Swift v. Zynga Game Network, Inc.
2011 U.S. Dist. LEXIS 85983
| N.D. Cal. | 2011Background
- Swift filed a purported class action against Zynga and related defendants alleging deceptive 'special offers' in Zynga’s Facebook games, with claims under California unfair competition, CLRA, and unjust enrichment.
- Zynga moved to compel arbitration and stay litigation after Concepcion altered the legal landscape on class waivers in arbitration agreements.
- YoVille TOS (April 2009) contained an arbitration clause but was silent on class arbitration; Universal TOS (August 2009) required binding arbitration and barred class arbitration.
- Swift admitted clicking 'Accept' to the YoVille TOS, with a hyperlink to the terms; Zynga argued this constituted valid assent under modified clickwrap.
- The court considered whether the arbitration provisions apply to Swift and whether Zynga waived arbitration by litigating before Concepcion.
- The court granted Zynga’s motion to compel arbitration and stayed the litigation against Zynga and the Super Rewards Defendants; related discovery motions were moot.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Is there a binding arbitration agreement with Swift? | Swift contends there was no mutual assent to the arbitration terms. | Zynga argues assent via YoVille and Universal TOS, including hyperlink access and Accept button. | Yes; binding arbitration exists. |
| Did Zynga waive its right to compel arbitration by litigating first? | Zynga elected litigation and cannot later compel arbitration. | Waiting for Concepcion made an upfront election futile; no waiver occurred. | No waiver; no premature right to compel prior to Concepcion. |
| Are Swift’s claims expressly exempt from arbitration under the TOS? | Arising from theft allegations fall within an express exemption. | Theft is not plausibly alleged in the complaint and the exemption is not applicable. | Not expressly exempted. |
| Does the timing of arbitration availability under the TOS govern at the time the case was filed? | Class arbitration issues could not be altered by later changes in law. | Concepcion allows enforcement of arbitration post-change in law. | Governing law permits later arbitration under FAA. |
| Is the arbitration agreement enforceable where unconscionability is raised? | Arbitration terms may be procedurally/substantively unconscionable. | No procedural unconscionability shown and substantive concerns lack support. | Unconscionability fails; arbitration enforceable. |
Key Cases Cited
- AT&T Mobility LLC v. Concepcion, 131 S. Ct. 1740 (U.S. 2011) (FAA preempts Discover Bank; class waivers enforceable absent explicit class arbitration)
- Specht v. Netscape Communications Corp., 306 F.3d 17 (2d Cir. 2002) (notice insufficient where terms not presented on screen; clickwrap issues)
- Register.com, Inc. v. Verio, Inc., 356 F.3d 393 (2d Cir. 2004) (modified clickwrap can suffice when terms are accessible and assent is given)
- Amisil Holdings Ltd. v. Clarium Capital Management LLC, 622 F. Supp. 2d 825 (N.D. Cal. 2007) (non-signatories may enforce arbitration against signatories under agency theory)
- Britton v. Co-op Banking Group, 4 F.3d 742 (9th Cir. 1993) (agency-based arbitral enforcement principles guide non-signatory enforcement)