Are the Hyatts bound by the contract terms specified on Cyber Tool’s “Terms of Service” page that they did not read? Which of the required elements for contract formation might the Hyatts’ claim lack? How might a court rule on this issue?
Ted and Betty Hyatt live in California, a state that has extensive statutory protection for consumers. The Hyatts decided to buy a computer so that they could use e-mail to stay in touch with their grandchildren, who live in another state. Over the phone, they ordered a computer from CompuEdge, Inc. When the box arrived, it was sealed with a brightly colored sticker warning that the terms enclosed within the box would govern the sale unless the customer returned the computer within thirty days. Among those terms was a clause that required any disputes to be resolved in a Tennessee state court. The Hyatts then signed up for Internet service through Cyber Tool, an Internet service provider. They downloaded Cyber Tool’s software and clicked on the “quick install” box that allowed them to bypass Cyber Tool’s “Terms of Service” page. It was possible to read this page by scrolling to the next screen, but the Hyatts did not realize this. The terms included a clause that stated that all disputes were to be submitted to a Virginia state court. As soon as the Hyatts attempted to e-mail their grandchildren, they experienced problems using Cyber Tool’s e-mail service, which continually stated that the network was busy. They also were unable to receive the photos sent by their grandchildren.