What’s at Stake
Whether companies like Target can force consumers into individual arbitration based on online contract terms without proving that the consumers necessarily would have seen notice of the terms or that the notice was clearly displayed.
Summary
Dylan Dawson filed a putative California consumer class action against Target Corporation and Shipt, Inc., alleging that Target and Shipt promised free or flat-rate delivery but charged California delivery customers a mandatory $3.99 ‘CA Shopper Benefits Fee’ late in the checkout process, in violation of California consumer protection laws.
Target and Shipt moved to compel arbitration. The district court denied their motions, holding that defendants failed to prove Dawson was on notice of and unambiguously assented to the arbitration agreement through the account-creation, sign-in, or checkout screens. Target appealed, and Public Justice joined to represent Mr. Dawson on appeal.
In a summary order, the Ninth Circuit sent the case back to the district court to determine whether Mr. Dawson in fact saw the screens that Target presented with its motion. The court did not address the district court’s holding that, even if Mr. Dawson did see the screens, they did not provide sufficiently conspicuous notice of Target’s terms of service.
Core Legal Questions
On appeal, the two legal issues were (1) whether Target’s generic evidence of its app’s sign-in and checkout screens was sufficient to meet its burden of showing how the app would have looked to Mr. Dawson when he signed in and made a purchase; and (2) whether the references to Target’s terms on the sign-in and checkout screens were sufficiently conspicuous to put Mr. Dawson on notice of the terms so as to form a contract. The Ninth Circuit remanded for the district court to make factual findings on the first question but did not address the second question, which the district court previously answered in the negative.