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The Courts Government United States News Your Rights Online

Web Contracts Can't Be Changed Without Notice 169

Posted by kdawson from the late-binding dept.
RZG writes "The U.S. Court of Appeals for the Ninth Circuit ruled on July 18th that contracts posted online cannot be updated without notifying users (PDF of ruling). 'Parties to a contract have no obligation to check the terms on a periodic basis to learn whether they have been changed by the other side,' the court wrote. This ruling has consequences for many online businesses, which took for granted their right to do this (see for example item 19 in Google's Terms of Service)."
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Web Contracts Can't Be Changed Without Notice More

Web Contracts Can't Be Changed Without Notice

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  • Booh (Score:4, Funny)

    by Anonymous Coward on Sunday July 29, 2007 @01:58PM (#20033149)
    What about the mega-corporation's rights to mercilessly screw their customers? This ruling ain't fair, you know.

  • And of Course (Score:4, Insightful)

    by OverlordQ ( 264228 ) on Sunday July 29, 2007 @01:59PM (#20033157) Journal
    Isn't this only applicable in the 9th Circus^Hit's jurisdiction?

    • Re:And of Course (Score:4, Informative)

      by Wuhao ( 471511 ) on Sunday July 29, 2007 @02:07PM (#20033223)
      No, the 9th Circuit is a federal court, and so this decision has consequences nation-wide.

      • Re:And of Course (Score:5, Informative)

        by cpt kangarooski ( 3773 ) on Sunday July 29, 2007 @02:30PM (#20033453) Homepage
        Well, that's true, but it's not binding precedent except for the district courts under the 9th Circuit. For everyone else, it is merely influential.
        • Well, that's true, but it's not binding precedent except for the district courts under the 9th Circuit. For everyone else, it is merely influential.

          This sounds like an excellent reason why this ruling shouldn't be appealed to the SCOTUS. Limit the full damage of this ruling to the Ninth Circuit alone for now.

          • What full damage? This sounds like a very reasonable opinion. All it says is that if one party decides to change the terms of a contract, it has to tell the other party (and I would assume without RTFO -- if the other party doesn't like the new terms, the other party can say no). Without this, you could "sign" a contract in July that says "we will keep your info private" and then in October, without notice to you, it could be changed to "you owe us one million dollars". I guess you think that would be fair? Give me your address, I have a harmless little contract I want to send you.

  • Not a big issue (Score:5, Insightful)

    by MysteriousPreacher ( 702266 ) on Sunday July 29, 2007 @02:00PM (#20033163) Journal
    Well, it's not a big issue for sites that require a login. All they have to do is flash up the new terms for the users next time they log-in. World of Warcraft does this during patching if the licence has changed. WoW isn't a web site but the principle is the same.

    Any site that would change its terms without some kind of notice to users has been operating in cowboy land anyway.

    • Re:Not a big issue (Score:5, Interesting)

      by ushering05401 ( 1086795 ) on Sunday July 29, 2007 @02:14PM (#20033293) Journal
      The main point, IMHO, is that the courts appear to be catching up with the tech world.

      This is not an isolated incident, there have been numerous clarifications coming out that will help the internet become a more legally defined avenue through which to conduct business.

      To see another example of courts starting to actually understand what they are ruling on you need look no further than today's /. front page... Check out the "Judge Permits eBay's "Buy It Now" Feature" story.

      I have been following both court rulings and political decisions related to the internet for some time now, and I am finally starting to see some glimmer of hope that the most empowering utility of our time will not go down the crapper due to the ignorance of those empowered to regulate it.

      Of course, there is still the net neutrality issue... but at least there is some movement toward understanding.

      Regards.

    • Re:Not a big issue (Score:4, Funny)

      by Esion Modnar ( 632431 ) on Sunday July 29, 2007 @03:13PM (#20033699)
      Any site that would change its terms without some kind of notice to users has been operating in cowboy land anyway.


      Brokeback Mountain land, that is.

    • Re:Not a big issue (Score:4, Informative)

      by freedom_india ( 780002 ) on Sunday July 29, 2007 @03:28PM (#20033851) Homepage Journal
      Apple does it all the time with its various updates.
      Without accepting the new license, itunes does NOT open.
      • If iTunes won't open until you accept the updated license, how is the user not being notified of the change?

        • Re: (Score:3, Informative)

          by Gabrill ( 556503 )
          The program that plays the files you licensed does not open, thereby depriving you of their use.
          • Okay, that would certainly suck, but that's a separate issue from being notified about changes to the terms of service.

          • Re: (Score:3, Informative)

            by Anonymous Coward

            The program that plays the files you licensed does not open, thereby depriving you of their use.
            The program that plays the files you licensed DOES open, so that you can continue to play those files, as long as you don't install the upgrade. Click "decline" on the EULA.

            • Re: (Score:2)

              by Gabrill ( 556503 )
              I suppose it's fitting that you posted AC, considering I just tested your theory with a new I-tunes click-through license. You're theory is incorrect.

        • Re: (Score:2)

          by JacobO ( 41895 )
          The damn box often pops under other apps and I sit there wondering where iTunes went to. So I start iTunes again, it sees itself already running and doesn't open at all. Then after a little pointless exploratory clicking around, I remember that I have suffered this indignity before and I curse into the ether.

      • Re: (Score:2)

        by zCyl ( 14362 )

        Apple does it all the time with its various updates.
        Without accepting the new license, itunes does NOT open.

        IANAL, and I am not an iTunes user, but since iTunes is a service which must be used to gain access to songs that have already been paid for, it seems that this would qualify as a contract entered into under economic duress [wikipedia.org], and would therefore be unenforceable.

        • Re:Not a big issue (Score:4, Insightful)

          by mr_matticus ( 928346 ) on Sunday July 29, 2007 @06:57PM (#20035789)
          The simple solution in that case would be not to install the new version. The license text is available when it asks you if you want to update. It's available on their website at any time. It is, in fact, presented to you before the update downloads and then AGAIN after.

          If you managed to be so lazy as to not take any of those opportunities to know what you're getting into, then you deserve what you get. Even at that point, though, you could also use any number of resources to get the older installer with the older user agreement that you agreed to, while continuing to use your purchases.

          It's not duress, plain and simple, because you're not being forced to do anything with your existing purchases. There's no leverage on money spent by you and no one threatening to make worthless your investment. The songs you already purchased won't stop working if you don't update. You just won't be able to make NEW purchases if they make changes to the store.

  • Kind of sad (Score:5, Insightful)

    by CastrTroy ( 595695 ) on Sunday July 29, 2007 @02:00PM (#20033167)
    It's kind of sad that something like this has to be decided in court, and isn't actually just common sense. I can't have someone sign a paper contract, and then go and change everything around, and them make them bound to said contract. I don't know why anybody would think an online contract would be any different. The whole idea of changing a contract after someone has already agreed it is ludicrous.

    • Re: (Score:3, Insightful)

      by Compholio ( 770966 )

      The whole idea of changing a contract after someone has already agreed it is ludicrous.

      No it's not, many contracts get changed after they have been agreed to. An example I've seen myself is lease agreements - when you renew your lease it can be a lot easier to revise the original contract (corrections are made and signed by both parties). I've also seen where the renewal is an "addendum" to the original contract (signed by both parties). Times change, contracts get renegotiated - you just need to be fai

      • Re: (Score:3, Interesting)

        by Volante3192 ( 953645 )
        Ahh, but you made sure to state that the changes are "signed by both parties."

        That's entirely different. But what if two parties signed a lease agreement, then the property owner goes and makes changes to it and then sues you for violating the new changes that you never signed to.

      • Re:Kind of sad (Score:5, Insightful)

        by CastrTroy ( 595695 ) on Sunday July 29, 2007 @02:24PM (#20033399)
        The point is, is that these companies are not being fair about the renegotiations. There are actually no negotiations going on at all. They just change the contract, tell you if you don't like it, you can leave, and you may not even have any idea that we've changed the contract until it's too late. You're landlord can't just come to you 6 months after you've signed the lease, and take away your stove, fridge, and dishwashers, and say, sorry, we changed the terms of this contract, and you're not entitled to that stuff anymore. If you don't like it, you can leave. Oh, but you now have to give us 4 months warning before moving out, or you'll be held accountable for the extra rent.
        • The point is, is that these companies are not being fair about the renegotiations. There are actually no negotiations going on at all. They just change the contract, tell you if you don't like it, you can leave ...

          In the U.S. I believe it is called an adhesion contract and they are generally valid as long as the terms are reasonable, reasonable to a judge not slashdot readers. :-) To be unreasonable, or more accurately legally unconscionable, oppression or surprise is usually involved. Clickwrap and shr

          • Re:Clickwrap/shrinkwrap usually binding contracts (Score:4, Informative)

            by Courageous ( 228506 ) on Sunday July 29, 2007 @04:35PM (#20034465)

            In the U.S. I believe it is called an adhesion contract and they are generally valid as long as the terms are reasonable, reasonable to a judge not slashdot readers. :-) To be unreasonable, or more accurately legally unconscionable, oppression or surprise is usually involved.


            Or something that wouldn't have been agreed to, had any reasonable person actually read the contract. Another way of looking at it is that if the offerror of the contract had reason to believe it wouldn't have been agreed to had the terms been known, the terms are definitionally "unconcionable."

            C//
            • "In the U.S. I believe it is called an adhesion contract and they are generally valid as long as the terms are reasonable, reasonable to a judge not slashdot readers. :-) To be unreasonable, or more accurately legally unconscionable, oppression or surprise is usually involved."

              Or something that wouldn't have been agreed to, had any reasonable person actually read the contract. Another way of looking at it is that if the offerror of the contract had reason to believe it wouldn't have been agreed to had th
              • Sure. It's a surprise. But not all surprises are exempted. Only those that would be unconcionable ones. :)

        • Re: (Score:3, Interesting)

          by sco08y ( 615665 )
          The point is, is that these companies are not being fair about the renegotiations. There are actually no negotiations going on at all. They just change the contract, tell you if you don't like it, you can leave, and you may not even have any idea that we've changed the contract until it's too late.

          IANAL, but taking Google's TOS as an example, I think it's a license, not a contract. Reasons: 1. They don't call it a contract; it's a "legal agreement." 2. There are no negotiations, and no way to submit ammendm

        • The point is, is that these companies are not being fair about the renegotiations. There are actually no negotiations going on at all. They just change the contract, tell you if you don't like it, you can leave, and you may not even have any idea that we've changed the contract until it's too late.

          Actually the is actually even LESS fair than that...

          They can change the contract without any notification and often include language that says "continued use of the service is your agreement to the contract."

      • I think he was making the point that you can't just go changing a physical contract after its been signed without notifying and getting agreement of both sides, and expect it to be binding. Putting up the changed version online and saying 'well, it's up to you to check and see if the contract has changed - failure to complain or cancel your service means you accept the new terms' would be ludicrous in the real world, it's amazing that this even needed to go to court.

      • ...many contracts get changed after they have been agreed to... when you renew your lease...
        Isn't a lease renewal considered a new contract though? The terms of the lease you first signed aren't being changed, you're agreeing to new terms for your new lease.

      • Re: (Score:2)

        by Eivind ( 15695 )
        True, but a contract that says:

        1) Part X can make whatever changes he feels like to this contract at any time, and Y shall be immediately bound by such changes. X, does not have to notify Y of the changes in any way, it is Y's responsibility to check the contract continously.

        Is very obviously loopsided to the point where in many jurisdictions it is no longer a valid contract. It in effect changes a two-sided contract to become a one-sided dictate.

    • Re: (Score:2)

      by PPH ( 736903 )
      IANAL, but in paper contract land, one must actually get all parties to a contract to agree to the changes before they take force.


      Things like 'opt out' or continued service as a condition of accepting all subsequent contract changes has to be spelled out very carefully in the original terms to be enforceable.

    • Re: (Score:2)

      by Kjella ( 173770 )
      Agreed. Unfortunately, you can make it almost as annoying and still make the customer "agree". Pretty much every time I shop any computer components online, there's a checkbox to agree to the current terms and conditions. There's usually the same wishy-washy stuff and mostly irrelevant due to consumer protection laws anyway, but there's no information of changes or a revision history. Maybe you read it the first time. Are you going to read it the 10th time? And if they change it on the 11th? You "agreed", j

      • Re: (Score:2)

        by sepluv ( 641107 )
        The thing I find really annoying is all those websites that get you to fill in loads of forms to buy something or sign up for something (e.g.: a bank account or online service) and only after doing all that will they let you see the contract, but if you spend more than a few minutes reading the ten-thousand word contract of complex legalese (with an insanely high word-to-sentence ratio and no punctuation), they make you start all over again (for "security reasons"). Especially annoying if they try to disab

      • Re: (Score:2)

        by HiThere ( 15173 )
        You're right. My instinct at that point is to stop agreeing. In fact that's why I ended up in Linux. One too many EULAs from MS. I am, however, well aware that my reaction isn't the most common one, and that most people will just stop reading them, if they ever read them in the first place.

        For that matter, I'm just on the edge of getting my wife a second computer (Linux) so that I can disconnect her Mac from the internet. Every EULA that I've read has been "not too horrible...for the most part", but th

    • Re: (Score:2)

      by sco08y ( 615665 )
      It's kind of sad that something like this has to be decided in court, and isn't actually just common sense.

      Hold on a second. Why is it that when we sign up for a web site we don't just get an RSS feed of the terms of service? If that was standard practice then the courts might have ruled the other way.

      I don't know why anybody would think an online contract would be any different. The whole idea of changing a contract after someone has already agreed it is ludicrous.

      You're making a big assumption about what

    • Re: (Score:2)

      by mi ( 197448 )

      I can't have someone sign a paper contract, and then go and change everything around, and them make them bound to said contract.

      Of course you can. You just need to include in the contract a clause giving you the right to change it all. Persuading the other party to sign such a thing would be very difficult in the material world, but on the Internet people seem to be agreeing to just about anything to get a free ring-tone.

      On the other hand, there is a small library-worth of laws regulating, what can not

  • Open Directory License (Score:3, Interesting)

    by sepluv ( 641107 ) <blakesley AT gmail DOT com> on Sunday July 29, 2007 @02:02PM (#20033183)
    Would this affect clause 4 of the ODP (DMoz) License [dmoz.org] (and similar copyright licenses)? Maybe that isn't considered a contract or only having to make "reasonable efforts" to check for changes is acceptable.

  • Good! (Score:4, Informative)

    by iknownuttin ( 1099999 ) on Sunday July 29, 2007 @02:05PM (#20033209)
    It always pisses me off that some web services say in their very long agreement that they have the right to change the terms at any time. I refuse to do business with those people.

    Talk America....their telemarketers used to always bother me everyday (before the Do Not Call List) and they always gave me the creeps.

    The appeals court also said the district court was wrong to grant Talk America's request for arbitration.
    Arbitration panels are usually loaded with industry folks and you, the consumer, will rarely get a fair shake.

    ...as well as how they use their personal information after mergers or acquisitions is one that privacy experts and others have been grappling with since the emergence of e-commerce in the 1990s.
    When I took a class on buying businesses, one of the ways to finance the deal was to sell off the customer list of the company you're acquiring - regardless of any privacy statement they may have stated to their customers. It's not just eCommerce sites. It's also the Mom and Pop bakery.

    I'm all for capitalism and business and everything, but, sometimes, some of the things that are done makes my stomach churn. It does give me some empathy and understanding for the anti-corp folks here, though.

    • Re: (Score:2)

      by Lumpy ( 12016 )
      how about that AT&T/Cingular states that RIGHT IN THEIR CONTRACT you agree to? Almost ALL contracts have the "this contract subject ot change without notice" clause in it. the only ones that do not are the ones that got smacked down because of it, banks for example, they got nailed decades ago for deceptive practices like this

    • Re: (Score:2)

      by Jay L ( 74152 )
      It always pisses me off that some web services say in their very long agreement that they have the right to change the terms at any time
      IIUC, this ruling doesn't apply to those contracts. This says a consumer has no general obligation to keep checking the contract. It doesn't say a consumer can't agree to assume such an obligation by, say, signing a contract.

      See analysis at http://pubcit.typepad.com/clpblog/2007/07/courts-s ays-aol.html [typepad.com]

    • Re: (Score:2)

      by Baricom ( 763970 )

      It always pisses me off that some web services say in their very long agreement that they have the right to change the terms at any time. I refuse to do business with those people.

      SourceForge reserves the right, at SourceForge's sole discretion, to change, modify, add or remove portions of these Terms periodically. Such modifications shall be effective immediately upon posting of the modified agreement to the website unless provided otherwise (e.g., when implementing major, substantive changes, SourceForge intends to provide users with up to fourteen days of advance notice). Your continued use of the SourceForge Sites following the posting of changes to these Terms will mean that yo

  • Almost all ISPs have posted Acceptable Use Policies that are subject to change at any time -- and they are considered to be part of the contract. I think that most ISPs are finished with fine tuning their AUPs, but for a while they had to be changed fairly frequently to close holes that spammers were exploiting to prevent their removal from the net.

  • Furthermore... (Score:4, Insightful)

    by keraneuology ( 760918 ) on Sunday July 29, 2007 @02:12PM (#20033265) Journal
    It should be illegal to impose unilateral changes to a contract without clearly highlighting and specifying the specific changes. In other words, simply providing a new copy of the contract should be considered to be a clear and unquestionable violation of basic contract law.

    • Consumers aren't lawyers. They can not be expected to read and understand all terms. Furthermore, the odds of a customer spotting a minor change (yet one that significantly alters the relationship) are slim to none. With no awareness (and full knowledge of that lack of awareness) there is no meaningful offer and therefore no meaningful acceptance. In other words there is no meeting of the minds.

    • Most of these unilateral changes are of the exclusive benefit to the provider - nothing of value is offered to the user of the service. In other words, the alteration of the contract (which brings about a new contract) is utterly and completely devoid of consideration, which should likewise be enough to render the contract null and void. The contracts are entirely too one-sided.

    • Many (if not most) of these changes fall well within the realm of being unconscionable. Again, enough to declare the contracts null and void. (If they would only revoke the license of any lawyer who signs off on any contract that violates these simple tenets it would take only a few days before fairness would reign).

    • It should be illegal to impose unilateral changes to a contract without clearly highlighting and specifying the specific changes...
      I would have shortened your message quite a bit:

      It should be illegal to impose unilateral changes to a contract.
      Period. Full Stop.

    • Re: (Score:2)

      by sepluv ( 641107 )

      Exactly. I've thought this should be unlawful for ages. If they just change the terms and attempt to enforce the new one, doesn't that count as fraud (if they are gaining something from the new contract anyway) given that the terms saying that they may change it at any time are invalid.

      Also, maybe asking someone to agree to a contract you know to be invalid (e.g.: because of lack of consideration) should be a crime, as such things are often used divisively.

      As you say there are also issues with a lack o

    • It should be illegal to impose unilateral changes to a contract without clearly highlighting and specifying the specific changes.

      No, replacing one reasonable adhesion contract with a second reasonable adhesion contract should remain legal. The law prohibits unconscionable contracts and protects the consumer in this regard in both the first and the second contract.
      • It isn't that contracts can't be changed, but that contracts shouldn't be changed without clearly highlighting and specifying the specific changes. Make all the changes you like, but make sure that all parties have at least a fighting chance to know what is different.
        • It isn't that contracts can't be changed, but that contracts shouldn't be changed without clearly highlighting and specifying the specific changes. Make all the changes you like, but make sure that all parties have at least a fighting chance to know what is different.

          That wouldn't work. Many contracts have an integration clause that means everything said or written in the past is now irrelevant and that the current contract represents a complete and final expression of the agreement. Also, there is the

          • Also, there is the general principle that people should read the new contract in its entirety

            How many people read the original contract in its entirety? Of those who do, how many understand what the contract says?

            highlights and other shortcuts should not be employed to avoid such a reading

            What possible objection could anybody have to be told "by the way, this is what we changed"?

            but like many well meaning politicians I think your proposed solution will have many unintended negative consequences.

            Hypot

            • What possible objection could anybody have to be told "by the way, this is what we changed"?

              Such a statement is meaningless and encourages bad habits. Unsophisticated consumers will falsely rely on such statements while the contract says that such statements are irrelevant. How does an irrelevant unenforcible statement help?

              The legal system is far and away too complex for the majority of the country. Lawyers have an average IQ around 130. The general population has an average IQ of 100. Lawyers write

    • Many (if not most) of these changes fall well within the realm of being unconscionable.

      If there's one thing I learned from my contracts professor, it is that "unconscionable" is just a word, and waving it around doesn't prove anything. It doesn't have any intrinsic meaning until you answer this question: Why is it unconscionable? Note that I'm not disagreeing, just requesting an explanation.

      Similarly, saying something is unconstitional is not a persuasive argument unless you explain why.

      Consumers aren't law

  • I wish there were just a standard form contract, (or a handful of standard form contracts,) so that each website didn't have a unique contract.

    • Re: (Score:2)

      by sepluv ( 641107 )

      I'm sure the lawyers would strike—or more likely find a reason by why such an idea would be unlawful. Imagine the lost revenue?

      Seriously someone should do this, a bit like the Creative Commons licenses (maybe they should do it). A problem I see is that most of the terms in these things are really unnecessary (even from the providers point of view) or adequately covered (or overridden) by legislation and full of waffling redundancy, so to do this you'd actually have to find out what they terms they

  • Uninteresting (Score:3, Interesting)

    by Cadallin ( 863437 ) on Sunday July 29, 2007 @02:18PM (#20033333)
    These "contracts" are mostly invalid in the first place. Conditions like "waving the right to sue" make them so. At least in the USA, you always have a right to sue, always. You may not win, but that's an entirely separate issue. A judge and/or jury is completely free to choose whether or not to take any such agreement into account or not. These are largely included as a psychological weapon, if you're dumb enough to think you can't sue, then you're less likely to.

    The conditions cited in this article are, however, particularly asinine. What if a car dealership could change the terms of the sale any time they wanted after the sale, without your approval? How well do you think that would hold up?

    • These "contracts" are mostly invalid in the first place.

      You are mistaken. Terms that require arbitration may be perfectly binding. Terms that are considered unconscionable and void would be those that are one sided. I believe one of the classic rulings on this matter was a situation where a company required arbitration but then retained the right to appeal. The right to appeal was what the judge considered one sided, not requiring arbitration in the first place.

    • Re: (Score:2)

      by AusIV ( 950840 )

      These "contracts" are mostly invalid in the first place. Conditions like "waving the right to sue" make them so.

      Correct me if I'm wrong, but I've been under the impression that having a contract with invalid conditions does not invalidate the entire contract.

      • It doesn't, but then exactly what makes most of these "web contracts" binding in any sense? For the most part they are intended to indemnify the company from charges of wrong-doing. I am making a leap here, but it is from "the main thrust of this contract is a group a conditions that no court will enforce" to "the contract is worthless." To reverse it a bit, what good is a contract to buy a kilo of Columbian Cocaine? What are you going to do if they don't follow through, sue them?

  • Big corporations heaving a big sigh of relief. (Score:4, Insightful)

    by 140Mandak262Jamuna ( 970587 ) on Sunday July 29, 2007 @02:20PM (#20033353) Journal
    The ruling affects only the contracts posted on line. The right of credit card companies, banks, brokerages, phone, electric and water utilities etc to include a piece of paper printed in unreadable font using ununderstandable language with their monthly bills and claim that their customers have been notified about the change in contracts will continue without any change.

    The online companies just have to include "Contract terms have changed Click here to read, click here to ignore it and go to the site" flash screen to comply with the new ruling.

    So it is all fine and wonderful and dandy in the corporate world, and peace and serenity will continue to reign in Ye Olde Country Club.

  • Update To My Credit Card Policies (Score:4, Funny)

    by nick_davison ( 217681 ) on Sunday July 29, 2007 @02:27PM (#20033429)
    Imagine if consumers could pull the same crap with changing contracts, updating terms and expecting the businesses to check online for any updates that businesses pull on consumers.

    Henceforth, the customer [Me] doesn't have to make any payments and will face no consequences for doing so. Further, the lender [You] agrees to assume existing and future debts whilst continuing an open line of credit. This was posted somewhere on the net so it's the lender's [your] obligation to check for it.

  • An agreement to agree is not an agreement (Score:5, Insightful)

    by Animats ( 122034 ) on Sunday July 29, 2007 @03:30PM (#20033873) Homepage

    This is a sound decision. There's a classic principle of English common law that says "an agreement to agree is not an agreement at all". A contract to agree to terms not yet defined is not an enforceable contract. This is standard contract law.

    The actual decision [uscourts.gov] says:

    Parties to a contract have no obligation to check the terms on a periodic basis to learn whether they have been changed by the other side. Indeed, a party can't unilaterally change the terms of a contract; it must obtain the other party's consent before doing so. Union Pac. R.R. v. Chi., Milwaukee, St. Paul & Pac. R.R., 549 F.2d 114, 118 (9th Cir. 1976). This is because a revised contract is merely an offer and does not bind the parties until it is accepted. Matanuska Valley Farmers Cooperating Ass'n v. Monaghan, 188 F.2d 906, 909 (9th Cir. 1951). And generally "an offeree cannot actually assent to an offer unless he knows of its existence." Samuel Williston & Richard A. Lord, A Treatise on the Law of Contracts 4:13, at 365 (4th ed. 1990); see also Trimble v. N.Y. Life Ins. Co., 255 N.Y.S. 292, 297 (App. Div. 1932) ("An offer may not be accepted until it is made and brought to the attention of the one accepting."). Even if Douglas's continued use of Talk America's service could be considered assent, such assent can only be inferred after he received proper notice of the proposed changes.

    Companies have been trying to get away with something that has no basis in law. Finally, someone sued on that issue, and won.

    The Register points out that this is consistent with UK law [theregister.co.uk]. That's not surprising. This goes back to ancient common-law traditions. The Register also points out that the issue of whether terms can be changed when the consumer has an ongoing obligation to the seller (like a cell phone service agreement) has been argued in Britain and decided in favor of consumers.

  • Wow! The Ninth Circuit finally got something right! And right there in technology's backyard, too!

  • that explains a lot.

    Still, the SCOTUS will fix^h^h^h overturn this soon.

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