2015 Ohio 4411
Ohio Ct. App.2015Background
- Andrew Ranazzi used Intuit TurboTax 2013 and elected to convert part of his federal tax refund into Intuit-sponsored Amazon eGift Cards (including a 10% Intuit bonus); two eGift Cards were deposited to his Amazon account on April 9, 2014.
- Ranazzi attempted to use the eGift funds to buy smaller-denomination Amazon gift cards, learned the Intuit eGift Cards could not purchase other Amazon gift cards, and attempted to rescind but was refused.
- Ranazzi sued Amazon and Intuit in Toledo Municipal Court alleging violations of Ohio consumer protection statutes and deceptive trade practices.
- Amazon and Intuit moved to stay proceedings and compel arbitration, attaching employee affidavits explaining their online click/scrollwrap terms that included arbitration clauses and class-action waivers.
- The trial court granted the stay pending arbitration; Ranazzi appealed arguing lack of assent, improper scope, no consideration, unconscionability, and that his statutory claims could be decided without referencing the contracts.
- The Sixth District Court of Appeals affirmed, holding Ranazzi assented via clickwrap/scrollwrap, the dispute fell within the arbitration clauses, consideration was adequate, and the clauses were not unconscionable or against public policy.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Formation / Assent to arbitration | Ranazzi never actually saw or agreed to arbitration terms; clicking did not establish assent | Clickwrap/scrollwrap clicks manifest assent; registries and purchases put users on notice | Held: Clicking to accept terms constituted valid assent to arbitration clauses |
| Scope of arbitration | Dispute about eCard use is outside arbitration scope and can be decided without the contracts | Arbitration clauses broadly cover disputes relating to use of services/products | Held: Dispute arises from contract terms and falls within clause scope; arbitration applies |
| Consideration for arbitration agreement | No consideration exists to support enforcement of arbitration clauses | Mutual promises to arbitrate and option not to use services constitute consideration | Held: Mutual arbitration promises (and ability to decline services) provide sufficient consideration |
| Unconscionability / class-action waiver / public policy | Clauses are adhesive, one-sided, preclude class relief and thus violate public policy | Clauses offer fee protections, procedures, and are not unduly oppressive; FAA and precedent limit unconscionability findings | Held: Clauses are not procedurally or substantively unconscionable and do not violate public policy |
Key Cases Cited
- Hancock v. Am. Tel. & Tel. Co., 701 F.3d 1248 (10th Cir. 2012) (upholding clickwrap assent to arbitration)
- Fteja v. Facebook, Inc., 841 F. Supp. 2d 829 (S.D.N.Y. 2012) (hyperlinked terms and failure to read do not defeat assent)
- Nicosia v. Amazon.com, Inc., 84 F. Supp. 3d 142 (E.D.N.Y. 2015) (upholding Amazon arbitration clause and class waiver)
- DeJohn v. The .TV Corp. Int’l, 245 F. Supp. 2d 913 (N.D. Ill. 2003) (enforcing online agreements formed by clicking)
- Swift v. Zynga Game Network, Inc., 805 F. Supp. 2d 904 (N.D. Cal. 2011) (clickwrap assent binding even if user did not read terms)
- Alexander v. Wells Fargo Fin. Ohio 1, Inc., 122 Ohio St.3d 341 (Ohio 2009) (analysis of whether claims fall within arbitration clause)
- Hayes v. Oakridge Home, 122 Ohio St.3d 63 (Ohio 2009) (framework for procedural and substantive unconscionability)
- AT&T Mobility LLC v. Concepcion, 563 U.S. 333 (U.S. 2011) (FAA preempts state rules that prohibit class-action waivers in arbitration agreements)