Social media sites are transforming not only the daily lives of consumers, but also how companies interact with consumers. Here at Morrison Foerster, across all of our practice groups, we are seeing complex, cutting-edge legal issues arising out of social media. As with the Internet boom during the mid-to-late 1990s, social media is generating new legal questions at a far faster pace than the law’s ability to provide answers to such questions. In an effort to stay on top of these emerging issues, and to keep our clients and friends informed of new developments, Morrison Foerster publishes this blog devoted to the law and business of social media.<h2>ABOUT MORRISON FOERSTER</h2>Morrison Foerster is a leading global law firm that transforms complexity into advantage for its clients. Our clients include some of the largest financial institutions, banks, consulting and accounting firms, and Fortune 100, technology, and life sciences companies. Highlighting the firm’s commitment to client service, leadership in market-changing deals and impact litigation, and values-based culture, Morrison Foerster has been repeatedly recognized as one of the top 10 firms on The American Lawyer’s A-List. Year after year, the firm receives significant recognition from Chambers and The Legal 500 across their various guides, including Global, USA, Asia‑Pacific, Europe, UK, Latin America, and FinTech Legal. Our lawyers passionately care about delivering legal excellence while living our values. Morrison Foerster has a long-standing commitment to creating a culture that respects and celebrates differences, while providing an inclusive environment. The firm has achieved Mansfield Certification Plus since 2018 as a result of successfully reaching at least 30 percent women, communities of color, and LGBTQ+ lawyer representation in a notable number of current leadership roles and committees. The firm also has a long history of commitment to the community and society through providing pro bono legal services, including litigating for civil rights and civil liberties, improving public education and fostering the wellbeing of children, advocating for veterans, promoting international human rights, enforcing the right to asylum, and safeguarding the environment.

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Aaron is the chair of the firm’s Technology Transactions Group and co-chair of the Interactive + Digital Media Group. He advises clients on a wide range of complex transactions involving intellectual property and technology, including structuring and negotiating strategic licensing, development, collaboration, procurement, and distribution deals.Aaron’s practice focuses on advising both established and emerging companies in a variety of data- and technology-intensive sectors, including software, SaaS, cloud-based technology, digital media (social media, AR/VR, gaming, streaming media, AdTech), AI, healthcare, consumer electronics, e-commerce, other online business models, and mobile applications. He also maintains an active practice counseling companies on branding and marketing, trademark licensing, and content-related transactions, as well as the intellectual property aspects of mergers, acquisitions, asset spin-offs, and private equity investments.He has represented clients such as Autodesk, Meta, OpenAI, Splunk, Konami, Kaiser Permanente, SoftBank, Visa, and Yahoo, among others.Aaron has been recognized by numerous publications for his work on market-defining technology transactions. He is currently ranked by Chambers USA for “Technology Transactions.”Aaron also serves as co-editor of Socially Aware, the firm’s award-winning newsletter and blog devoted to the law and business of social media, and regularly publishes on various IP and technology-related topics. Aaron is also a sought-after speaker on new and emerging areas of law, and is a frequent presenter and panelist at conferences and legal services programs. In addition to his active practice, Aaron regularly provides pro bono assistance to various nonprofit and charitable organizations such as Common Sense Media and the Starlight Children’s Foundation. He is a member of the board of directors of California Lawyers for the Arts.While in law school at the University of California, Berkeley, Boalt Hall School of Law, Aaron served as executive editor of the California Law Review and was elected to the Order of the Coif. Following law school, Aaron served as law clerk to the Honorable William H. Orrick and the Honorable Martin J. Jenkins, both United States District Judges for the Northern District of California.

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Aaron is the chair of our Technology Transactions Group. He advises clients on a wide range of complex transactions involving intellectual property and technology, including structuring and negotiating strategic licensing, development, collaboration, procurement, and distribution deals. Aaron’s practice focuses on advising both established and emerging companies in a variety of data– and technology–intensive sectors, including software, SaaS, cloud computing, AR/VR, AI, gaming, healthcare, consumer electronics, social media, e–commerce, other online business models, and mobile applications. He also maintains an active practice counseling companies on the intellectual property aspects of mergers, acquisitions, asset spin–offs, and private equity investments.

Aaron P. Rubin

Lawrence Gallick is of counsel in the firm’s Austin office and a member of the Technology Transactions Group.Lawrence focuses his practice on technology transactions and licensing matters. His diverse experience includes advising on SaaS agreements, cross-licensing agreements, research and collaboration agreements, development agreements, and distribution agreements. He counsels a broad range of companies across the software, hardware, life sciences, biotech and FinTech spaces, as well as other entities including universities.He advises clients in connection with general corporate matters including contract negotiations, and leasing and technology placement agreements.In 2023, Lawrence seconded at Amazon Lab126, where he led the negotiation of high-profile licensing deals for a variety of Amazon device teams. The secondment was an immersive opportunity to gain additional insights and experience from the perspective of in-house counsel. Lawrence also serves as co-editor of <a href="https://www.sociallyawareblog.com/" target="_blank">Socially Aware</a>, the firm’s award-winning newsletter and blog devoted to the law and business of social media, and regularly publishes on various IP and technology-related topics.Prior to joining the firm, Lawrence was counsel at another major law firm. Before earning his law degree, Lawrence was a web consultant, project manager, and web developer in Portland, Oregon, where he managed and consulted on projects using industry methodologies and performed custom development and integration of content management systems.Lawrence was named a Super Lawyers “Rising Star” in 2015 and 2018–2022, and is licensed in both California and New York. Lawrence earned his J.D. from the University at Buffalo School of Law, where he was the electronic systems editor for the Buffalo Law Review and awarded the ABA-BNA Award for Excellence in the Study of Intellectual Property Law.

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Anthony Ramirez is a partner in the Technology Transactions Group in the New York office of Morrison Foerster.Anthony advises clients on general commercial and transactional matters. He regularly advises companies on the IP aspects of their M&A transactions. His clients include technology, digital media and content for television and music, financial services, and communications companies with diverse intellectual property assets and issues.His practice focuses on the legal aspects of developing, licensing, and commercializing technology and intellectual property, as well as negotiating general commercial contracts, including outsourcing transactions, as well as content and data licenses. He regularly assists clients with legal issues relating to licensing and commercialization of digital media and content, digital content that is distributed over the Internet or streamed, mobile applications and social media, as well as the licensing of recorded music for distribution via digital platforms. Anthony is also experienced with issues relating to open-source software, software development, artificial intelligence and machine learning, cloud-based technology, and protection of proprietary information.Anthony has extensive experience working on matters involving disruptive technologies, such as blockchain. He has helped fintech clients with general intellectual property issues in connection with terms of service for online financial products and services.Anthony is an integral part of the outside pro bono legal team for nonprofit organizations based in New York, including advising clients on legal issues regarding entertainment, social media, privacy rights, and the negotiation of outsourcing and service agreements. Anthony received his J.D. from the University of Michigan Law School in 2009. He received his B.S. from Cornell University in 2004.

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Anthony Ramirez is a partner in the Technology Transactions Group in the New York office of Morrison Foerster. He advises clients on general commercial and transactional matters. His clients include technology, media, and communications companies with considerable intellectual property assets. His practice focuses on the legal aspects of licensing and commercializing technology and intellectual property, as well as negotiating general commercial contracts. He also regularly assists clients with legal issues relating to mobile applications and social media.

Anthony M. Ramirez

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Lawrence W. Gallick

SCOTUS Age-Gates the Internet: Free Speech Coalition v. Paxton and the Future of Adult Content Regulation

Social Links: Clickbait, Court Dates, and the Beige Apocalypse

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In <a href="https://storage.courtlistener.com/recap/gov.uscourts.cand.431021/gov.uscourts.cand.431021.41.0.pdf" target="_blank">Ryan v. X Corp.</a>, a Northern District of California court held that <a href="https://www.law.cornell.edu/uscode/text/47/230" target="_blank">Section 230 of the Communications Decency Act</a> immunized X (formerly Twitter) against claims arising from suspension of a user’s account, notwithstanding that X allegedly used an AI system to select the account for suspension. The case also illustrates the unsettled state of the law (at least in the Ninth Circuit) regarding whether contract-based claims based on a platform’s alleged failure to comply with its own terms of service regarding content moderation are excluded from the Section 230 safe harbor.Plaintiff Jeremy Ryan, a “successful NFT artist” who used X to “further develop his cryptocurrency and NFT community,” sued X for suspending his accounts without explanation. Ryan alleged that X used an AI system to select his account for suspension. Ryan’s claims included breach of contract, promissory estoppel, unjust enrichment, intentional interference with contractual relationships with third parties, interference with prospective economic advantage, promissory fraud, conversion, and unfair business practices.The opinion in this case came in two parts. The court first <a href="https://storage.courtlistener.com/recap/gov.uscourts.cand.431021/gov.uscourts.cand.431021.29.0.pdf" target="_blank">dismissed several of Ryan’s claims</a> in September 2024, holding that the breach of contract, intentional interference, conversion, and unfair business practices claims were barred by Section 230. The court then dismissed the remaining claims in a subsequent opinion in December 2024 as barred by X’s terms of service.In its September opinion, the court applied the three factors from <a href="https://law.justia.com/cases/federal/appellate-courts/ca9/05-36189/05-36189-2011-02-25.html" target="_blank">Barnes v. Yahoo!</a> to determine whether the statute immunized X from liability: (1) whether X is a provider or user of an “interactive computer service,” (2) whether Ryan’s claim seeks to treat the defendant as a “publisher or speaker,” and (3) whether the content at issue was provided by “another information content provider.” The court quickly determined that the first and third factors were satisfied: X is an interactive computer service, and Ryan provided the content at issue. The key question was whether X’s suspension of Ryan’s accounts constituted a “publishing decision.”The court ruled that X’s account suspension decisions were indeed “traditional publishing functions” protected under Section 230. Relying on Ninth Circuit precedent, the court held that “any activity that can be boiled down to deciding whether to exclude material that third parties seek to post online is perforce immune under section 230.” The fact that X may have used AI to assist in its moderation decisions did not change this outcome.Other than the AI angle, this would appear to be a fairly standard application of Section 230, but the court also had to address Ryan’s breach of contract claim based on X’s alleged failure to comply with its own terms of service and other statements made on X’s website. The court’s job was made more difficult by recent Ninth Circuit cases <a href="https://cdn.ca9.uscourts.gov/datastore/opinions/2024/06/04/22-15910.pdf" target="_blank">Calise v. Meta Platforms, Inc.</a> and <a href="https://cdn.ca9.uscourts.gov/datastore/opinions/2024/08/22/23-55134.pdf" target="_blank">Estate of Carson Bride v. YOLO Technologies, Inc.</a>, both of which found exceptions to Section 230 based on the defendant platforms’ alleged failure to comply with their own content moderation policies.Commentators have criticized <a href="https://blog.ericgoldman.org/archives/2024/06/ninth-circuit-does-more-damage-to-section-230-calise-v-meta.htm" target="_blank">Calise</a> and <a href="https://blog.ericgoldman.org/archives/2024/08/when-it-comes-to-section-230-the-ninth-circuit-is-a-chaos-agent-estate-of-bride-v-yolo.htm" target="_blank">YOLO</a> for significantly expanding the limited Section 230 exception for promissory estoppel claims in <a href="https://law.justia.com/cases/federal/appellate-courts/ca9/05-36189/05-36189-2011-02-25.html">Barnes v. Yahoo!</a> in a manner that is inconsistent with dozens of prior cases and with the words of the statute itself. Barnes created a limited exception to Section 230 for contract-based claims where the defendant platform operator made a specific promise to the plaintiff to remove content and then failed to do so. Calise and YOLO expanded the exception to include “promises” contained in generally applicable platform terms and policies.The Ryan court held that these cases did not preclude application of Section 230 and reached back to Barnes to support its conclusion that Ryan’s contract claim was barred, holding that “despite Ryan’s protestations to the contrary, his suspension was undertaken by X in its capacity as a publisher of information, it meets the other Barnes criteria, and is protected.” In discussing Calise, the court noted that Ryan was trying to “impose liability upon X arising from its actions as a publisher, not its failure to fulfill some promise separate from that role,” and that the argument that his contract claim arose from a separate promise that X made to users on its website “comes up short because . . . statements made in a social media site’s terms and community standards do not amount to a legally enforceable promise.” We leave it to the reader to decide whether Ryan actually distinguishes Calise or simply refuses to apply it.The court went on to dispose of Ryan’s claims for intentional interference with plaintiff’s contractual relationships, conversion, and unfair business practices, also on Section 230 grounds. In each instance, Ryan’s claim arose from X’s decision to suspend Ryan’s accounts, which the court held was a publishing decision and therefore immunized under Section 230. In discussing Ryan’s conversion claim, which was based on the allegation that an “automated bot” made certain misrepresentations to Ryan regarding restoration of his account, the court noted that suspending an account is a publishing decision, regardless of whether AI is used.Ryan did not fare any better in the December opinion, where the court dismissed his remaining claims as barred by X’s terms of service. X’s terms of service stated that X may stop providing services to users, limit use of services, remove user content, and suspend or terminate users without liability. Ryan argued that California courts do not enforce limitation of liability provisions under <a href="https://leginfo.legislature.ca.gov/faces/codes_displaySection.xhtml?sectionNum=1668.&lawCode=CIV#:~:text=All%20contracts%20which%20have%20for,(Enacted%201872.)" target="_blank">California Civil Code Section 1668</a> if they protect against fraud or gross negligence. Only Ryan’s claim for promissory fraud alleged fraud or gross negligence, however, and that claim requires a promise. Because X did not make any promise not to suspend Ryan’s accounts even if he complied with the terms of service, California Civil Code Section 1668 did not prohibit enforcement of the limitation of liability in X’s terms of service. Accordingly, the court dismissed Ryan’s claims for promissory fraud, promissory estoppel, unjust enrichment, and unfair business practices claim.The court also noted that, even if not barred by X’s terms of service, Ryan’s unjust enrichment claim would be barred under Section 230. Ryan argued that X was not entitled to Section 230 immunity because the decision to suspend his account was made by X’s AI system, and that this somehow made X an information content provider rather than merely an interactive computer service provider. Ryan also argued that X’s AI system (as distinct from X) was not entitled to Section 230 immunity. Ryan’s arguments are difficult to understand based on the opinion, and it appears that the court struggled with them as well. In any event, the court was not convinced, stating “no authority suggests that X’s use of a generative AI model to do content regulation deprives it of Section 230 immunity” and “[n]othing in the plain language of the statute suggests that X would be denied section 230 protection because it uses an AI system for content moderation.”

Aaron is the chair of the firm’s Technology Transactions Group and co-chair of the Interactive + Digital Media Group. He advises clients on a wide range of complex transactions involving intellectual property and technology, including structuring and negotiating strategic licensing, development, collaboration, procurement, and distribution deals.

Aaron Rubin

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Lindsay is an associate in the Technology Transactions Group of Morrison Foerster.

Lindsay B. Harris

Lindsay Harris

Northern District Applies Section 230 to AI-Assisted Content Moderation

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On May 9, 2024, in <a href="https://casetext.com/case/x-corp-v-bright-data-ltd-1" target="_blank">X Corp. v. Bright Data Ltd</a>., the U.S. District Court for the Northern District of California dismissed X’s claims alleging that Bright Data’s access to X’s systems, and scraping and selling of publicly available data from X’s platform, violated its Terms of Service and other policies. Bright Data’s business involves various data scraping products and services, such as scraping data on behalf of its customers, selling tools that enable customer to scrape data, and providing IP proxies for customers to use when scraping data.As an initial matter, the court divided its analysis in two, first looking at X’s claims based on Bright Data’s improper access to X’s systems and then at X’s claims based on Bright Data’s scraping and selling of X’s data. The court easily dismissed the claims based on improper access to X’s systems, including claims for trespass to chattels, violation of California Section 17200 (prohibiting unlawful, unfair and fraudulent business acts), tortious interference with contract, and breach of contract. There was nothing particularly surprising in the court’s analysis of these claims, since the dismissals primarily resulted from X’s failure to plead adequate damages arising from Bright Data’s allegedly improper access.The more interesting aspect of Bright Data came next, where the court considered X’s claim that Bright Data’s scraping and selling of data violated X’s Terms of Service and held that X’s claims were preempted by federal copyright law.Section 301(a) of the Copyright Act states that federal copyright law preempts state-law claims when a plaintiff’s work “come[s] within the subject matter of copyright” and state law grants “legal or equitable rights that are equivalent to any of the exclusive rights within the general scope of copyright.” The court in Bright Data noted that there are two types of copyright preemption: (i) express preemption with respect to state law rights that are “equivalent” to federal copyright rights, and (ii) conflict preemption, where enforcement of the state law would more generally undermine the purpose of federal copyright law. The court in Bright Data focused on this second type of preemption.Under X’s Terms of Service, users retain ownership of the images, text, and other content that they upload to the X platform, and grant X a broad, non-exclusive, royalty-free license to display users’ content on the X platform and to use that content in various other ways, including by disseminating the user content through X’s paid tools. The Terms of Service also prohibit scraping and selling any content from the X platform.As a first step in its preemption analysis, the court notes that, under the Terms of Service, X does not own the user content that Bright Data scraped and sold, and X merely has a non-exclusive license to use the content. Under federal copyright law, a non-exclusive licensee is permitted to use the licensed works within the scope of the license, but has no right to enforce the copyright in, or exclude others from using, the works. Despite this, the claims that X asserted in Bright Data sought to enforce contractual terms that would give X the ability to exclude others from using the content in a manner that would otherwise be available only to the owner (or, possibly, the exclusive licensee) of the copyright in the content, not to a mere non-exclusive licensee.(As an aside, the court speculates that the reason that X does not require users to assign ownership of their content to X, or grant X an exclusive license to use content, under its Terms of Service is because this would impact X’s ability to claim the benefit of the safe harbors under Section 512(a) of the Digital Millenium Copyright Act and Section 230 of the Communications Decency Act, two federal statutes that protect website operators from liability arising from content posted by users. The court notes: “X Corp. wants it both ways: to keep its safe harbors yet exercise a copyright owner’s right to exclude, wresting fees from those who wish to extract and copy X users’ content.” In fact, it is not necessarily true that the availability of these statutory safe harbors turns on whether the website operator holds title (or an exclusive license) to the user content at issue. The more likely reason that X does not claim ownership of user content is that doing so would be viewed as overreach and result in significant backlash among its users. But as this issue is not central to the copyright preemption analysis, we leave it for another day.)The court then goes on to hold that X’s claim that Bright Data breached the Terms of Service by scraping and selling user content is preempted by federal copyright law in three ways, namely that enforcement of X’s contractual rights would:<ol class="li-text-orange"><ol class="li-text-orange"><ol class="li-text-orange"><li>Interfere with copyright owners’ exclusive rights and frustrate federal copyright law, since allowing X to enforce its Terms of Service would give it, a non-exclusive licensee, the ability to exclude others from exercising those rights;</li><li class="li-text-orange">Frustrate the operation of fair use, which would (absent a contract preventing it) allow use of the user content for certain permitted purposes (note that, as <a href="https://blog.ericgoldman.org/archives/2024/05/x-corp-v-bright-data-is-the-decision-weve-been-waiting-for-guest-blog-post.htm">observed</a> by guest blogger Guy Rub in Eric Goldman’s blog, the court seems to treat fair use as something akin to an affirmative right, rather than as the affirmative defense to an infringement claim that it actually is); and</li><li>Restrict use of type of information that Congress intended to keep free from restraint, namely uncopyrightable items such as likes, user names, short comments, etc. (It is not entirely clear how this can form a basis for preemption given that these items fall outside the scope of copyright law … but we digress.)</li></ol></ol></ol>Overall, the court presents an interesting new addition to web scraping law, one not addressed in a case that the court still found six occasions to cite, <a href="https://law.justia.com/cases/federal/appellate-courts/ca9/17-16783/17-16783-2019-09-09.html" target="_blank">hiQ Labs, Inc. v. LinkedIn Corp</a>. (see one of our <a href="https://www.sociallyawareblog.com/topics/ninth-circuits-linkedin-decision-does-not-greenlight-the-unauthorized-web-scraping-of-public-websites" target="_blank">previous articles</a> on that case). In light of Bright Data, website operators should be aware that contractual prohibitions contained in terms of service may not be effective to prevent scraping of user content that they make publicly available.

California Federal Court Holds X’s Claims Against Scraper Preempted by Federal Law

Lawrence Gallick is of counsel in the firm’s Austin office and a member of the Technology Transactions Group.

California Federal Court Holds X’s Claims Against Scraper Preempted by Federal Law

On May 9, 2024, in X Corp. v. Bright Data Ltd., the U.S. District Court for the Northern District of California dismissed X’s claims alleging that Bright Data’s access to X’s systems, and scraping and selling of publicly available data from X’s platform, violated its Terms of Service and other policies.

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In this age of social media and texting, we use a plethora of shorthand visual and typographic icons to express a range of responses or reactions to posts or texts: a heart to indicate love, a laughing face or an “LOL” to indicate humor, a “: )” to indicate general pleasure.But be careful the next time you use the thumbs-up emoji, especially in a business context. It could be interpreted as the equivalent of a signature and indicate to the recipient that you agree to a contractual exchange.In July 2023, a Canadian court in Saskatchewan ruled as such, in South West Terminal Ltd. v Achter Land, 2023 SKKB 116 (CanLII). The case involved a text exchange between a farmer, Chris Achter, who was to sell 87 metric tons of flax to a buyer, Kent Mickleborough.Mickleborough signed the contract and texted a photo of it to Achter with the accompanying text “Please confirm flax contract.” Achter responded with a thumbs-up emoji, which to Mickleborough indicated that Achter was agreeing to the contract.Justice T.J. Keene of the Court of King’s Bench for Saskatchewan ruled that Achter breached what Keene deemed as a valid contract when Achter failed to deliver the flax to Mickleborough.Keene wrote in his ruling that “This court readily acknowledges that a 👍 emoji is a nontraditional means to ‘sign’ a document but nevertheless under these circumstances this was a valid way to convey the two purposes of a ‘signature’ — to identify the signator [and] to convey Achter’s acceptance of the flax contract.” Justice Keene ordered Mr. Achter to pay damages of CA$82,200 (approximately US$61,000).As The New York Times reported, “In coming to his decision, Justice Keene cited the dictionary.com definition of the thumbs-up emoji: ‘used to express assent, approval or encouragement in digital communications, especially in Western cultures.’”In the United States, there have been a few cases to date that interpret the thumbs-up emoji, as Eric Goldman writes in his Technology & Marketing Law Blog about this Canadian case. One is Lightstone v. Zinnex, involving the sale of personal protective equipment during the pandemic, and Bardales v. Lamothe, involving the estranged parents of a child and decisions about where the child should live. (On his blog, Goldman lists 37 U.S. court opinions that reference the thumbs-up emoji.)Here at Socially Aware we’ll be keeping a close eye on the legal developments surrounding the implications of icons, emojis, and other design and display-related expressions that may have legal consequences.

Anthony Ramirez is a partner in the Technology Transactions Group in the New York office of Morrison Foerster. Anthony advises clients on general commercial and transactional matters. He regularly advises companies on the IP aspects of their M&A transactions.











Anthony Ramirez

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Clients seek out Julie because of her practical advice on cutting-edge issues at the intersection of privacy and consumer protection laws. She provides clients with practical solutions to compliance c

Julie O'Neill

Clients seek out Julie because of her practical advice on cutting-edge issues at the intersection of privacy and consumer protection laws. She provides clients with practical solutions to compliance challenges around a wide variety of both online and offline privacy issues, including tracking, interest-based advertising, geo-targeting and other mobile tracking, personalization, and cross-device tracking. Recognized in The Legal 500 US 2014, 2016, 2019, and 2020 and Chambers USA 2021 for her exceptional legal work, her clients praise her saying, “She is really good at giving practical, targeted advice and taking stock of what the risk profile of the client is, so that the advice is holistic.” (Chambers USA 2021).

In this age of social media and texting, we use a plethora of shorthand visual and typographic icons to express a range of responses or reactions to posts or texts: a heart to indicate love, a laughing face or an “LOL” to indicate humor, a “: )” to indicate general pleasure.

Be Careful What You Click for: A Canadian Court Rules that a Thumbs-Up Emoji Indicates a Binding Contractual Agreement

Digital Content

As part of the new <a href="http://www.bgbl.de/xaver/bgbl/start.xav?startbk=Bundesanzeiger_BGBl&jumpTo=bgbl121s3433.pdf" target="_blank" rel="noopener noreferrer">Fair Consumer Contracts Act</a>, [Gesetz für Faire Verbraucherverträge; published in the Federal Gazette (Part I) no. 53/2021, p. 3433 et seq., full text publicly available (<a href="http://www.bgbl.de/xaver/bgbl/start.xav?startbk=Bundesanzeiger_BGBl&jumpTo=bgbl121s3433.pdf" target="_blank" rel="noopener noreferrer">in German</a>) Germany will soon require specific cancellation/termination mechanisms for consumer subscriptions. These mechanisms come on top of the updated EU-wide consumer contract rules under the EU Directives on Contracts for Digital Services and Content and on Contracts for the Consumer Sale of Goods and will take effect on July 1, 2022. Significant implementation effort is expected for affected providers.Businesses offering subscriptions to German consumers will have to provide a specifically labeled button for their online retail channels that leads to a contact form through which consumers must be enabled to cancel existing subscriptions with the click of only one further button. If sufficient data to identify the subscription to be cancelled is entered by the consumer, the submission of the form will itself be a valid cancellation, the effect of which cannot be made subject to further steps such as logins or second factor (e.g., email, app) confirmations.Failing to implement this “cancellation button” or “termination button” correctly will invalidate any minimum subscription terms or termination notice periods in contracts for which such button should have been provided and will be a breach of consumer protection that opens providers to cease and desist claims.<a href="https://www.mofo.com/resources/insights/211006-new-two-click-cancellation-button.html">Read the full client alert</a>.

DocuSign, Inc

enercity AG

SoftBank Vision Fund

TDK and its subsidiary EPCOS

Tele Columbus

United Internet/1&1

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Kristina has more than 20 years of experience advising clients across many industries, including the software, internet, mobility, media, and consumer electronics industries, with a particular focus o

Kristina Ehle

Kristina Ehle has more than 20 years of experience advising clients across many industries, including the software, internet, mobility, media, and consumer electronics industries, with a particular focus on technology-driven and IP-heavy transactions.

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Counsel

Stephan is counsel at Morrison Foerster’s German office in Berlin. He focuses on advising major German and international clients with regard to drafting and negotiating complex technology-related agreements and on matters concerning cloud computing, software, e/m-commerce, digital media, intellectual property rights, consumer rights, electronic communication, big data and cyber security requirements.

Stephan Kreß

Stephan is counsel at Morrison Foerster’s German office in Berlin. As a member of the technology transactions group, he focuses on advising major German and international clients with regard to drafting and negotiating complex technology-related agreements and on matters concerning cloud computing, software, e/m-commerce, digital media, intellectual property rights, consumer rights, electronic communication, big data and cyber security requirements.

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New “Two-Click Cancellation” Button – German Exceptionalism for Subscription Terminations

Click Yes to Accept: Fairness and Transparency in Consumer Contracts in Europe

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As part of the new Fair Consumer Contracts Act, [Gesetz für Faire Verbraucherverträge; published in the Federal Gazette (Part I) no. 53/2021, p. 3433 et seq., f

New “Two-Click Cancellation” Button – German Exceptionalism for Subscription Terminations

European Union

Compliance

With a judgment dated April 27 and published on June 4, 2021, the German Federal Court (Bundesgerichtshof – the “Court”) declared unfair and therefore illegal and unenforceable a common way to make changes to terms and conditions (“T&Cs”) used vis-à-vis consumers in Germany.For more information, read the <a href="https://www.mofo.com/resources/insights/210614-some-things-never-change.html">full client alert</a>.

Some Things Never Change… Including, Apparently, T&Cs in Germany