Chapter 19 E-Contracts and E-Signatures Copyright © 2009 South-Western Legal Studies in Business, a part of South-Western Cengage Learning. Jentz Miller Cross BUSINESS LAW Alternate Edition 11 th Ed.

Copyright © 2009 South-Western Legal Studies in Business, a part of South-Western Cengage Learning. 2 §1: Online Contract Formation  Online Offers. –Displaying the Offer. Seller’s website should include hyperlink to page with full contract. –CASE 19.1 Feldman v. Google, Inc. (2007).

Copyright © 2009 South-Western Legal Studies in Business, a part of South-Western Cengage Learning. 3 Provisions to Include  Remedies for Seller and Buyer.  Statute of Limitations.  What constitutes Buyer’s acceptance.  Method of Payment.  Seller’s Refund and Return Policies.  Disclaimers of Liability.  How Seller will Use Buyer’s Information (Privacy).

Copyright © 2009 South-Western Legal Studies in Business, a part of South-Western Cengage Learning. 4 Provisions to Include  Dispute Settlement Provisions. –Choice of Law. –Choice of Forum. –E-Bay uses online dispute resolution.  How Offer Will Be Accepted. –Amazon.com--Checkout. –“I Accept” Button to Click.

Copyright © 2009 South-Western Legal Studies in Business, a part of South-Western Cengage Learning. 5 Click Agreements  Shrink-Wrap Agreements. –Contract terms are inside the box. –Party opening box agrees to terms by keeping merchandise.  Enforceable Contract Terms. (UCC ).  Additional Terms.

Copyright © 2009 South-Western Legal Studies in Business, a part of South-Western Cengage Learning. 6 Online Acceptances  Click-On Agreements occur when Buyer “checks out” or clicks on “I Accept” button on Seller’s website or when software is installed. –CASE 19.2 Mortgage Plus, Inc. v. DocMagic, Inc. (2004).  Browse-Wrap Terms.

Copyright © 2009 South-Western Legal Studies in Business, a part of South-Western Cengage Learning. 7 § 2: E-Signatures  E-Signature Technologies. –Digitized Handwritten Signatures (credit card checkout). –Cyber Notary.  State Law Governing E-Signatures. –Uniform Electronic Transactions Act (1999).

Copyright © 2009 South-Western Legal Studies in Business, a part of South-Western Cengage Learning. 8 Federal Law on E-Signatures  E-SIGN (2000) gives e-signatures and e- documents legal force.  CASE 19.3 Amber Chemical, Inc. v. Reilly Industries, Inc. (2007).

Copyright © 2009 South-Western Legal Studies in Business, a part of South-Western Cengage Learning. 9 Partnering Agreements  Sellers and Buyers agree as to protocols to create online agreements.  Useful for electronic inventory (Just In Time) ordering of parts and supplies.

Copyright © 2009 South-Western Legal Studies in Business, a part of South-Western Cengage Learning. 10 § 3: The Uniform Electronic Transactions Act  Purpose is to remove barriers to forming electronic commerce.  E-Signature is “electronic sound, symbol or process…associated with a record and… adopted by a person with intent to sign the record.”  UETA applies only to e-records and e- signatures relating to a transaction.

Copyright © 2009 South-Western Legal Studies in Business, a part of South-Western Cengage Learning. 11 UETA and E-SIGN  E-SIGN explicitly refers to UETA.  Provides that E-SIGN is pre-empted by state passing of UETA.  But state law must conform to minimum E- SIGN procedures.

Copyright © 2009 South-Western Legal Studies in Business, a part of South-Western Cengage Learning. 12 E-Sign and UETA

Copyright © 2009 South-Western Legal Studies in Business, a part of South-Western Cengage Learning. 13 Highlights of UETA  Parties must agree to Conduct Transactions Electronically. –A party can “opt out” of UETA terms.  Attribution—process to ensure person sending an electronic record is in fact the real person.

Copyright © 2009 South-Western Legal Studies in Business, a part of South-Western Cengage Learning. 14 Highlights of UETA  Electronic Errors.  “ box” Rules. –Dispatched when leaves control of sender. –Received when enters recipient’s processing system (even if unaware).