U.S. Appeals Court Rules Against Netscape on End-User License Agreement

The U.S. Court of Appeals (2nd Cir.) recently considered whether Netscape customers were bound by the arbitration clause in an end-user license agreement. In Specht v. Netscape, Netscape customers sued the company alleging that AOL's plug-in software, Smart Download, invaded their privacy by transmitting personal information back to the software provider when the plug-in was used to browse the Internet. Arguing that the plaintiffs were bound by the arbitration provisions of the program's electronic license agreement, AOL brought a motion to compel arbitration and to stay court proceedings. The Court held that the plaintiffs were not bound by the terms of the agreement since they did not receive reasonable notice of the existence of its terms before acting on the defendants' invitation to download the software. For a copy of the decision, visit: http://laws.lp.findlaw.com/2nd/017860.html For more details, visit: http://news.com.com/2100-1023-960388.html