Caspi v. Microsoft Network
Citation and Court
Caspi v. Microsoft Network, LLC, 323 N.J. Super. 118 (App. Div. 1999)
Facts
Plaintiffs subscribed to Microsoft’s online network service (MSN) by clicking through a sign-up process that included a membership agreement displayed on screen. The agreement contained a forum selection clause requiring disputes to be litigated in Washington state. Plaintiffs, New Jersey residents, sued in New Jersey and challenged the enforceability of the forum selection clause, arguing they had not meaningfully assented to it.
Issue
Whether a forum selection clause contained in a clickwrap agreement displayed during an online sign-up process is enforceable against subscribers.
Holding
The court held that the clickwrap agreement and its forum selection clause were enforceable because subscribers had a reasonable opportunity to review the terms before clicking to accept.
Rule / Doctrine
Clickwrap agreements—where users must affirmatively click to accept terms presented on screen—are enforceable contracts. A user who clicks “I agree” after being given the opportunity to read the terms is bound by them, including forum selection clauses, absent fraud, overreaching, or other vitiating factors.
Significance
An early and influential case validating the enforceability of online clickwrap contracts, contrasting with later cases about browsewrap agreements where terms are merely linked rather than actively presented. Establishes that the medium of contract formation (internet) does not undermine assent if the terms are reasonably communicated.