Deleman v. HighLevel, Inc.
3:25-cv-01284
| M.D. Penn. | Jul 25, 2025Background
- Plaintiff John Michael Deleman operates a SaaS marketing business (EMA) and contracted with HighLevel, Inc. for digital marketing services.
- Deleman claims he started using HighLevel’s platform in 2019 under an oral agreement with the CEO, bypassing standard terms of service.
- On November 30, 2024, Deleman clicked to accept HighLevel's online terms of service to get a 50% discount, which included an arbitration clause, merger clause, and Texas forum selection.
- HighLevel terminated EMA’s account in June 2025, which Deleman alleges caused business losses and client disputes, leading Deleman to seek emergency injunctive relief and file suit.
- HighLevel removed the case to federal court and moved to compel arbitration under the terms of service.
- The court considered both motions (to compel arbitration, for injunctive relief) on a developed factual record under the summary judgment standard.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Assent to Arbitration Clause | Did not assent; claims did not “consider” terms of service. | Plaintiff clicked to accept; clickwrap valid under Texas law. | Assent found via clickwrap; arbitration clause applies. |
| Unconscionability of Arbitration Clause | Clause is unconscionable due to power imbalance and lack of negotiation. | Clickwrap agreements valid; unconscionability argument generic. | Clause not unconscionable under Texas law. |
| Effect of Prior Oral Agreement | 2019 oral agreement with CEO supersedes new terms. | Merger clause in 2024 terms of service supersedes prior agreements. | Merger clause bars reliance on prior oral agreement. |
| Scope of Arbitration Clause | Claims fall outside arbitration scope. | Any controversy “relating to” terms is arbitrable; AAA rules apply. | Scope is for arbitrator to decide under incorporated rules. |
| Preliminary Injunction (Irreparable Harm) | Business losses and reputational harm are irreparable. | Harm is economic and not irreparable; arbitration can provide remedy. | No irreparable harm shown; injunction denied. |
Key Cases Cited
- Kirleis v. Dickie, McCamey & Chilcote, P.C., 560 F.3d 156 (3d Cir. 2009) (strong federal policy favoring arbitration)
- Alexander v. Anthony Int'l, L.P., 341 F.3d 256 (3d Cir. 2003) (enforceability of arbitration agreements and contract law principles)
- Anderson v. Liberty Lobby, Inc., 477 U.S. 242 (1986) (summary judgment standard—material fact and genuine dispute)
- Prima Paint Corp. v. Flood & Conklin Mfg. Co., 388 U.S. 395 (1967) (severability principle in arbitration)
- Volt Info. Sciences, Inc. v. Bd. of Trustees of the Leland Stanford Junior Univ., 489 U.S. 468 (1989) (enforcement of arbitration agreements according to their terms)
- ECRI v. McGrawHill, Inc., 809 F.2d 223 (3d Cir. 1987) (economic harm generally not irreparable for injunctions)