Companies invest significant time drafting website terms of use with the expectation that they establish an enforceable agreement with the end user. Click-wrap agreements, where users actively check a box confirming they agree to the website terms of use, have been the gold standard for years. Even though click-wrap agreements are generally considered the most enforceable method for online terms of use, many companies choose to use a hybrid-wrap agreement, which places a link to the website terms of use near a button (for example, “Sign Up” or “Continue”) and instructs the user that by clicking the button, the user agrees to the website terms of use. The Sixth Circuit recently addressed the enforceability of hybrid-wrap agreements in its decision in Daddah v. Rocket Mortgage, where it analyzed whether there was sufficient assent from the end user. In conducting its analysis, the court noted that enforceability of a hybrid-wrap agreement requires an examination of the applicable website user interface and the way in which users interact with the website terms of use. In particular, the court focused on whether:

1. the website terms of use were presented on an uncluttered page or a page filled with items that distracted the user from the website terms of use;
2. the website terms of use were positioned near the action button that signaled acceptance or buried somewhere less obvious;
   
3. the font size, color, and styling brought attention toward or away from the website terms of use; and
   
4. the kind of interaction between the website and user was one in which the user would expect to be governed by legal terms.
   

Given the court’s holistic review of the website and presentation of the website terms of use, your company’s design choices about how to present website terms of use can make the difference between enforceable website terms of use and something a court ignores altogether.

Based on this updated guidance, you should review how your website terms of use are presented and accepted by end users to determine whether there are any improvements that could bolster the likelihood that your website terms of use would be held enforceable. We regularly counsel clients on how to structure website terms of use to maximize enforceability, and we would be glad to assist your organization.