. Talk America (PDF) could affect how web site operators handle changes made to user agreements, regardless of what the user originally agreed to….

“Parties to a contract have no obligation to check the terms on a periodic basis to learn whether they have been changed by the other side,” wrote the judges. “Indeed, a party can’t unilaterally change the terms of a contract; it must obtain the other party’s consent before doing so… This is because a revised contract is merely an offer and does not bind the parties until accepted.”

This is huge. I believe that unlike many other Ninth Circuit wonders, this eminently sound rule of law will be adopted in other circuits. Meanwhile, the Ninth Circuit is pretty important in and of itself. So send this link to a lawyer you know, especially one who represents businesses (such as web hosting companies and ISP’s) that form real business contracts over the web on a regular basis.

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Author:Ron Coleman

I write this blog.

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