Chapter 10


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Chapter 10

  1. 1. CHAPTER 10 E-Contracts
  2. 2. <ul><li>What are some important clauses to include when making offers to form electronic contracts, or e-contracts? </li></ul><ul><li>How do shrink wrap and click-on agreements differ from other contracts? How have traditional laws been applied to these agreements? </li></ul><ul><li>What is an electronic signature? Are electronic signatures valid? </li></ul><ul><li>What is a partnering agreement? What purpose does it serve? </li></ul><ul><li>What is the UETA? What are some of the major provisions of this act? </li></ul>Learning Objectives
  3. 3. Forming Contracts Online <ul><li>Online Offers should include: </li></ul><ul><ul><li>Remedies for Buyer. </li></ul></ul><ul><ul><li>Statute of Limitations. </li></ul></ul><ul><ul><li>What constitutes Buyer’s acceptance. </li></ul></ul><ul><ul><li>Method of Payment. </li></ul></ul><ul><ul><li>Seller’s Refund and Return Policies. </li></ul></ul><ul><ul><li>Disclaimers of Liability. </li></ul></ul><ul><ul><li>How Seller will Use Buyer’s Information (Privacy). </li></ul></ul>
  4. 4. Online Contract Formation <ul><li>Dispute Settlement Provisions. </li></ul><ul><ul><li>Choice of Law. </li></ul></ul><ul><ul><li>Choice of Forum. </li></ul></ul><ul><ul><li>E-Bay uses online dispute resolution. </li></ul></ul><ul><li>Displaying the Offer (via hyperlink). </li></ul><ul><li>How Offer Will Be Accepted. </li></ul><ul><ul><li> </li></ul></ul><ul><ul><li>“I Accept” Button to Click. </li></ul></ul>
  5. 5. Online Acceptances <ul><li>Click-on Agreements. </li></ul><ul><li>Shrink-Wrap Agreements. </li></ul><ul><ul><li>Contract terms are inside the box. </li></ul></ul><ul><ul><li>Party opening box agrees to terms by keeping merchandise. </li></ul></ul><ul><li>Enforceable Contract Terms. (UCC 2-204). </li></ul><ul><li>Additional Terms. </li></ul>
  6. 6. Online Acceptances <ul><li>Click-On Agreements occur when Buyer “checks out” or clicks on “I Accept” button on Seller’s website or when software is installed. </li></ul><ul><ul><li>i.LAN Systems Inc. v. NetScout Service Level Corp. (2002). </li></ul></ul><ul><li>Browse-Wrap Terms. </li></ul><ul><ul><li>Specht v. Netscape Communications (2002). </li></ul></ul>
  7. 7. E-Signatures <ul><li>E-Signature Technologies. </li></ul><ul><ul><li>Asymmetric Cryptosystem. </li></ul></ul><ul><ul><li>Cyber Notary. </li></ul></ul><ul><li>State Law Governing E-Signatures. </li></ul><ul><ul><li>Uniform Electronic Transactions Act (1999). </li></ul></ul><ul><li>Federal Law. </li></ul><ul><ul><li>E-SIGN (2000) gives e-signatures and e-documents legal force. </li></ul></ul><ul><ul><li>In re Cafeteria Operators, L.P. (2003). </li></ul></ul>
  8. 8. Partnering Agreements <ul><li>Sellers and Buyers agree as to protocols to create online agreements. </li></ul><ul><li>Useful for electronic inventory (Just In Time) ordering of parts and supplies. </li></ul>
  9. 9. UETA <ul><li>Purpose is to remove barriers to forming electronic commerce. </li></ul><ul><li>E-Signature is “electronic sound, symbol or process…associated with a record and… adopted by a person with intent to sign the record.” </li></ul><ul><li>UETA applies only to e-records and e-signatures relating to a transaction. </li></ul>
  10. 10. UETA and E-SIGN <ul><li>E-SIGN explicitly refers to UETA. </li></ul><ul><li>Provides that E-SIGN is pre-empted by state passing of UETA. </li></ul><ul><li>But state law must conform to minimum E-SIGN procedures. </li></ul>
  11. 11. Highlights of UETA <ul><li>Parties must agree to Conduct Transactions Electronically. </li></ul><ul><ul><li>A party can “opt out” of UETA terms. </li></ul></ul><ul><li>Attribution—process to ensure person sending an electronic record is in fact the real person. </li></ul><ul><li>Electronic Errors. </li></ul><ul><li>“E-Mailbox” Rules. </li></ul><ul><ul><li>Dispatched when leaves control of sender. </li></ul></ul><ul><ul><li>Received when enters recipient’s processing system. </li></ul></ul>
  12. 12. UCITA <ul><li>Applies to computer information. </li></ul><ul><li>Software is not a “good” but intellectual property. </li></ul><ul><li>Software is licensed, not sold; </li></ul><ul><li>License contract gives Buyer (Licensee) only specific rights. </li></ul><ul><li>Attribution and Authentication. </li></ul><ul><li>Mass Market Licenses. </li></ul>