Specht v. Netscape Communications

150 F.Supp. 2d 585 (2001)

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Nature of the Case

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Facts

Plaintiffs alleged that Defendant’s (Netscape) software transmitted private information about the users file transfer activity and that this was a violation of two federal statutes. Defendant contends that they can compel arbitration of the suits because their terms and conditions for the usage of the software compel binding arbitration. The clause on binding arbitration is found in the End User License Agreement, in the contract allegedly made by the offeror to the party affecting the download of the software. The SmartDownload software made it easier for users to download filed from the internet without losing their interim progress when they pause to engage in some other task. The SmartDownload software was obtained by hitting a download button. The only reference to a license agreement appears in text visible only if the party scrolls down through the page to the next screen. There is no requirement for anyone to assent to the license agreement before downloading the program. The terms of that agreement include a mandatory arbitration clause.