[00:00:02] Speaker 03:
We will move on to Chabola versus Claspass.

[00:00:24] Speaker 03:
And once you get settled, Mr. Schatz, when you're ready.

[00:00:39] Speaker 04:
Good morning, Your Honors.

[00:00:40] Speaker 04:
Good morning.

[00:00:41] Speaker 04:
May it please the Court, Benjamin Schatz of Monat, Phelps, and Phillips for Defendant Appellant Class Pass.

[00:00:49] Speaker 04:
I'd like to reserve six minutes for rebuttal.

[00:00:51] Speaker 03:
Very well.

[00:00:52] Speaker 04:
This Court should reverse the District Court and order Chibola to arbitration because exercising de novo review and applying the governing inquiry notice standard from this Court's Berman opinion

[00:01:06] Speaker 04:
This Court should recognize that class-passes webpages provided reasonably conspicuous notice of its terms of use and Chibola unambiguously manifested assent to those terms.

[00:01:20] Speaker 04:
The parties do not dispute that the standard of review is de novo.

[00:01:25] Speaker 04:
The parties do not dispute the underlying relevant facts.

[00:01:28] Speaker 04:
And the parties do not dispute that the governing legal test is the inquiry notice test.

[00:01:34] Speaker 04:
So under the inquiry notice test, the questions presented are, did the class pass's webpage provide reasonably conspicuous notice of the terms, and did Shibola unambiguously manifest contractual assent?

[00:01:45] Speaker 04:
and a review of the web pages and the entirety of the enrollment process and the full context of the transaction shows that the answers to those questions have to be yes.

[00:01:57] Speaker 04:
The undisputed facts are simply that Shibola visited the ClassPass website, she clicked through four pages, three of which had the terms of use under the action button, and she went through the entire process and created an account

[00:02:14] Speaker 03:
Well, they were under, but there was things between the action button and the terms.

[00:02:28] Speaker 03:
Wasn't there?

[00:02:29] Speaker 02:
Especially as to page one.

[00:02:32] Speaker 04:
So looking at screen one.

[00:02:36] Speaker 04:
To answer your question, I think the pages are remarkably clean.

[00:02:39] Speaker 04:
There's not very much, there's no fluff inserted between any of this.

[00:02:45] Speaker 04:
So on page one, that's the page where Chibola was asked to enter her email address and then click either continue or sign up with Facebook and she clicked continue.

[00:02:57] Speaker 04:
And immediately under those two buttons it says

[00:03:00] Speaker 03:
But hold on, but isn't that kind of important?

[00:03:03] Speaker 03:
The location, right?

[00:03:04] Speaker 03:
The location here, the action item here, why can't we just assume that the person was just typing in their email or signing up for Facebook?

[00:03:14] Speaker 03:
How do we know then, based on Berman, that they're agreeing to a contract at this point by doing that which is requested of the page?

[00:03:25] Speaker 04:
because there's a notice right under the buttons that says if you do that you are agreeing to the terms uh... and the standard is the the prudent average reasonable internet user and people who use the internet which is everybody these days know how to enroll and know how to do these sorts of things and it's the the

[00:03:47] Speaker 04:
Notice text and the terms of use are directly within the line of sight and the vision of the user, and they're in a box.

[00:03:56] Speaker 01:
It certainly would have been unambiguous if the button had followed the notice.

[00:04:03] Speaker 01:
The button does follow the notice on screen, too.

[00:04:07] Speaker 04:
That's true.

[00:04:10] Speaker 04:
Web pages are done in many different ways, and the case law always says as long as the notice and the terms are adjacent to, then that's good enough.

[00:04:24] Speaker 01:
It doesn't have to be above.

[00:04:25] Speaker 01:
And the button follows the notice on screen three.

[00:04:29] Speaker 01:
That's true.

[00:04:30] Speaker 01:
And at what point is she enrolled?

[00:04:32] Speaker 01:
She has to scroll through all three

[00:04:35] Speaker 01:
all of these pages and she has to click all three buttons?

[00:04:39] Speaker 04:
To have a membership, yes.

[00:04:41] Speaker 04:
Okay, so to sign up for this.

[00:04:43] Speaker 04:
To sign up for this, which she does because it's the last page in which she inputs all of her credit card information.

[00:04:49] Speaker 03:
uh... and at that point uh... it should be clear to anyone that they have made a contract but at the second page uh... at the second page the big test text i should say uh... it's it's indicating just for her name so that there's big test

[00:05:06] Speaker 03:
What is your name, question mark, and then the person is asked to enter their information, and yes, the terms of use is underneath that, but in smaller print, and it is highlighted, and then there's a continue button, the action item.

[00:05:25] Speaker 03:
So in your view, you're saying that at that point then, the person has entered into a contract.

[00:05:33] Speaker 03:
Our view is that on all three pages,

[00:05:36] Speaker 04:
she's entered into a contract because she has clicked buttons directly adjacent to notice language saying that if she does that, she's agreeing to the terms.

[00:05:45] Speaker 04:
But, you know, it's not actually necessary to decide when the contract was formed.

[00:05:52] Speaker 04:
Was it page one?

[00:05:53] Speaker 04:
Was it page two?

[00:05:54] Speaker 04:
Was it page three?

[00:05:55] Speaker 01:
Because it... There isn't anything to do until you get to page three, right?

[00:05:59] Speaker 01:
I mean, it's not until you've actually clicked the button on page three that she has any obligations.

[00:06:04] Speaker 01:
She's just agreed to terms of use, but that doesn't mean anything, right?

[00:06:08] Speaker 01:
If she only clicks the button on page one, what happens?

[00:06:13] Speaker 01:
Well, she has agreed to the terms of use.

[00:06:16] Speaker 01:
Right, but for what?

[00:06:18] Speaker 01:
Precisely.

[00:06:18] Speaker 01:
She's not going to any classes.

[00:06:19] Speaker 01:
They're not collecting any money from her, right?

[00:06:21] Speaker 04:
Right, so no dispute.

[00:06:22] Speaker 01:
Are they collecting any money if she clicks both button on page one and page two?

[00:06:27] Speaker 04:
Right, so no dispute would arise if someone just went to the first page.

[00:06:31] Speaker 03:
That's really not your position, is it, that at the moment that they enter their name now, they've agreed to the terms and conditions?

[00:06:37] Speaker 03:
Is that what your position is?

[00:06:39] Speaker 04:
Yes, but we don't have to die on that hill.

[00:06:42] Speaker 04:
I mean, we don't even have to have that discussion because we know here she went all the way through and signed up and then took a survey about what classes she wanted to take.

[00:06:51] Speaker 04:
And then she took classes and she paid.

[00:06:54] Speaker 04:
And then when ultimately 15 months later when she had a dispute and wanted a refund and emailed customer service at ClassPass, she said, I have to be honest with you.

[00:07:03] Speaker 04:
I get that you have terms of service.

[00:07:05] Speaker 04:
I mean, there's no question that she knew what she was doing.

[00:07:09] Speaker 04:
and that by the time she reached the end, she had to have accepted those terms of use.

[00:07:17] Speaker 04:
And Your Honor pointed out, well, the terms of use is in a smaller type font.

[00:07:22] Speaker 04:
But that's true in all of the cases.

[00:07:25] Speaker 04:
And so we have provided many, many screenshots in our brief to show that this is a perfectly normal

[00:07:34] Speaker 04:
an ordinary way that e-commerce is done.

[00:07:38] Speaker 04:
And we've cited cases from this court, not just the Berman case that sets the standard, but the three published cases that have followed, Oberstein, Patrick, and Kebaugh.

[00:07:49] Speaker 04:
And there are also four unpublished decisions from this court showing that that standard is very well understood.

[00:07:57] Speaker 04:
And that's Dorman, Lee, Alcaraz,

[00:08:03] Speaker 04:
And then beyond that, we've cited... Well, hold on.

[00:08:05] Speaker 03:
In Oberstein, wasn't the notice conspicuously displayed directly above and below the action item?

[00:08:14] Speaker 03:
And that's not the case here.

[00:08:16] Speaker 03:
And that was in three different locations.

[00:08:18] Speaker 03:
So isn't that distinguishable?

[00:08:21] Speaker 04:
I don't think so, no, because Oberstein has the text notice right next to the button, and it has it in three different screens, and that's just like this case, where there are three screens.

[00:08:33] Speaker 03:
I'm looking at the first screen.

[00:08:35] Speaker 03:
That's not the case, counsel, is it?

[00:08:37] Speaker 03:
You're looking at the— The first screen.

[00:08:40] Speaker 04:
The first screen.

[00:08:41] Speaker 03:
Email.

[00:08:41] Speaker 03:
Enter your email.

[00:08:42] Speaker 03:
I'm looking at it right now, and it has

[00:08:45] Speaker 03:
Enter your email to continue.

[00:08:47] Speaker 03:
You enter your email and has the action item immediately below that says continue.

[00:08:52] Speaker 03:
So right, let's just stop there.

[00:08:54] Speaker 03:
That's distinguishable from overseeing where it was immediately under it.

[00:09:00] Speaker 03:
Isn't that accurate?

[00:09:01] Speaker 04:
Yes, that's true, but immediately under continue is or and there's another button and that's not uncommon.

[00:09:07] Speaker 04:
We've cited many web screens where when someone is clicking to advance there are several options of buttons and it sounds like maybe what your honor is saying is that the notice text should be under each

[00:09:17] Speaker 03:
No, I guess what I'm saying is what you indicated is that overseeing is on all fours here and that we should follow it.

[00:09:23] Speaker 03:
But when we follow it, it is distinguishable in that context.

[00:09:26] Speaker 03:
And placement matters, certainly as we're looking at this.

[00:09:32] Speaker 03:
Doesn't that matter?

[00:09:33] Speaker 04:
Yes, placement does matter.

[00:09:35] Speaker 04:
And I would say that the placement is equivalent.

[00:09:38] Speaker 04:
And I'm not saying that Oberstein is exactly this case.

[00:09:41] Speaker 04:
I mean, all of these cases are different.

[00:09:42] Speaker 04:
Every single web page is different.

[00:09:44] Speaker 04:
I have another case where somebody is saying, well, the button was orange, and that distracted the user.

[00:09:49] Speaker 04:
I mean, it devolves into very ridiculous arguments about details.

[00:09:54] Speaker 04:
But what really matters is if you look at this court's precedent,

[00:09:57] Speaker 04:
As long as the notice text is next to the button and the user presses the button, then that's going to be sufficient.

[00:10:07] Speaker 04:
And we've cited many, many district court cases that say the same thing, two of which are from Judge Fitzgerald.

[00:10:14] Speaker 04:
So we know he has seen this before.

[00:10:16] Speaker 04:
And nobody has picked these things apart.

[00:10:21] Speaker 04:
uh... in the way that that that the district court judges as has tried to do here and that the other side has tried to do and it's worth pointing out that the other side doesn't have any any case law we've got a well over twenty cases that say look at look at our our page and it looks like this page like cases should be treated alike and uh... the the the there should be the agreement should be enforced council with oversteen

[00:10:47] Speaker 02:
The it isn't necessarily whether screen one matches there, but the point of the case was that even if there would be issues that collectively the the process would would meet the prongs of Berman.

[00:11:01] Speaker 02:
So let's say that we disagree with you about screen one.

[00:11:05] Speaker 02:
What in your view.

[00:11:07] Speaker 02:
would be the reasons that Screen 2 and Screen 3 under Oberstein would correct that, knowing that you disagree with that, but still would correct any issues that we see in Screen 1.

[00:11:21] Speaker 04:
Because it's not just about one screen.

[00:11:23] Speaker 04:
It's actually about four screens.

[00:11:24] Speaker 04:
Remember there was a landing page that she started with where she clicked a radio button to pick a collection of classes.

[00:11:32] Speaker 04:
That didn't have the terms of use.

[00:11:34] Speaker 04:
These pages did.

[00:11:35] Speaker 04:
But you have to look at everything together.

[00:11:37] Speaker 04:
It's the full context of the transaction.

[00:11:40] Speaker 04:
All of the cases say that.

[00:11:41] Speaker 04:
You have to look at everything.

[00:11:43] Speaker 04:
And the equivalent analogy here would be if somebody had a three-page contract and wanted to get out of it and said, oh, well, page one isn't the contract, so that's no good.

[00:11:52] Speaker 04:
And page two isn't the contract, and that's no good.

[00:11:55] Speaker 04:
And page three, well, yeah, I signed that, but that doesn't have the other terms.

[00:11:59] Speaker 04:
That's not how contracts work.

[00:12:00] Speaker 04:
It's all together.

[00:12:01] Speaker 04:
And there's no question that each of these pages flows from the other and builds upon the page that came before.

[00:12:08] Speaker 03:
Now, Council, I know you wanted to save some time.

[00:12:12] Speaker 03:
Do you want to save the remainder of your time?

[00:12:14] Speaker 04:
I do, unless the Court has a pressing question.

[00:12:17] Speaker 03:
I will have questions afterwards, I'm sure.

[00:12:19] Speaker 04:
Okay.

[00:12:19] Speaker 04:
Thank you.

[00:12:32] Speaker 03:
Good morning.

[00:12:33] Speaker 00:
Good morning.

[00:12:33] Speaker 00:
Good morning, Your Honors.

[00:12:35] Speaker 00:
Jessica Hunter on behalf of Plaintiff Appellee Catherine Chavala.

[00:12:39] Speaker 00:
There are a couple things I want to correct, but first I don't want to distract from the main, the critical issues here as the panel well recognizes.

[00:12:50] Speaker 00:
As the website operator, ClassPass has the onus of designing the webpage in a way that gives the consumer, in this case, the appellee, reasonably conspicuous notice and captures an unambiguous manifestation of scent.

[00:13:05] Speaker 03:
Well, let's go to his point, though.

[00:13:07] Speaker 03:
His point is, hey, if you look at screen two and screen three, the action item is below the terms and conditions listed.

[00:13:15] Speaker 03:
Why isn't that enough?

[00:13:16] Speaker 00:
So we'll start with screen two.

[00:13:20] Speaker 00:
if that's all right, which is almost identical to screen one.

[00:13:24] Speaker 00:
The only thing that changes is this request for an email address versus a name.

[00:13:30] Speaker 00:
And then, you know, as you rightly pointed out, the location of the button versus the notice text.

[00:13:37] Speaker 00:
But other than that, this is not a sign-up page.

[00:13:41] Speaker 00:
This is still just a preliminary attempt

[00:13:45] Speaker 00:
to offer a deal for $40 in this case.

[00:13:48] Speaker 01:
But it tells her, if you're signing up, you're going to agree to our terms of use.

[00:13:52] Speaker 01:
Do you wish to continue?

[00:13:54] Speaker 01:
And the button is below that.

[00:13:56] Speaker 01:
So why isn't that for a reasonably prudent internet user?

[00:14:00] Speaker 01:
Why isn't that sufficient to say, if you click this button, you accept our terms of use?

[00:14:05] Speaker 01:
That's pretty standard stuff.

[00:14:08] Speaker 01:
None of us are going to read this stuff, and we're not naive.

[00:14:12] Speaker 01:
Nobody's actually going to read this, but it's there.

[00:14:16] Speaker 00:
So I think Berman is crystal clear on this issue.

[00:14:19] Speaker 00:
The notice text needs to be connected to the button in a way that explains the legal significance to their user.

[00:14:28] Speaker 01:
What more did they have to say?

[00:14:30] Speaker 01:
What else was legally required on screen two?

[00:14:32] Speaker 01:
And then we get to screen three.

[00:14:34] Speaker 00:
For instance, I mean, I think I could go into other reasons why I might think this might not be enough, but if it had said by clicking continue below or by continuing past this page, you agree to our terms, that would certainly be better.

[00:14:51] Speaker 00:
Here it says sign up, but there's nothing on this page that indicates that this is a sign up page.

[00:14:57] Speaker 01:
Well, except that they're asking for your name.

[00:14:59] Speaker 01:
That's usually what we do when we sign up.

[00:15:00] Speaker 01:
That's usually the first thing that's requested.

[00:15:03] Speaker 01:
They asked for a first name and a last name.

[00:15:04] Speaker 01:
That's all that was asked?

[00:15:07] Speaker 01:
What is your name?

[00:15:08] Speaker 01:
That feels like that's signing up.

[00:15:10] Speaker 00:
Well, so there's a couple of points I'll make.

[00:15:13] Speaker 01:
And there's nothing else requested.

[00:15:16] Speaker 01:
Nobody's asking for any other information.

[00:15:17] Speaker 01:
No phone number, no social security number, no credit card number.

[00:15:21] Speaker 00:
Right, which is exactly a reason why I think this is not clearly a sign up page.

[00:15:25] Speaker 00:
There's nothing that says sign up.

[00:15:26] Speaker 00:
There's nothing that says create security questions.

[00:15:29] Speaker 00:
There's nothing that says create a password.

[00:15:32] Speaker 00:
It's simply asking for your name.

[00:15:34] Speaker 00:
And Your Honor, you may have had this experience of, you know, looking at some sort of service or product on a website, and it asks for your name, and the next page you get is a personalized further pitch that says, Judge Bybee, please, you know, sign up for this.

[00:15:50] Speaker 00:
I don't think that providing a name.

[00:15:52] Speaker 03:
And I'm sure you put your name, Judge Bybee.

[00:15:53] Speaker 03:
Yes, exactly.

[00:15:55] Speaker 00:
First name and last name, right?

[00:15:57] Speaker 00:
So I don't think that this simply asking for a name is a sign-up process.

[00:16:04] Speaker 00:
And if you take this out of the electronic contracting world, you know, think about going to an open house if you're trying to buy a house.

[00:16:11] Speaker 00:
You have to write down your contact information, your name, your email.

[00:16:15] Speaker 00:
You're not agreeing to buy that house by doing that.

[00:16:19] Speaker 01:
The contract really is not formed in any significant way until you get to page three.

[00:16:24] Speaker 00:
I mean, I would say there's not a contract formed at all,

[00:16:28] Speaker 01:
There's no contract formed here?

[00:16:30] Speaker 00:
For terms, there's a contract for the 40% discounted trial offer of a month of discounted fitness classes at local providers.

[00:16:43] Speaker 00:
But I know I don't agree that on page three that there's acceptance of the terms.

[00:16:49] Speaker 01:
I understand that my membership will automatically renew to the $75 per month plan applicable tax until I cancel.

[00:16:55] Speaker 01:
I agree to the terms of use and then a button below that says redeem now.

[00:17:00] Speaker 01:
That's the only button that will make all of this effective.

[00:17:02] Speaker 01:
That's just where you entered your card information.

[00:17:06] Speaker 00:
Right.

[00:17:07] Speaker 00:
You're correct that redeeming now is the button that redeems the trial offer that's been made.

[00:17:13] Speaker 00:
But Berman is clear that the legal significance of that click has to be explained to the consumer.

[00:17:21] Speaker 00:
It has to be explicit.

[00:17:23] Speaker 00:
And it has to be an unambiguous manifestation of assent.

[00:17:27] Speaker 01:
And redeeming now is not manifestation of her assent?

[00:17:31] Speaker 01:
What did she think she was doing?

[00:17:33] Speaker 00:
That's assent to the offer, which was $40 off of- Right.

[00:17:37] Speaker 01:
And one of the conditions was, I agree to the terms of use.

[00:17:41] Speaker 01:
Your Honor, I- That is the last sentence before the button.

[00:17:46] Speaker 00:
Which is another point.

[00:17:47] Speaker 00:
I mean, there are arguments that this is, again, not reasonably conspicuous notice.

[00:17:52] Speaker 00:
set off after another sentence.

[00:17:57] Speaker 01:
It's just too much to ask him to read two sentences?

[00:18:00] Speaker 00:
Well, Your Honor, this is a page that has lots of other text.

[00:18:04] Speaker 00:
It has a legal copy on the left.

[00:18:06] Speaker 01:
It doesn't, counsel.

[00:18:06] Speaker 01:
The whole thing is set off on the right.

[00:18:08] Speaker 01:
Yes, there's other information here.

[00:18:10] Speaker 01:
But this is not a particularly confusing.

[00:18:14] Speaker 01:
We just see these kinds of things all the time.

[00:18:16] Speaker 01:
Look, I'm not very technologically savvy.

[00:18:18] Speaker 01:
But even I can fill this page out without a clerk.

[00:18:24] Speaker 00:
Thank you, thank you for clarifying.

[00:18:28] Speaker 00:
Again, I just, I want to go back to Berman.

[00:18:33] Speaker 02:
Well, if I could ask you before doing that on, let me ask the same question that I asked Mr. Schatz, and that's how, why, even if we agreed with you as to screen one,

[00:18:46] Speaker 02:
If, as Judge Bybee was saying, screen three is perhaps the most significant, and under overseeing, we're supposed to look at all of the whole entire process, why would that process, by the time you get to screen three, not be sufficient?

[00:19:02] Speaker 00:
So that's a great question.

[00:19:04] Speaker 00:
The first two pages are a preliminary offer.

[00:19:08] Speaker 00:
It's a pitch to learn more about this exclusive deal that's being offered.

[00:19:14] Speaker 00:
It's not till the end that, as the panel has rightly pointed out, it's not till the end that you effectuate anything that you put in financial information.

[00:19:22] Speaker 00:
Without that, nothing is really going to happen unless you go through with that last page.

[00:19:28] Speaker 00:
So there's no reason on these first two pages that a consumer needs to be or would be on alert for the fact that an 11,000 word

[00:19:39] Speaker 00:
while more than 20 page contract is being formed.

[00:19:43] Speaker 00:
There's plenty of information on page three that is not disclosed until you get there.

[00:19:48] Speaker 00:
And I think Sellers is clear that if you're going to just try and bind someone by

[00:19:59] Speaker 00:
making that through an action that they would otherwise have to take, which here she otherwise has to take this action both to learn more and to get to the point where she can ultimately decide to accept it.

[00:20:12] Speaker 00:
There's no reason that she should be looking for the contract on that page, and I don't think once we get to page three that we can

[00:20:20] Speaker 00:
either expect her to go back, say, oh, what was on those pages?

[00:20:24] Speaker 00:
Was there anything when it wasn't the contractual nature at the time she was on those pages wasn't clear?

[00:20:31] Speaker 00:
So just at page three, and I'm repeating myself, but there's no reason to go back now that you've decided.

[00:20:39] Speaker 03:
So in your mind, so if there were a page that had

[00:20:43] Speaker 03:
Enter your email, enter your name, enter your email, and enter your financial information, and then indicate by signing up you agree to these terms, and then the action button, that would be sufficient.

[00:21:00] Speaker 03:
You agree with that.

[00:21:02] Speaker 00:
Certainly, if the action button said sign up, if it said continue, it might be a closer question.

[00:21:07] Speaker 00:
I'd have to see it.

[00:21:08] Speaker 00:
It's all fact intensive, but yes.

[00:21:10] Speaker 03:
This goes to Judge Fitzgerald's question, which is the fact that they're in three separate pages, that that is not enough, is what you're saying.

[00:21:21] Speaker 00:
I don't think that the fact that there are links to the terms on three separate pages really

[00:21:27] Speaker 00:
does anything for ClassPass here.

[00:21:28] Speaker 01:
This is another- The fact that it was repeated three times, out of four pages you had three different pages to figure out that you were going to be signing up, accepting their terms of use.

[00:21:39] Speaker 00:
This is another way that this case is distinguishable from Oberstein.

[00:21:42] Speaker 00:
That one said, sign up, sign in, and then purchase.

[00:21:46] Speaker 01:
As I've said, these first two pages- Are you suggesting that the fact that they repeated it on three pages is actually more likely to confuse her?

[00:21:55] Speaker 00:
No, not more likely to confuse her, just that the first two pages.

[00:22:00] Speaker 01:
So one page could have been sufficient.

[00:22:02] Speaker 01:
Is three pages worse than one page or better than one page for giving notice to the consumer?

[00:22:09] Speaker 00:
I'm not sure that it's really either.

[00:22:13] Speaker 00:
It depends on what the page looks like and what's being asked of the consumer on that page.

[00:22:18] Speaker 00:
I, you know, again, I would have to, of course, see the actual example to give you my wholesome opinion on any of these.

[00:22:26] Speaker 00:
But they could bind her on the first page if they really wanted to.

[00:22:32] Speaker 00:
I wouldn't, you know, rule that out.

[00:22:36] Speaker 00:
But you'd really have to ratchet up the level of notice that's being provided.

[00:22:40] Speaker 00:
You know, you'd have to hit the consumer over the head with the fact that you are agreeing at this preliminary stage

[00:22:49] Speaker 00:
to our 11,000 word contract when you haven't even made a decision whether you want to take us up on the deal that we're offering you and we haven't provided all the information about that deal.

[00:22:59] Speaker 00:
I think it's theoretically possible that it could be done, but I don't think it was done here.

[00:23:06] Speaker 02:
Council, Mr. Schatz mentioned the post-Burman cases, both from the Ninth Circuit and then the district courts.

[00:23:15] Speaker 02:
Is there a particular case that you feel the reasoning, obviously not binding, of course, but the reasoning is helpful to the position you're taking here, post-Burman?

[00:23:28] Speaker 00:
I mean, sure.

[00:23:29] Speaker 00:
I think one thing that council makes a point of is saying that this is

[00:23:36] Speaker 00:
She's signing up for a recurring membership, and the fact that it's not a trial, when in fact it is.

[00:23:42] Speaker 00:
If you look at something like Heba versus Warner Brothers, the court there is saying in that case that this was a game that was downloaded.

[00:23:52] Speaker 00:
Downloading something to your phone is something different than just being on a web page once.

[00:23:58] Speaker 01:
Do you have any case that involves a term of service or terms of use?

[00:24:04] Speaker 00:
So in that case that I just mentioned, the connection is play the game, play.

[00:24:13] Speaker 00:
And by tapping play, I agree.

[00:24:16] Speaker 00:
But there, the court made the point that this is not a web page.

[00:24:19] Speaker 00:
It's an app that the person is downloading.

[00:24:21] Speaker 00:
They intend to keep.

[00:24:23] Speaker 00:
Also, they're

[00:24:30] Speaker 00:
There's very minimal text on those pages.

[00:24:32] Speaker 00:
So if you're looking at that, the text that you're going to read is the text that is important.

[00:24:38] Speaker 00:
Here, there's lots of other things that are important to the other purpose that the consumer has here, which is not to sign an 11,000-word contract.

[00:24:46] Speaker 00:
It's to investigate this deal.

[00:24:49] Speaker 00:
So your eye is drawn to things on the left.

[00:24:51] Speaker 01:
Would that suggest then that CLASPAC should have added more pages here?

[00:24:57] Speaker 01:
This should have been maybe 10 or 11 or 12 pages.

[00:25:01] Speaker 01:
If we had 12 screens, three of which had buttons and used the term of use, we would have been better off here.

[00:25:07] Speaker 00:
No, I don't agree with that.

[00:25:09] Speaker 00:
I think from a consumer perspective, that length may wear the consumer down.

[00:25:15] Speaker 01:
I think that's right.

[00:25:16] Speaker 01:
But at some point, they've got to be able to convey certain kinds of information as to what they're promising to give you and what you're promising to give them.

[00:25:24] Speaker 00:
Right.

[00:25:25] Speaker 00:
So again, they could

[00:25:27] Speaker 00:
Overseen, for example, is a case where the person is creating an account, then signing into the account, then checking out, and all of that was clearly labeled, and that was the purpose of those pages.

[00:25:38] Speaker 01:
This could all be solved, couldn't it, very, very easily if we just required a separate button that says, I agree to your terms of use.

[00:25:46] Speaker 00:
Absolutely.

[00:25:47] Speaker 01:
But we have said that that's the one thing you don't have to do.

[00:25:50] Speaker 01:
We've made that pretty clear, haven't we?

[00:25:53] Speaker 01:
That would solve all of the problems if we just said, have a separate, I agree to the terms of use button.

[00:26:00] Speaker 01:
But no court has ever required that.

[00:26:03] Speaker 01:
Is that correct?

[00:26:04] Speaker 00:
I would agree with that, Your Honor.

[00:26:05] Speaker 00:
It would solve the problem.

[00:26:07] Speaker 00:
I think that the law has been clear that that would solve the problem.

[00:26:11] Speaker 00:
So a website designer like ClassPass should know that if they want to not be here in front of you, that they could do that.

[00:26:19] Speaker 00:
They didn't do it.

[00:26:22] Speaker 00:
Because of that, they're the ones taking the risk that a reasonable internet user has not had reasonably conspicuous notice and has not manifested an ambiguous manifestation of a scent.

[00:26:37] Speaker 02:
Council, implicit in that question and some of the other questions that my colleagues have asked is the concern that what you're really doing is asking us to sort of decree certain magic words that have to be used.

[00:26:51] Speaker 02:
And this court passed up the opportunity, I suppose, to do that in Berman.

[00:26:57] Speaker 02:
In fact, the reasoning of Berman would seem to be opposite.

[00:26:59] Speaker 02:
It's been pointed out these websites come in a variety of forms in all of this.

[00:27:06] Speaker 02:
What would be the correct thing to do in your view that would still leave a certain amount of flexibility to web designers to approach this in a way that they think makes sense, which would be consistent with Berman?

[00:27:22] Speaker 02:
Or do you think there's just one right way of doing it other than the button, of course?

[00:27:26] Speaker 02:
But again, that's not something that's required.

[00:27:28] Speaker 00:
I see my time is expiring if I can just finish.

[00:27:33] Speaker 00:
Go ahead.

[00:27:36] Speaker 00:
I think ClassPass at some point says it was designed to draw attention to this or it was designed to get her assent or put her on notice.

[00:27:43] Speaker 00:
I mean, it's simply not a serious argument.

[00:27:48] Speaker 00:
If you look at their pages, they know how to make things bold.

[00:27:51] Speaker 00:
They know how to make even the auto-renewal text at the very bottom of page of ER 102, which is screen one, bigger than this assent text.

[00:28:02] Speaker 00:
They know how to do a better job.

[00:28:04] Speaker 00:
But it creates friction in the buying process.

[00:28:08] Speaker 00:
So they make a decision not to do it.

[00:28:11] Speaker 00:
So I don't think, I disagree that Berman is requiring magical words.

[00:28:17] Speaker 00:
It's just saying.

[00:28:18] Speaker 02:
No, my point isn't that Berman is requiring that.

[00:28:21] Speaker 02:
I feel Berman is the opposite.

[00:28:23] Speaker 02:
My concern is that you're asking us to prescribe magic words if we were to affirm here.

[00:28:30] Speaker 00:
I don't think so.

[00:28:31] Speaker 00:
Berman, it's just clear that the legal significance of the button click that signals assent in the mind of the website operator needs to be made explicit.

[00:28:42] Speaker 00:
That doesn't mean magic words, and if you leave an S off of the end of the word or misspell a word or say, you know, by submitting your order and then the button says purchase, those are the same thing.

[00:28:56] Speaker 00:
A reasonable internet user would know that.

[00:28:58] Speaker 00:
But that's not what happened here.

[00:29:00] Speaker 00:
On page three, there's no explanation of the significance of clicking the button beyond the obvious of redeeming the $40 deal.

[00:29:08] Speaker 03:
And I know you're over your time, but just a quick question.

[00:29:12] Speaker 03:
And you certainly, you mentioned this earlier, you wouldn't advocate for having multiple pages, eight pages, 10 pages, or whatever, because that would confuse the user.

[00:29:22] Speaker 03:
So it would make sense to have it in one page, max two or something, where it's clear that the person is, by pressing the button, they are then agreeing to those terms and conditions.

[00:29:36] Speaker 00:
Sure.

[00:29:37] Speaker 00:
I agree.

[00:29:38] Speaker 00:
And ClassPass could have done it up front very clearly under this court's precedent with something like a sign up for a ClassPass account page that would have made it clear that that's what the user wants to have a long-lasting relationship with this through an account.

[00:29:56] Speaker 00:
And if you want to do that, you have to agree to our terms.

[00:29:59] Speaker 00:
Here they are.

[00:30:00] Speaker 00:
Again, that's not what they did.

[00:30:03] Speaker 00:
I've been over it, but I disagree that the first two pages are clear about signing up.

[00:30:06] Speaker 03:
Any other questions?

[00:30:08] Speaker 03:
No.

[00:30:08] Speaker 03:
Any other questions?

[00:30:09] Speaker 03:
No.

[00:30:09] Speaker 03:
Very well, thank you, Council.

[00:30:10] Speaker 00:
Thank you.

[00:30:17] Speaker 04:
Could have done it better is not the standard.

[00:30:19] Speaker 04:
The standard is reasonably conspicuous.

[00:30:22] Speaker 04:
And Chabola's theme that the onus is on ClassPass to create the website is fine.

[00:30:28] Speaker 04:
We acknowledge that.

[00:30:30] Speaker 04:
But ClassPass met that.

[00:30:33] Speaker 03:
But you could have done it better.

[00:30:34] Speaker 04:
But that's true in every case.

[00:30:36] Speaker 04:
That's not the test.

[00:30:39] Speaker 04:
And it couldn't be the test.

[00:30:41] Speaker 04:
And it certainly shouldn't.

[00:30:42] Speaker 04:
be the test.

[00:30:43] Speaker 01:
Unless we're willing to go to the simple solution that you have to have a button that says, I'm pressing this button because I agree to the terms of use.

[00:30:52] Speaker 01:
And that would be the defensive position that a company like ClassPass would have to take if we keep lopping things off and disapproving things.

[00:31:01] Speaker 01:
I mean, there's no place else for them to go.

[00:31:04] Speaker 01:
And it may be the most upfront, honest thing for

[00:31:10] Speaker 01:
your clients to do, but that's not what we've required.

[00:31:14] Speaker 04:
That's true.

[00:31:15] Speaker 04:
The law has not required that.

[00:31:16] Speaker 04:
And frankly, going that way, I don't want to say it would break the internet, but it certainly would change e-commerce tremendously and would flood this court with suddenly lots and lots of suits from everybody who said, well, all of these pages weren't quite good enough because they didn't meet the standard that the court had set.

[00:31:34] Speaker 04:
My point, and to echo your concern, or your observations, Judge Bybee, is that these pages that ClassPass had and Chibola used are about as clean and clear as you can get.

[00:31:44] Speaker 04:
They are actually much better than many of the cases that are in the precedent that have been approved.

[00:31:52] Speaker 03:
Well, they're different than overseen.

[00:31:55] Speaker 04:
Okay, so they're maybe different than Overstein.

[00:31:58] Speaker 03:
What's the closest case that you have to this case?

[00:32:03] Speaker 03:
Honestly, I just want to know because I've been looking.

[00:32:07] Speaker 04:
Patrick is a good place to go.

[00:32:08] Speaker 04:
That's this court's published opinion.

[00:32:11] Speaker 04:
And the Patrick page, I think, is sort of messier, a lot messier than this one.

[00:32:17] Speaker 04:
But, you know, every company has a different webpage.

[00:32:21] Speaker 04:
There's no one style, nor necessarily should there be, as long as the consumers are not being misled.

[00:32:28] Speaker 04:
And this notion that we heard about, you know, there should just be one sign-up page,

[00:32:34] Speaker 04:
That's not how it works.

[00:32:35] Speaker 04:
That's never a standard.

[00:32:36] Speaker 04:
The sign-up is a process, and there's nothing wrong with using multiple pages.

[00:32:40] Speaker 04:
In fact, that emphasizes to the user, you know, every time you keep going, you are agreeing yet again where this is headed.

[00:32:48] Speaker 03:
So if we don't have a case squarely on point with what's happened here, and we have to make a decision, and we have to draw a line,

[00:32:58] Speaker 03:
Where should we draw the line in this case?

[00:33:02] Speaker 03:
Is this the case?

[00:33:03] Speaker 04:
I'm not sure there's a line that needs to be drawn.

[00:33:06] Speaker 04:
As I pointed out, this court has already published a number of memorandum dispositions that basically say, oh, we looked at the page, de novo review.

[00:33:15] Speaker 04:
It's clear.

[00:33:16] Speaker 04:
The text is next to the button.

[00:33:18] Speaker 04:
That's good enough.

[00:33:19] Speaker 04:
I mean, it's not necessary that every panel and every court look at every web page and say, well, it could be this, or it could be that, or you could change it.

[00:33:27] Speaker 03:
Believe me, counsel, I've looked at so many web pages right now, I can't tell you.

[00:33:32] Speaker 03:
That's why I'm trying to find one that's similar to this in any case that we've had, and I don't think I've found something.

[00:33:38] Speaker 04:
Well, I think that the ones that we've got in the brief are close.

[00:33:42] Speaker 04:
And that may be all that we need, certainly.

[00:33:46] Speaker 04:
I mean, there's not going to be one that's exactly like that.

[00:33:49] Speaker 04:
I would say this appeal provides you with the ingredients for a perfect and easy reversal.

[00:33:56] Speaker 04:
You've got a de novo standard of review.

[00:33:59] Speaker 04:
You've got very favorable facts for class pass in terms of what Chibola did.

[00:34:04] Speaker 04:
And the case law.

[00:34:07] Speaker 04:
is very strong to enforce.

[00:34:10] Speaker 04:
It may not be exactly on all fours.

[00:34:12] Speaker 04:
We haven't found another company's webpage that looks exactly like ours.

[00:34:17] Speaker 04:
But as Judge Fitzgerald pointed out, it would be, and I may be paraphrasing and putting my own view into it, it would be wildly inconsistent to rule the other way in this case based on all of the existing precedent that's already out there.

[00:34:31] Speaker 02:
If this is the flip side of the concern that I vote a voice of the Apple II if we were to affirm here, then what would keep parties from saying, oh, we have terms of use and it's in the blue hyperlink.

[00:34:49] Speaker 02:
So, therefore, and the page isn't super duper cluttered.

[00:34:52] Speaker 02:
I don't think that's what Berman says.

[00:34:54] Speaker 02:
So, what in your view would be, with your reasoning or reversal here, keep someone from making that argument in the future, which in my view is inconsistent?

[00:35:09] Speaker 04:
The test is whether the reasonably prudent internet user would see and notice the text.

[00:35:16] Speaker 04:
That's the test.

[00:35:18] Speaker 04:
And courts look at the size and the color, and there's all kinds of different design elements that go into it.

[00:35:23] Speaker 04:
But the design elements here are perfectly consistent with all of the design elements in other cases.

[00:35:29] Speaker 04:
And so we're not asking this court to come up with a new rule.

[00:35:33] Speaker 04:
You don't have to.

[00:35:34] Speaker 04:
You can simply say, this is good enough.

[00:35:37] Speaker 04:
just like all of the other cases.

[00:35:40] Speaker 03:
Any other questions?

[00:35:41] Speaker 03:
Any other questions?

[00:35:43] Speaker 03:
Thank you, counsel.

[00:35:43] Speaker 03:
Thank you, your honors.

[00:35:44] Speaker 03:
All right.

[00:35:46] Speaker 03:
The matter of Chibola versus Classpass will be submitted.

[00:35:51] Speaker 03:
We appreciate counsel's argument today.

[00:35:54] Speaker 03:
Thank you very much.