101 Cal.App.5th 1280
Cal. Ct. App.2024Background
- Five patients (and heirs) sued Dexcom after alleged Dexcom G6 CGM malfunctions caused serious injuries and one death; Dexcom moved to compel arbitration based on a clickwrap "I agree to Terms of Use" during G6 App setup.
- Dexcom submitted a privacy manager’s declaration and screenshots of the G6 App setup "Legal" screen showing a 3‑sentence paragraph stating that "by ticking the boxes" users understood their personal (including sensitive health) information would be collected/processed, with two checkboxes: "I agree to Terms of Use" and "I agree to Privacy Policy" (each hyperlinked to lengthy Terms/Policy webpages containing an arbitration clause).
- Dexcom attached three printed versions of its 22‑page Terms of Use (each containing the same arbitration clause) but did not show how the Terms appeared on users’ mobile screens or where the arbitration clause appeared on the scroll.
- Trial court granted Dexcom’s motions to compel arbitration in all five cases; plaintiffs petitioned for writs. The Court of Appeal consolidated the petitions, issued an order to show cause, requested supplemental briefing on the Legal screen text, and granted the petitions.
- On de novo review the court held Dexcom failed to prove formation of arbitration agreements: the Legal screen expressly tied the checkbox to consent to data collection/processing and thus undercut constructive notice and an unambiguous manifestation of assent to the full Terms of Use (including arbitration). The trial orders compelling arbitration were vacated.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether clickwrap created an arbitration agreement | The Legal screen text limited the checkbox to consent about data handling; click did not give constructive notice of the arbitration clause | Classic clickwrap: checkbox + visible hyperlink = enforceable assent to Terms (including arbitration) | No. Clickwrap was not shown to manifest assent to full Terms because the screen tied the click to narrowly framed privacy consent, defeating constructive notice and unambiguous assent |
| Whether the Legal screen gave reasonably conspicuous notice of arbitration | No — the visible language directed users to privacy/data‑processing understandings, so users had no reason to expect arbitration terms | Hyperlink in contrasting color under a checkbox is conspicuous and sufficient for inquiry notice | No. The court found the content (not just design) failed to put users on inquiry notice of arbitration |
| Whether ticking the checkbox was an unambiguous manifestation of assent to all Terms | Ticking was explicitly described as indicating understanding about data collection/processing only, creating ambiguity | Ticking the box next to "I agree to Terms of Use" unambiguously accepts the Terms | No. The screen’s text created two plausible meanings (narrow privacy consent vs. broad assent), so assent to arbitration could not be inferred |
| Whether Herzog (decedent) used the G6 App (so arbitration could apply) | Complaint did not actually allege Hebert used the G6 App; plaintiffs disputed Dexcom’s characterization | Dexcom argued complaints and app mechanics implied Hebert must have used the app and thus accepted Terms | The court held the complaint did not establish app use and Dexcom failed to prove the date/version needed to tie Hebert to a specific Terms version; therefore Dexcom did not prove formation as to Hebert |
Key Cases Cited
- Sellers v. JustAnswer LLC, 73 Cal.App.5th 444 (Cal. Ct. App. 2021) (internet contract formation requires conspicuous notice and unambiguous manifestation of assent)
- B.D. v. Blizzard Entertainment, Inc., 76 Cal.App.5th 931 (Cal. Ct. App. 2022) (context and presentation of online terms critical; scrollable popup and explicit advisals support notice)
- Long v. Provide Commerce, Inc., 245 Cal.App.4th 855 (Cal. Ct. App. 2016) (inquiry‑notice test for online agreements: conspicuous notice + unambiguous action)
- Sgouros v. TransUnion Corp., 817 F.3d 1029 (7th Cir. 2016) (website language can "undo" notice by telling users a click serves a different, specific purpose)
- Doe v. Massage Envy Franchising, LLC, 87 Cal.App.5th 23 (Cal. Ct. App. 2022) (context can make a clickwrap appear to relate only to discrete matters and not to broader terms)
- Specht v. Netscape Communications Corp., 306 F.3d 17 (2d Cir. 2002) (downloads of free software less likely to put users on notice of extensive terms)
- Pinnacle Museum Tower Assn. v. Pinnacle Market Development (US), LLC, 55 Cal.4th 223 (Cal. 2012) (party seeking arbitration bears burden to prove existence of agreement)
- Engalla v. Permanente Medical Group, 15 Cal.4th 951 (Cal. 1997) (existence of arbitration agreement is petitioner's burden)