Law in Contemporary Society

Nutrition Facts for Contracts

-- By NnamdiNwaezeapu - 3 June 2021

This essay addresses the problem of unread and unreadable clickwrap, browsewrap, and scrollwrap agreements (“Clickwrap Agreements”). To accomplish this goal we will explain why unread and unreadable Clickwrap Agreements are a problem, and then propose a solution by borrowing from the now widely adopted tool: nutrition labels.

1 Why unread Clickwrap Agreements are a problem.

“A Deloitte survey of 2,000 U.S. consumers in 2017 found that 91% of people consent to terms of service without reading them. For younger people, ages 18-34, that rate was even higher: 97% did so.” Source: USA Today. Further, a recent analysis of the 500 most popular on-line consumer contracts (including Facebook and Uber) found that most were written to the same level as academic articles, and as such were incomprehensible to the average consumer. Source: The Conversation.

Despite these facts, our legal system, with its fetishization of bright-line rules and bias towards “efficiency,” treats these unread, and unreadable contracts as enforceable.

For the uninitiated, the “duty to read” concept has been around for almost half a century, and its essence is well-stated by this quote from a 1974 Fordham Law Review article written by legal scholar John D. Calamari:

A party who signs an instrument manifests assent to it and may not later complain that he did not read the instrument or that he did not understand its contents. Source: John D. Calamari, Fordham Law Review

This “duty to read” requirement, paired with the fact that most Clickwrap Agreements are not read or even readable, allows for businesses to include terms like granting companies the right to sell user information to third parties, track user movements via gps, and in some cases, even grant perpetual licenses to a user’s likeness.

Supporters of the duty to read will cite cases like the famous Williams v. Walker-Thomas Furniture Co. as evidence that consumers will be protected whenever Clickwrap Agreements are unconscionable. (See Williams v. Walker-Thomas Furniture Co., 121 U.S. App. D.C. 315, 350 F.2d 445 (1965)).

But as Calamari points out, there is not only, “inconsistency in the authorities regarding [the theories to] be applied, but apparently opposite results are being reached in cases with substantially similar fact patterns.” Source: John D. Calamari, Fordham Law Review. And unfortunately, not much has changed since 1974. Specifically, the BYU Law Review published an article in 2012 that describes the current issue:

“When Judge Sotomayor handed down her opinion in Specht in 2002, she explained that the enforceability of these agreements could really only be justified where the user should reasonably know what she is doing when she enters the site or clicks to accept. This caution has eroded over the last decade, however, as courts have become more and more comfortable with enforcing online agreements almost regardless of the conspicuousness of terms.”

Source: Cheryl B. Preston, McCann, Eli W., BYU Journal of Public Law.

For this reason, and as alluded to in the conclusion of both Calamari’s 1974 article and BYU Law’s 2012 article, the trend regarding Clickwrap Agreements will likely require legislatures and administrative bodies stepping in to regulate these forms.

2 A solution to the problem of unread and unreadable Clickwrap Agreements.

“In the summer of 1989, concerned that food labeling did not allow Americans to take advantage of the latest advances in nutrition, Dr. Louis W. Sullivan, then Secretary of the U.S. Department of Health and Human Services (HHS), directed FDA to undertake a comprehensive initiative to revise the food label (FDA, 1990). He later stated that, “As consumers shop for healthier food, they encounter confusion and frustration… . The grocery store has become a Tower of Babel and consumers need to be linguists, scientists and mind readers to understand the many labels they see.” Source: Institute of Medicine (US).

The problems we faced around understanding the contents of our food, are similar to the problems we currently face with respect to what is in our Clickwrap Agreements. The current agreements do not allow users to “take advantage of the latest advances'' in data privacy learnings, and many users who want to use products that respect their data privacy encounter much “confusion and frustration.”_ Id._

A potential solution to this problem is to establish a “data label.” Specifically, borrowing from the legislation of the Nutrition Labeling and Education Act (NLEA), a Data Labeling and Education Act could be passed, forcing technology companies to clearly display the data they are collecting, and measure that against a “healthy” data collection standard.

From a technical standpoint, we already have examples from organizations like Terms of Service Didn’t Read demonstrating that such a “data label” is possible and can be effective. Source: The biggest challenge, therefore, will be actually getting the legislation passed. Specifically, in addition to the inevitable pushback from “Big Tech,” the available government agencies that could effectively handle such a task (e.g. the FTC) are limited. Thus, in order for a data-labeling scheme to work, it will require the same forces that the nutrition label needed to get implemented, namely, immensely strong demand from citizens, as well as a government that recognizes its importance.

However, if the history of the nutrition label is any guide, even under ideal political circumstances it could (and likely will) take as long as 60 years for widespread and effective implementation of a “data label.” Id. Thus, in the meantime, we will therefore need to continue to search for other ways to help protect users from predatory technology companies. Because as we have seen in the food world, despite the existence of nutrition labels, 39.6% of Americans are still clinically obese. Source: American Medical Association. As such, “data labels” will not solve all our problems, and many will still continue to consume data “big macs.” However, for those who do want to make “healthier” choices about the services that they use, this could prove to be an effective first step.

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r3 - 03 Jun 2021 - 17:24:30 - NnamdiNwaezeapu
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