Tuesday, April 6, 2010
Back in 2008, we reported on how Curtis Bridgeman and Karen Sandrik think a lot of business-to-consumer form contracts are “bullshit,” which is a technical philosophical term referring to illusory promises. I often begin my contracts course by walking my students through Google’s Terms of Service agreement in order to alert them to the hazards of click-through agreements. Tradecomet.com LLC v. Google, Inc. reveals that things are not very different in the B2B context. In a March 5, 2010 opinion, Judge Stein of the Southern District of New York dismissed Tradecomet’s action, ruling that the parties were bound by a forum selection clause in their August 2006 agreement. Tradecomet will have to bring its antitrust claims in California.
The forum selection indicates Google’s vast advantages in terms of bargaining power. Not only does it specify that the agreement will be governed by California law and that all disputes must be litigated in Santa Clara County, California, it also specifies that “THE AGREEMENT MUST BE CONSTRUED AS IF BOTH PARTIES JOINTLY WROTE IT.” Obviously, both parties did not write it, and presumably Google insists on this whopper in order to avoid legal consequences such as claims of procedural unconscionability and contra proferentem construction.
That forum selection clause was added to the parties agreement in August 2006 and Tradecomet argued that it should not govern because the alleged antitrust violations occurred when the parties were operating under earlier versions of their agreement, dated April 19, 2005 and May 23, 2006. Both earlier versions contained language providing that “Google may modify the Program or these Terms at any time without liability and your use of the Program after notice that the Terms have changed indicates acceptance of the Terms.” The August 2006 Agreement also provides that it “supersedes and replaces any other agreement, terms and conditions applicable to the subject matter hereof.”
The court found that Tradecomet accepted the terms of August 2006 by clicking through text. Tradecoment contended that enforcement of the forum selection clause would be unconscionable, but the court found that doing so would be neither unreasonable nor unjust.
Wait a minute, shouldn't the case be renamed Tradecomet.com v. Topeka?