Arnaud v. Doctor's Associates, Inc., 19-3057-cv

Plaintiff Luis Arnaud received unsolicited text messages and filed a putative class action under the TCPA against Defendant Doctor’s Associates, Inc. (Subway).
Subway moved to compel arbitration, arguing Arnaud agreed to Subway’s online terms (including an arbitration clause) by entering his phone number on a promotional webpage and clicking an “I’M IN” button to receive a coupon; the promotional page contained a hyperlinked "T & Cs" to the full terms.
The District Court denied the motion, concluding the webpage did not put a reasonable user on inquiry notice of the hyperlinked terms because the page was cluttered, the link was small and at the bottom, and the page used only the shorthand "T & Cs" without language indicating assent by clicking "I’M IN."
Subway appealed, arguing the District Court applied the wrong conspicuousness standard and that Arnaud’s lack of an affidavit meant he failed to create a factual dispute about actual notice.
The Second Circuit reviewed de novo whether the parties agreed to arbitrate, applied New York contract-formation law, and analyzed whether the webpage’s design rendered the terms reasonably conspicuous.
The Second Circuit affirmed the District Court: the link and page design did not give inquiry notice of the arbitration term, and Subway had not produced evidentiary facts requiring Arnaud to submit proof contradicting actual notice.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether clicking “I’M IN” and providing a phone number formed assent to hyperlinked terms including arbitration	Arnaud: webpage design did not put a reasonable user on inquiry notice; no assent to arbitration	Subway: entering phone number and clicking constituted assent to T&Cs accessible via hyperlink	Court: No—page design (clutter, small "T & Cs" link, no assent language) failed to give inquiry notice, so no contract formed
Whether District Court applied incorrect standard for conspicuousness	Arnaud: District Court applied correct inquiry-notice standard under NY law and controlling precedent	Subway: District Court used too stringent a test; link was sufficient	Court: District Court applied correct standard and precedent (Nicosia, Meyer, Starke); its factual assessment stands
Whether Arnaud’s failure to submit an affidavit defeated his denials of actual notice	Arnaud: Subway had not produced evidentiary facts showing actual notice, so Arnaud need not submit proof	Subway: Arnaud’s general denials were insufficient without an affidavit	Court: Subway failed to substantiate actual notice; thus Arnaud did not need to submit evidentiary proof at this stage

Specht v. Netscape Commc’ns Corp., 306 F.3d 17 (2d Cir. 2002) (standard for reviewing denials of motions to compel arbitration)
Collins & Aikman Prods. Co. v. Bldg. Sys., Inc., 58 F.3d 16 (2d Cir. 1995) (federal policy favors arbitration but threshold is whether parties agreed)
Schnabel v. Trilegiant, 697 F.3d 110 (2d Cir. 2012) (threshold question: whether parties agreed to arbitrate)
Starke v. SquareTrade, Inc., 913 F.3d 279 (2d Cir. 2019) (use web interface design to assess inquiry notice under state contract law)
Nicosia v. Amazon.com, Inc., 834 F.3d 220 (2d Cir. 2016) (webpage design and conspicuousness of hyperlinked terms can be dispositive)
Meyer v. Uber Techs., Inc., 868 F.3d 66 (2d Cir. 2017) (sparse interface and spatial coupling of assent language with button can create inquiry notice)
Oppenheimer & Co. v. Neidhardt, 56 F.3d 352 (2d Cir. 1995) (party seeking arbitration must substantiate entitlement with evidentiary facts before opponent must submit contrary evidence)