Courts Narrow Enforcement of Arbitration Clauses Based on Website Design
Eleventh Circuit and state courts reject arbitration clauses due to unclear website consent design.
Why it matters: General counsel and legal teams must ensure website terms are clearly presented to secure enforceable arbitration agreements and avoid costly litigation risks.
- Eleventh Circuit in Tejon v. Zeus Networks blocked arbitration due to an inconspicuous Terms of Service link.
- California courts in Firlej v. Petrosian and Penning v. NVIDIA enforced arbitration with visible checkboxes and prominent links.
- Pennsylvania court in Duffy v. Tatum required conspicuous notice of jury trial waiver for enforceability.
- Courts focus on font size, color contrast, hyperlink placement, and explicit user assent when deciding enforceability.
Recent court decisions highlight how website design critically affects the enforceability of arbitration clauses in consumer agreements, a growing concern for corporate legal teams.
In Tejon v. Zeus Networks, LLC, the U.S. Court of Appeals for the Eleventh Circuit ruled against enforcing an arbitration clause because the Terms of Service hyperlink was small, gray-on-black, and placed below the "Confirm" button. The court found this insufficiently conspicuous to notify a reasonable user, undermining valid consent.
In contrast, California courts enforced arbitration agreements when users provided affirmative consent via clear checkboxes combined with conspicuous Terms of Service links. For instance, in Firlej v. Petrosian Esthetic Enterprises, a checkbox with explicit consent language and bullet-pointed Terms links upheld the arbitration clause. Similarly, Penning v. NVIDIA featured a cookie banner with a prominently underlined, contrasting green Terms of Service link positioned above action buttons, further supporting enforcement.
The Pennsylvania Superior Court in Duffy v. Tatum stressed that users must receive "reasonably conspicuous" notice that they waive jury trial rights. Factors like font size, color contrast, and placement near buttons were critical in the court's assessment.
These rulings confirm that courts analyze the entire design context: Are arbitration terms visually prominent? Is user assent affirmative rather than implied? Are legal rights waivers prominently communicated?
Legal professionals drafting or reviewing online agreements should avoid small fonts, muted colors, and hidden links that may render arbitration clauses unenforceable. Instead, they must ensure links to Terms of Service or arbitration clauses are boldly visible, placed near confirmation actions, and coupled with explicit waiver language to withstand judicial scrutiny.
By the numbers:
- 2019 — Eleventh Circuit ruled on Tejon v. Zeus Networks arbitration unenforceability
- 2023 — Pennsylvania Superior Court issued Duffy v. Tatum decision emphasizing conspicuous notice
- Multiple — California courts upheld arbitration when clear checkboxes and prominent links used
Yes, but: Some rulings vary by jurisdiction, so companies should tailor website consent designs to specific state requirements and recent court precedents.
What's next: Companies should monitor evolving case law on online consent as courts continue refining enforceability standards for digital agreements.