Notice and Consent: How [Not] to Notify Customers of Contract Changes

​📣In case you missed it, January 2024 was fairly eventful regarding notice and consent requirements. This area is evolving and is skewing pro-consumer.

❗So, what happened in January?

🔷Uber – The Massachusetts Supreme Judicial Court (SJC) heard oral arguments to determine whether Uber gave “reasonable notice” to its users before changing its terms. More specifically:

🔺Uber used an in-app pop-up notification that told users that its terms had been updated

🔺Users COULD click to view the terms, but they were NOT required to view them

🔺Users were also NOT required to “agree”

📌Keep in mind that the SJC required Uber to revise its T&C’s in 2021 after determining that Uber “must provide its customers reasonable notice of the company’s binding terms and obtain customers’ reasonable manifestation of assent to those terms”

🔶Popular Bank- The Second Circuit determined that bank customers did not provide contractual assent to new contract terms, and so the bank’s changes to its contract were not valid. The bank had simply mailed an “update” to its customers explaining the changes.

The Second Circuit sided with customers focusing on whether the changes were “reasonably communicated ” to customers in a “clear and conspicuous way.” It noted that the bank stated in its notice that “continues to be a Mandatory Arbitration Provision,” which was misleading, because an arbitration provision was not previously part of the agreement.

💡Key takeaways:

If you make changes to a passive agreement (one where the other party does not negotiate):

🔅Tell the other party about the changes in a way that is clear, truthful, and hard-to-miss

🔅Ensure the other party takes some action that indicates they agree to maintain the contractual relationship.

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Alina Lee

Alina Lee, Founder of Your Ad Attorney law firm


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