The FTC complaint, which was made public on March 8, stated that LifeLock's credit protection service actually consisted of the following elements: placing an Initial Alert on its customers' consumer reports with credit reporting agencies, obtaining and providing its customers with copies of their free annual credit reports, and submitting requests on its customers' behalf to remove their names from lists of prescreened offers of credit.

According to the FTC, these steps did not prevent identity theft and did not provide many of the protections LifeLock promised. While an Initial Alert can provide notice to businesses that someone may be impersonating another, it is only useful if the business accesses the consumer's credit report as part of the transaction - something that generally only occurs where a consumer opens a new account. According to the FTC, "Alerts do not protect against more common types of identity theft, such as misuse of an existing credit account . . . medical identity theft, employment-related identity theft, or using another's identity to evade law enforcement." An Initial Alert would also be highly unlikely to prevent wire transfer fraud, since financial institutions do not check credit reports before initiating wire transfers.

The FTC charged that LifeLock falsely claimed that its ID theft prevention service made customers' personal information useless to thieves and prevented unauthorized changes to customer address information. It also charged that LifeLock failed to take appropriate security measures to protect sensitive data that customers provided to LifeLock itself.

On March 9, LifeLock and Davis entered into a Stipulated Final Judgment and Order for Permanent Injunction to settle the FTC's claims. In this order, the defendants did not admit to the allegations in the FTC complaint. However, they did agree to an injunction prohibiting them from engaging in the activities charged in the FTC complaint, including, "misrepresenting" that its ID theft program "provides complete protection against all forms of identity theft by making customers' personal information useless to identity thieves."

The case is a class action entitled Keller v. Electronic Arts, Inc., Northern District of California, No 4:09-cv-01967. Electronics Arts, which is based in the Los Angeles area, is the world's largest manufacturer of videogame software. In 2009, its gross revenues exceeded $4 billion on the strength of titles such as Madden NFL. Among its many sports titles is NCAA Football, a game which enables players to recreate football matches between college teams.

According to the complaint, EA designs NCAA Football to include characters that resemble real-life college athletes. The virtual players "share the same jersey numbers, have similar physical characteristics and come from the same home state." While EA omits the players' names, game users allegedly can "access online services to download team rosters and the athletes' names and upload them into the games." The complaint further charges that in recent versions, EA has included features to facilitate the upload of this data.

The complaint alleged that EA's actions violated the players' rights of publicity. California law contains both statutory and common law causes of action for violation rights of publicity. California's right of publicity statute provides that "any person who knowingly uses another's name, voice, signature, photograph or likeness, or in any manner, on or in products, merchandise, or goods . . . shall be liable for any damages sustained by the person or persons injured as a result." Cal. Civ. Code § 3344(a).

Electronic Arts conceded that the allegations in the complaint stated a claim for violation of their rights of publicity. However, EA countered that the players' rights of publicity claims were barred by the doctrines of transformative use and public interest use and a statutory "reporting" exception.

Judge Wilken disagreed.

David D. Johnson
Epstein, Becker & Green
One California Street
26th Floor | San Francisco, CA 94111
(415) 399-6032 (direct)
DJohnson@ebglaw.com

Epstein, Becker & Green is a national firm with prominent practices in litigation, health care, science and technology, labor and employment, real estate, hospitality, financial services and energy law. For more details, see our firm website at www.ebglaw.com.

I'm excited to be able to practice in the beating heart of the Internet industry and plan to continue to specialize in cases involving Internet, science, technology and health law.

Look for my next Digital Media Lawyer Blog post soon!

David Johnson

We have frequently written about the differing standards that courts use when confronted with a request from plaintiffs to uncover the identity of the anonymous author of material posted on the Internet. The right to speak and write anonymously is protected by the First Amendment of the U.S. Constitution -- and to an even greater extent by some State constitutions. However, the extent of the right to anonymous speech varies based on the content of the speech. At one end of the spectrum, the author of purely political anonymous speech may be given absolute protection against disclosure of his identity. At the other end, the author of defamatory speech may ultimately be given no protection from disclosure at all, since defamatory speech is considered unprotected under the U.S. Constitution. Fn1

While certain types of speech, such as defamation, may get little or no protection, a court considering a complaint is not in a position to know whether the allegations have any merit. There is always a danger that the allegations will prove untrue, or that the defendant will be able to establish a valid affirmative defense. As such, to protect the rights of anonymous authors, courts around the U.S. generally require a plaintiff to show that their claims have at least some level of merit before being permitted to discover the identity of the anonymous author of the speech at issue.

These standards can vary greatly from court to court. Some courts impose what we have termed a "light" standard, and merely required the plaintiff to show that his complaint would withstand a motion to dismiss or that it was filed in "good faith." This light standard was applied in the recent Liskula Cohen case. See In re Liskula Cohen, Supreme Court of the State of New York, County of New York: Part 11, Index No. 100012/09. While this test has different labels, it ultimately merely requires the plaintiff to show that his complaint meets pleading standards -- no evidence or proof is required.

It is a fundamental tenet that privacy rights are personal and only the person whose privacy has been invaded can sue to recover damages for a breach. This means that if the victim has died, his relatives may not bring a claim for invasion of the victim's privacy either by suing personally, or on behalf of the deceased's estate. Fn2 As the law treatises put in -- there is no "relational right" to bring a claim for invasion of privacy. Fn3 Among the reasons for this limitation is a general judicial wariness towards claims of pure emotional injury, and concerns about permitting plaintiffs to gain a double recovery. Fn4.

However, courts have permitted relatives to recover where the breach also constituted an invasion of their own privacy rights. For example, in Vescovo v. New Way Enterprises, Ltd., the defendant ran a classified ad in an L.A. paper touting "Hot Lips --- Deep Throat Sexy young bored housewife Norma" and giving plaintiff Norma Vescovo's address. The California Court of Appeal permitted not only Norma, but also her 14 year old daughter, to bring claims for invasion of privacy. This was because the ad had resulted "in excess of 100 persons" coming to the Vescovo's home, day and night, "demanding to see Norma, creating disturbances, and using lewd, abusive and threatening language" and "in excess of 150 motor vehicles stopp[ing] in front or cruis[ing] slowly" by the residence, and subjecting the family, including the 14 year old, to neighborhood ridicule. Because the 14 year old sought to recover for the intrusion into her own seclusion, her claim was proper. Fn5

The Catsouras case fits into this exception. The facts of the case are tragic. On October 31, 2006, 18 year old Nicole Catsouras was decapitated in an automobile accident. CHP officers arrived at the scene and cordoned off the area. They also took multiple photos of the decapitated corpse. Two CHP officers allegedly emailed copies of these "graphic and horrific" photos to members of the public who were not involved in the investigation. Once released, the photos went viral and soon appeared on more than 2.500 websites around the world.

A number of Internet miscreants then decided to use the occasion to torture the decedent's relatives. For example, her father, Christos Catsouras, received several emails containing the photographs, include one entitled "Woo Hoo Daddy" that said "Hey Daddy I'm still alive." These and other emails caused the Catsouras's severe emotional and mental distress. As a result, the Catsouras's sued the CHP on invasion of privacy and related tort theories.

However, in 2003 decision regarding the Child Online Protection Act (COPA), several Justices discussed whether this standard should be changed for cases involving material distributed over the Internet. See Ashcroft v. ACLU, 5335 U.S. 564 (2002). Two Justices, O'Connor and Breyer, stated that a "national standard" should be adopted for such cases. Justice O'Connor argued that because Internet publishers cannot control where their materials will be downloaded, using a "local community" standard would impose the most restrictive view of obscenity taken by any community in the country on them. This would "potentially suppress an inordinate amount of expression."

Seizing on Justice O'Connor's language, in 2009 the 9th Circuit held that "a national community standards must be applied in regulating obscene speech on the Internet . . ." U.S. v. Kilbride, 584 F.3d 1240 (9th Cir. 2009). In support of its decision, the 9th Circuit claimed that a majority of the justices in Ashcroft had supported adoption of a national community standard for Internet cases.

As we wrote in our November 5, 2009 post, the 9th Circuit got this point wrong. In fact, the opinion by Justice Kennedy, which the 9th Circuit counted as expressing support for a national community standard, actually stated that a national community standard was "neither realistic nor beyond constitutional doubt." Because only Justices O'Connor and Breyer expressed support for a national community standard, this means that the Supreme Court left the "local community" standard of Miller intact -- even for Internet cases. See also Kilbride at 1719 (noting that the Kilbride decision also had actually not reached the issue of national v. local community standards).

In the Layshock case, Justin Layshock, a 17 year old high school senior, created a "parody profile" of his principal, Eric Trosch, using his grandmother's computer. The profile included a photograph copied from the school district website and characterized Trosch as a habitual drunk and marijuana user, a "steroid freak", a "big whore" and a "big fag." Layshock "friended" several fellow students on the webpage. This caused news of it to "spread like wildfire" to most of the school's student body. The webpage was viewed by students in the school's online computer class, and three other students also created parody sites about Trosch.

Trosch complained to the local police and also instituted disciplinary proceedings against Layshock at the school. After a hearing, the school district found Layshock guilty of "gross misbehavior", "obscene, vulgar and profane language" and computer policy violations -- for use of school pictures without authorization. The school then imposed a ten-day, out-of-school, suspension on Layshock, placed him in an Alternative Education Program (for children who are unable to function in a normal classroom setting), banned him from all extra-curricular activities and prohibited him from participating the school's graduation ceremony. See Layshock v. Hermitage School District, 3d Circuit, N0. 07-4465, Opinion, Feb. 4, 2010).

In the J.S. case, J.S., a 14 year old middle school student, created a fake MySpace page for her principal, James McGonigle, using her parent's computer. The profile did not list his name, but included his photograph, which was taken from the school district's website. The website described McGonigle as a bisexual who liked "hitting on students and their parents" and "love[d] sex (of any kind)." J.S. initially set the MySpace profile as "public", but then changed the setting to private and granted "friend" status to about 20 children at the school. However, because the school computers block access to MySpace, students were only able to view the page from off-campus computers.

After learning about the website from a student, McGonigle called J.S. into his office. He told her that he was very hurt by the site and that he planned to take legal action against J.S. and her family. He later imposed a ten-day suspension on J.S., and prohibited her from attending school functions.

According to the school, the profile caused a minor disruption on campus. Two teachers had to quiet their classes while students talked about the profile, one guidance counselor had to proctor a test so another administrator could sit in on the meetings between McGonigle and J.S., and two students decorated J.S.'s locker to welcome her back following her suspension. J.S. v. Blue Mountain School District, 3rd Cir.., No. 08-4138, Opinion (Feb. 4, 2010).

The case is Williams v. MetroPCS Wireless, Inc., S.D. Fla, No. 1:09-cv-22890, Order (Jan. 5, 2010), a proposed class action against a pre-paid wireless phone carrier. The complaint alleged that MetroPCS marketed itself as a provider of unlimited nationwide coverage, but that in reality, its coverage reached less than half of the U.S. population and excluded 11 of the top 25 metropolitan areas. The complaint further alleged that MetroPCS offered flat rate plans in which customers were to pay by the month, not the minute, and were not required to sign a contract. However, lead plaintiff Marcia Williams claimed that after purchasing an unlimited $45/month plan, she was charged $225 for one month's service. The complaint sought equitable and declaratory relied, damages, attorneys' fees and a trial by jury.

MetroPCS contended that the allegations had no merit, and that Williams had entered into an arbitration agreement with MetroPCS, so the matter had to be settled in front of an arbitrator. According to MetroPCS . its standard business practice was to provide customers with several forms at the time service is initiated. These included an Agreement, a Start of Service Request Form and a Welcome Guide. The Welcome Guide referred customers to the MetroPCS website. At the footer of the website was a "Terms and Conditions" hyperlink that instructed users to review the Agreement. The Agreement contained an arbitration clause, requiring that claims or controversies relating to or arising out of the Agreement be resolved through individual binding arbitration.

MetroPCS claimed that under its standard business practices, Williams would have received these forms and hence had notice of the arbitration clause. However, MetroPCS was unable to provide testimony or other evidence showing that Williams actually received these forms.
Williams contended that she never received the Agreement or the Welcome Guide and never accessed MetroPCS's website. Williams further contended that the MetroPCS advertisements repeatedly stated that there was "no contract." One such advertisement allegedly featured a unicorn and a mermaid stating that no contract was required. Another commercial featured a contract being passed through an animated paper shredder and a drawing of a contract with a circle and diagonal line over it.

There is a liberal federal policy favoring enforcement of arbitration agreements. However, the policy only applies if the parties have actually entered into an agreement to arbitrate. Here there was no evidence that Williams had assented to the Agreement or its arbitration clause.

At the FTC's December 2009 privacy roundtable, panelists raised concerns that collection and third party use of browsing data invades private space by: (1) revealing a user's innermost thoughts, such as a search history that reflect a user's explorations of his sexual identity, (2) taking away a user's control over her identity, such as by broadcasting compromising photos of a user at a Cancun Spring Break party to a potential employer, (3) revealing sensitive identity or financial information that can be misused by third parties to perpetrate fraud, or (4) intruding on a user's seclusion by serving targeted ads during a browsing session that reveal that outsiders are listening in.

Survey data presented at the roundtable indicated that consumers are aware that information is being collected about them online and are uncomfortable with the idea that third parties are using this data. Alan Westin of a Columbia University stated that surveys indicate that "a majority ranging in numbers from low of 50% all the way up to 70% to 80% say they're uncomfortable with behavioral marketing and would want to have at a minimum a kind of notice, choice, security and ways of intervening that would give them some comfort if they were going to have their information tracked in that way."

A growing number of firms with online presences are offering users a chance to review the data being collected about them and to opt-out or the change the collection and use of that data. For example, Google's Dashboard and Ad Preferences Managers provide users with extensive details on the browsing history Google has collected about them. They also let users select or de-select ad categories they want served to them.

However, most users do not take advantage of these "notice and choice" systems. According to Google's head of U.S. public policy, Alan Davidson, Google gets "tens of thousands of unique visitors to these sites each week." However, "four times as many people who come as visitors to the site actually change their preferences rather than opting out. . . . [a]nd actually, ten times as many people actually do nothing." Rick Erwin of Experian Marketing Services stated that about 7200 consumers choose to opt-out of Experian's marketing data collection activities. Jennifer Barrrett from Acxiom stated that over the past ten years "about a half a million consumers" have asked to opt-out or correct information gathered by her site.

One explanation for the low level of consumer response to notice and choice systems is that these systems are simply too complex and confusing for consumers to navigate. Another explanation is that despite the survey data and a few incidents where use of private data led to personal woe, consumers are really not that concerned about the collection and use of their personal data.

This puts serious weapon in the hands of the general public that can be used protect legitimate copyright interests -- or can be misused by someone who has no rights in material used by a competing business to get its site shut down.

To prevent abuse of the notice and take down system, Congress put two major protective measures into the DMCA: the counter-notice procedures in § 512(g) and the misrepresentation rule in § 512(f). Section 512(f) provides that a person who "knowingly" misrepresents that material on a site is infringing is liable for any damages, including attorneys fees, incurred by the alleged infringer."

It can be very hard to prove a knowing misrepresentation occurred. Courts interpreting this statute have generally found that to be liable, the person who sent a false DMCA notice must have lacked the honest belief that material was infringing. As stated by the 9th Circuit, "Congress's apparent intent [was] that the statute protect potential violators from subjectively improper actions by copyright owners." Rossi v. MPAA, 391 F.3d 1000, 1005 (9th Cir. 2004).

To determine whether the sender of a false DMCA notice had a good faith belief in the truth of the notice, courts do not limit themselves to the testimony of the sender. Rather, courts consider the information that the sender relied on. However, it doesn't take much evidence for the court to find that the author of a DMCA notice acted in good faith.

For example, the Rossi case concerned the website www.internetmovies.com, which Rossi described as an online magazine that provided visitors with a directory of websites containing information about movies. Rossi's site contained the words "Join to download full length movies online now!" In fact, users could actually download no movies through Rossi's site or through the links to which he referred users -- a fact that MPAA investigators missed because they never attempted to download any movies from Rossi's site.

However, the 9th Circuit stated that the sender of a DMCA takedown notice is not required to perform a "reasonable investigation" and "cannot be held liable simply because an unknowing mistake is made, even if the copyright owner acted unreasonably in making the mistake." Id. at 1005. Accordingly, the 9th Circuit found that the MPAA acted in subjective good faith because the language on Rossi's site "led the MPAA employees to conclude in good faith that motion pictures owned by MPAA members were available for immediate downloading from the website."

In a recent decision, the 4th Circuit has reaffirmed its position that the CDA provides ISPs with immunity from suit for information created and developed by third parties. See Nemet Chevrolet v. Consumeraffairs.com, 4th Cir., No. 08-2097 (Dec., 29. 2009).

According to the Court,

"This Circuit has recognized the 'obvious chilling effect' the 'specter of tort liability' would otherwise pose to interactive computer service providers given the 'prolific' nature of speech on the Internet . . . Section 230 immunity, like other forms of immunity, is generally accorded effect at the first logical point in the litigation process. As we have often explained in the qualified immunity context, immunity is an immunity from suit rather than a mere defense to liability: and 'it is effectively lost if a case is erroneously permitted to go to trial'. . . We thus aim to resolve the question of §230 immunity at the earliest possible stage of the case because that immunity protects websites not only from 'ultimate liability,' but also from "having to fight costly and protracted legal battles." (emphasis added).

In the Nemet case, this meant that the Court resolved the question of §230 immunity in a 12(b)(6) motion to dismiss, which was filed at the outset of the case. The Court ultimately dismissed the claim, concluding that the factual allegations in the complaint could not plausibly support an inference that Consumeraffairs.com could be considered a creator of the defamatory posts in question.

Even Circuits that have dissented from a strict immunity interpretation of the CDA have also been willing to entertain such early motions to dismiss defamation suits. See Chicago Lawyers, 521 F.3d at 672 (affirming judgment on the pleadings based on a CDA immunity defense); Barnes v. Yahoo, 570 F.3d 1096 (9th Cir. 2009) (affirming motion to dismiss negligence claim based on CDA immunity defense). This suggests that the debate over whether the CDA is an "immunity" statute may be a bit of a tempest in a teapot without much practical effect on actual court decisions.

In any event, regardless the Circuit in which an Internet defamation claim is brought, plaintiffs with a colorable CDA defense are still advised to attempt to seek dismissal at the earliest stage in the litigation possible -- such as via an anti-SLAPP motion or motion to dismiss.

David D. Johnson is a business lawyer whose practice focuses on litigation and other issues relating to digital media and consumer electronics companies. David can be contacted at (310) 785-5371 or DJohnson@jmbm.com.

No one on the defense side was represented at the preliminary injunction hearing. The court order also suggests that no one at the domain name registries/registrar/web hosting companies received notice of or were represented at the hearing. As a result, the order appears to be rife with substantive and procedural defects. (Not an unusual result when an order is issued without the benefit of defense counsel briefing).

But what about the substantive issue at stake in this order: What rights does a person who is the object of a defamatory Internet post have to get the post removed? Can the aggrieved seek an injunction against the author of the post? If she can't locate the author, who may be anonymous, does she have the right to get an injunction against the host of the website to get it removed?

In fact, the law is somewhat unsettled in this area, and the relief available may depend on the jurisdiction in which the plaintiff sues.

• The First Amendment to the U.S. Constitution bars injunctive relief, but only until a jury trial on whether the statement in question is defamatory has been conducted.

The First Amendment to the U.S. Constitution protects freedom of speech, but this protection is not unlimited. A series of U.S. Supreme Court decisions have held that a media outlet may be enjoined from further publication of a libelous statement. See Pittsburgh Press Co. v. Pittsburgh Commission on Human Relations, 413 U.S. 376, 390 (1973). However, such an injunction may only be issued after a full jury determination that the statement is in fact defamatory. See Kramer v. Thompson, 947 F.2d 666, 676 n. 25 (3d. Cir. 1991) (summarizing cases).

The Court's decision arose out of a controversy over the film Hillary: The Movie, a film criticizing Sen. Hillary Clinton, that nonprofit organization Citizens United wished to broadcast during the 2008 election season. Citizens United was concerned that the film and ads that supported it would be covered by §441b's ban on corporate-funded expenditures, so it filed a suit for declaratory and injunctive relief against the Federal Election Commission (FEC). A District of Columbia District Court three-judge panel denied Citizens United's petition for a preliminary injunction, holding that §441b was facially constitutional under Supreme Court precedent.

The Supreme Court has now overruled that District Court ruling. The opinion was written by the "centrist" Justice Kennedy, with concurrences by Justices Roberts, Alito, Scalia, and Thomas.

Justice Kennedy's opinion characterized §441b's prohibition on independent corporate expenditures as a "ban on speech." He noted that laws that burden political speech are subject to strict scrutiny, which requires the Government to prove that the restriction "furthers a compelling interest and is narrowly tailored to that interest." Few restrictions on speech have ever satisfied this test.

According to Kennedy, "the First Amendment stands against attempts to disfavor certain subjects or viewpoints," Indeed, "[s]peech restrictions based on the identity of the speaker are all too often simply a means of content control." This means that the Government cannot impose restrictions on certain disfavored speakers. That includes corporations, because "First Amendment protections extend to corporations." Political speech does not lose First Amendment protection "simply because its source is a corporation."

Kennedy admitted that since the latter part of the 19th Century, state and federal laws have imposed a ban on direct corporate contributions to candidates. However, laws prohibiting corporate expenditures for independent corporate advocacy were not enacted until 1947. Corporate expenditures that are made to candidates are different from independent expenditures, because donations made directly to candidates raise the possibility of corruption -- as held in Buckley v. Valeo, 424 U.S. 1, 47-48 (1976). As such, until 1990, the Supreme Court upheld laws restricting corporate donations to candidates, but struck down laws restrictions on corporate independent expenditures. See, e.g., First Nat. Bank of Boston v. Belotti, 435 U.S. 765, 784 (1978).

As the basis for its actions against Comcast, as well as its proposed rulemaking, the FCC cited its longstanding agency policies to encourage the development of broadband and promote the open and interconnected nature of the Internet. See, e.g., FCC, Notice of Proposed Rulemaking, FCC 09-93 (Oct. 22, 2009). However, the FCC is not a part of the legislative, but the executive branch of government. It is a creature of statute and has no power to regulate anything except as provided by Congress via statute.

Accordingly, Comcast filed an appeal against the FCC's actions against it, claiming that the FCC lacked jurisdiction -- i.e. -- statutory authority -- to regulate the Internet. See Comcast v. FCC, D.C. Cir, No. 08-1291. The FCC's briefs indicate that the basis for its claimed jurisdiction against Comcast is the same as the basis for its claimed right to promulgate its net neutrality rules. So, a ruling against the FCC in the Comcast case could well doom its proposed net neutrality rules, as well.

Reports from the D.C. Circuit's hearing of the Comcast appeal indicate that the Court viewed the FCC's jurisdictional claims with considerable skepticism. So how solid are the FCC's claims that it has the right to promulgate net neutrality rules?

By way of background, the federal statute the provides the FCC with its authority is the Telecommunications Act. The Act is subdivided into multiple sub-chapters or "Titles" that provide rules for specific communications technologies: Title II regulates common carriers (e.g., telephone companies), Title III regulates radio and Title V regulates cable. The Act states in broad terms that the FCC "shall execute and enforce the provisions of" the Telecommunications Act." 47 U.S.C. § 151.

The Internet uses telephone, cable and radio services which are subject to FCC regulation. However, at its heart, the Internet is a system of interconnected computers that is far broader than any of these communication services. Accordingly, since the 1970s, the FCC has recognized a distinction between computer processing services (including the Internet), and communications services (like telephone services) over which these computer processing services are carried. These separate classifications were incorporated by Congress into the 1996 Telecommunications Act -- which distinguishes between "information services" and "telecommunications services." Information services include "the offering of a capability for generating, acquiring, storing, transforming, processing, retrieving, utilizing, or making available information via telecommunications" -- the kinds of services provided via the Internet. 47 U.S.C. § 153(20). Telecommunications services include "transmission of information, without a change in its form or content" -- i.e., traditional telephone data services. 47 U.S.C. §§(43), (46).

This distinction makes a difference, because only providers of telecommunications services are considered "common carriers" and subject to Title II regulations. 47 U.S.C. § 153(44). See NCTA v. Brand X Internet Services, 545 U.S. 969 (2005). Among Title II regulations is a provision prohibiting common carriers from engaging in "any unjust or unreasonable discrimination" in services. 47 U.S.C. § 202(a).

Courts routinely enforce clickwrap agreements. See our post of November 13, 2009. However, the FTC has begin to subject such agreements to increased scrutiny and found some to be unfair where users were asked to register their assent to the agreement before being aware of all their terms. See our post of September 21, 2009. Courts often have difficulty enforcing browsewrap agreements for similar reasons -- because it is often difficult to demonstrate that the user ever read the terms of use or assented to them.

However, in recent case, a Missouri Court of Appeals upheld a browsewrap agreement - but one that verged on actually being a clickwrap agreement. The case, Major v. McCallister, Missouri Court of Appeals, No. CD29871 (Dec. 23, 2009), involved a website operated by ServiceMagic, which offered users free referrals to construction contractors.

A visitor to the ServiceMaster website first encountered several screens in which he/she inputted information about his/her remodeling project. Each of these pages contained a hyperlink to ServiceMaster's Terms of Use. A user was not required to click on the hyperlink or read the Terms of Use to proceed.

After the user entered his/her project information, the ServiceMaster site would produce a screen stating that the user had been matched to several contractors. The screen also contained space for the user to enter his/her contact information, followed by a "Submit for Matching Pros" button. Next to the button was a blue hyperlink to the website's Terms of Use and the statement "By submitting you agree to the Terms of Use."