3:24-cv-03741
N.D. Cal.Dec 2, 2024Background
- Plaintiff Jonathon Perry-Hudson used Keeps, a men’s hair loss treatment service, and alleges that Keeps wrongfully shared his personal information with Twilio, Inc. for targeted advertising purposes.
- Perry-Hudson sued Twilio for violations of privacy statutes and California common law, but did not sue Keeps.
- Twilio moved to compel arbitration, relying on an arbitration agreement in Keeps’s Terms & Conditions, to which Twilio argued Perry-Hudson assented while using Keeps’s website.
- Perry-Hudson opposed, arguing he did not agree to the arbitration clause and that Twilio, as a nonsignatory, could not enforce the agreement.
- The court considered whether Perry-Hudson received conspicuous notice of the arbitration clause and if Twilio could compel arbitration under theories of equitable estoppel.
- The court ultimately granted Twilio’s motion to compel arbitration, denied Twilio’s motion to dismiss as moot, and stayed the case pending arbitration.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the website provided reasonably conspicuous notice of the arbitration agreement | The website’s links to the Terms & Conditions were not sufficiently noticeable | The links and notice were reasonably conspicuous and just below the action button | The design provided reasonably conspicuous notice |
| Whether Perry-Hudson assented to the arbitration agreement | He did not manifest assent due to insufficient notice | He manifested assent by clicking “Continue” with an accompanying notice | Plaintiff was on inquiry notice and manifested assent |
| Whether Twilio, a nonsignatory, can enforce the arbitration agreement | Only signatories can compel arbitration | Twilio can compel arbitration under equitable estoppel | Twilio may enforce via equitable estoppel |
| Whether Plaintiff’s claims are intertwined with the agreement | Claims are unrelated to Keeps’s agreement | Claims rely on terms and obligations in the agreement and privacy policy | Claims are intertwined; estoppel applies |
Key Cases Cited
- Berman v. Freedom Financial Network, LLC, 30 F.4th 849 (9th Cir. 2022) (sets out standard for inquiry notice and assent to online terms)
- Keebaugh v. Warner Brothers Entertainment Inc., 100 F.4th 1005 (9th Cir. 2024) (emphasizes evaluating overall web design for conspicuous notice)
- Kramer v. Toyota Motor Corp., 705 F.3d 1122 (9th Cir. 2013) (articulates equitable estoppel test for arbitration by nonsignatories)
- Murphy v. DirecTV, Inc., 724 F.3d 1218 (9th Cir. 2013) (checks for interconnectedness of claims and agreements in arbitration context)
- Goldman v. KPMG, LLP, 173 Cal. App. 4th 209 (Cal. Ct. App. 2009) (addresses equitable estoppel and fairness in compelling arbitration)