In Cody v. Jill Acquisition LLC, No. 25-937 (S.D. Cal. June 30, 2025), the Southern District of California declined to enforce a retail site’s terms of use and compel arbitration, holding that the plaintiff, who used guest checkout to place an online order at the retail clothing site, did not have adequate notice of the terms and the arbitration clause. This case should serve as a wake-up call for online entities to reexamine electronic contracting processes. It exemplifies how, even if a website’s visual design and its placement of the hyperlinked Terms of Use during user checkout are comparable to other presentations that have been deemed enforceable, a court could still decline to enforce online terms if the context of the transaction is not the typical e-commerce transaction between a registered customer and a retail site. In this case, the court found that by checking out as a guest without creating an account, the user was less likely to expect a continuing relationship and, therefore, the site’s notice and presentation of the terms below the “Place Order” button were not conspicuous enough in this instance to bind the plaintiff.
website terms of use
Ninth Circuit Issues Important Decision on Software Licensing Practices and Web Scraping
By Jeffrey Neuburger on
UPDATE: On September 27, 2018, the Supreme Court granted Rimini Street, Inc.’s petition for a writ of certiorari asking the Court to review part of the multi-million dollar damage award against it for costs and resolve an apparent circuit split over whether so-called “non-taxable costs” may be awarded under the Copyright Act (which allows for the recovery of “full costs”). The question presented is: “Whether the Copyright Act’s allowance of “full costs” (17 U.S.C. § 505) to a prevailing party is limited to taxable costs under 28 U.S.C. §§ 1920 and 1821, as the Eighth and Eleventh Circuits have held, or also authorizes non-taxable costs, as the Ninth Circuit holds.” On March 4, 2019, the Supreme Court ruled that the term “full costs” in §505 of the Copyright Act is limited to the six categories of taxable costs as specified at 28 U.S.C. §§1821 and 1920.
Earlier this month, the Ninth Circuit issued a noteworthy ruling in a dispute between an enterprise software licensor and a third-party support provider. The case is particularly important as it addresses the common practice of using automated means to download information (in this case, software) from websites in contravention of website terms and conditions. Also, the case examines and interprets fairly “standard” software licensing language in light of evolving business practices in the software industry. (Oracle USA, Inc. v. Rimini Street, Inc., No. 16-16832 (9th Cir. Jan. 8, 2018)).