Pinterest “Buyable Pins” And Ecommerce Liability

Agreement SM

Last week, Pinterest announced the release of “Buyable Pins” – streamlining the online purchasing process that enables Pinterest users to buy pinned items from several stores without having to leave the Pinterest site or app.  For consumers, Buyable Pins make it easier to move from a Pin to purchase. For businesses, this opens a door to a large new audience who loves to shop.

Here’s everything you need to know about selling on Pinterest and potential areas of Ecommerce liability.

Online Contracts Reduce Merchant Risk. Sometimes.

A substantial number of court opinions in recent years have looked at the validity of various provisions contained in online contracts. The starting point for most analyses is the point of contract formation, because terms of online contracts are enforceable only if the contract was validly formed. Courts have scrutinized ecommerce contracts, primarily in four areas: (a) Terms of Sale; (b) Returns/Exchanges; (c) Governing Law & Venue; and (d) Arbitration. Quite often, courts have refused to enforce such terms, due to deficiencies in the formation of online contracts.

As a general proposition, formation of contracts (offer and acceptance) and enforceability of contractual provisions (choice of governing law) are matters determined by reference to state law. However, in the United States, federal courts are often required to determine matters of state law and most states have relatively uniform requirements with respect to the three principal concepts in the determination of contract enforceability: offer, acceptance and consideration.

With respect to contract law in relation to online commerce (ecommerce), contracts generally take one of two forms: (1) “click-through” or “click-wrap” agreements, and (2) “browse-wrap” agreements, often referred to as Terms of Use or Terms of Service. It is worth noting that a recent Eastern District of New York court decision classified online contracts in four categories (a) browsewrap[sic]; (b) clickwrap[sic]; (c) scrollwrap[sic]; and (d) sign-in-wrap. Berkson v. Gogo, LLC, Case No. 14-CV-1199 (USDC E.D.N.Y. April 9, 2015). Functionally, the last three tend to look substantially similar (e.g. there is some action required to consent to the agreement, see discussion of “consent,” below) and will be treated as such for purposes of this article.

This is particularly important for merchants using “Buyable Pins” on Pinterest. Unless the online terms of the agreement between the merchant and the customer are validly binding and enforceable, many of the protections offered to the merchant in the online contract will not be available.

As noted above, courts have frequently refused to enforce provisions around a merchant’s ability to modify some terms post-sale (Terms of Sale), the availability of and methods for returns and exchanges, how and where lawsuits may be filed (Governing Law & Venue), and requirements to submit disputes to arbitration. This presents particular issues for Buyable Pins. Merchants need to think carefully about how a user is presented with the opportunity to accept or reject an online contract, and how the user “manifests consent to the agreement.”

The so-called “click-wrap” agreement is usually the agreement formed when a user purchases goods or services through an ecommerce shopping cart application. A user is presented with the online terms and conditions and must “click-through” as part of the transaction.

Consenting to Online Terms.

“Click-wrap” agreements derive their name from the shrink-wrap agreements that were first incorporated into commercially-distributed software. Users were deemed to have accepted the terms of the agreement by opening the package and installing the software. In ProCD, Inc. v. Zeidenberg, 86 F.3d 1447, 1450 (7th Cir.1996), the court held that a user was bound by the terms and conditions of a software license agreement (contract) included in a users’ manual within the packaging, and which was displayed on a computer screen upon installation and use of the software. Such contracts are enforceable unless their terms are objectionable on grounds applicable to contracts in general (for example, if they violate a rule of positive law, or if they are unconscionable).

Consenting to Arbitration, Choice of Law and Venue.

Another concern is the scope of the terms and conditions applicable to the contracts, and whether additional terms may be incorporated by reference or presented after the transaction has been processed. Courts have been severely reluctant to enforce additional contract terms that would affect a user’s rights, such as the user’s ability to enforce the contract, including arbitration provisions, choice of law, and choice of venue provisions in online contracts, especially where such terms were communicated after-the-fact. This issue was addressed by a federal court in Schnabel v. Trilegiant. 697 F. 3d 110 (2nd Cir.2012)

Consenting to Changes in Price.

A very recent case involving Safeway grocery stores challenged a merchant’s practice of charging slightly different (and higher) prices for items ordered online than those purchased in-store. The in-store prices varied day-to-day. Typically, after a customer placed an online order, the items were actually selected from a physical store and delivered to the customer. At issue was the enforceability of Safeway’s “amend-at-will-without-notice” clause contained in the online terms.

Finding the clause unenforceable, the court reasoned “beyond the impracticality of expecting consumers to spend time inspecting a contract they have no reason to believe has been changed, the imposition of such an onerous requirement on consumers would be particularly lopsided, as Safeway is aware that it has — or has not — made changes to the Terms and is the party to the contract that wishes for the new terms to govern.” Rodman v. Safeway Inc., 2014 WL 6984703 (N.D. Cal. Dec. 10, 2014)

Best Practices For Merchants.

“Buyable Pins” highlight the legal risks inherent in ecommerce contracts. Seamlessly moving form Pin to purchase will no doubt increase sales and customers and reduce abandoned virtual shopping carts. However, merchants need to be mindful that the risk of losing a lawsuit because of an unenforceable contract is greater than the risk of losing a sale because a customer had to objectively consent to that contract.

Here are six “best practices” to ensure that the online contract formation process is bullet-proof: 1) use a multi-step account activation (or transaction confirmation) process where the user is shown the contract (can be in a separate “pop-out” window); 2) use a notice appearing in bold print stating, “Carefully read the following terms and conditions. If you agree with these terms, indicate your assent below;” 3) present the terms and conditions in a new window, with a scroll bar that allows the user to scroll down and read the entire contract (the Berkson “scrollwrap” agreement; 4) link to a printer-friendly version to read the contract printed on paper or view it on a full-screen; 5) display a box and the words, “Yes, I agree to the above terms and conditions” viewable without scrolling; and 6) have a functional requirement that the user click the box in order to proceed to the next step.

While I cannot guarantee that using these techniques will ensure that your online contracts will be fully-enforceable 100% of the time, it will make it exceptionally hard for a potential plaintiff to argue that there was no enforceable contract.

When it comes to addressing emerging ecommerce legal risks, it is often difficult to determine whether you should slow down, change course, signal for help, or simply muddle through. Often, companies need to quickly identify potential issues, assess the risk, and implement controls to steer clear of unneeded exposure. The professionals at the Adler Law Group can help you review, enhance and adopt standardized contracts and implement methodologies for approaching these challenges by setting objectives, determining scope, allocating resources, and developing agreements that will efficiently and effective manage risks, while keeping pace with the business.

Focus | Vision | Perspective | Passion

Executives face a confusing and dynamic set of challenges ensuring their business remains legally compliant. Yet few can afford the highly-qualified and versatile legal staff needed to deal with today’s complex legal & regulatory environment. Adler Law Group was created to provide clients with a competitive advantage by enabling them to leverage their intangible assets and creative content in a way that drives innovation and increases the overall value of the business.

For a FREE, no-obligation 1 hour consultation to learn the best ways to identify, protect and leverage your ideas, please call: (866) 734-2568, click:, or write: David @

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Socail Media, Search & Mobile Issues Discussed at’s Converge2012

The Future Of Social Is Moving From Mere Participation To Analysis & Strategic Initiatives

I had the opportunity to attend and participate in Converge 2012 run by the Institute for Social, Search & Mobile Marketing. The theme was mastering the Business of Social Media. The Conference had a great selection of speakers (yours truly included) and topics that really resonated with the audience. I hope to summarize here some of the take-aways I learned at this conference.

Business Is Now Social

The last few years have seen an unprecedented shift in the adoption of social platforms for businesses to reach and interact with customers. What started as a “dipping our toes into the water” excerise has now matured into jumping in with both feet. Not surprisingly, the first few presentations of the conference focused on the effect of so much participation: greater focus on ROI. The presentations covered a lot of ground, but here are the key take aways from Day 1:

  • Businesses that fail to integrate the social channels may not exist in five years
  • Analytics are maturing in terms of both measurement tools and metrics
  • Better analytics are driving innovation by putting companies ahead of emerging issues instead of simply reacting to them
  • Creating a Social Media culture must come from the top and flow down
  • The growth of mobile platforms Is blurring the line between online and in-store experiences because of anywhere/anytime andpersonalized access

Day 1 concluded with the panel presentation in which I participated “Social Media “Venture Heaven” Money is flooding into social media, It’s time to understand why.” Key take-aways from this panel include the followig Data about the growth in Mobile:

  • As of May, 2012, mobile comprises 10% of Internet traffic, up from just 4% less than a year and a half ago
  • Mobile = ~8% of ecommerce
  • Monetization growing rapidly 79% is Apps, 21% is from ads
  • There has been a rapid increase in time spent relative money spent on ads; TV is roughly at parity while Mobile ad spend is about 1/10 of that
  • Drivers of growth in Mobile:
    • Devices
    • Platforms
    • Improved user interfaces
    • Sharing
    • More emphasis on design aestheticS

In a world of ubiquitous fast Internet,  mass blogging and micro-blogging, minute-by-minute status updates and customer complaints and recommendations, businesses need to focus on tailoring their product for their customers desires, rather that merely tolerating customer requests. Whatever device/platform customers use most will get the most attention from developers, accessory makers and potential new customers.

Social Media World Legal News Roundup

The legal and regulatory environment impacting social media is constantly evolving. Here is a collection of recent articles impacting everything from law enforcement use of social media to new legislation.

A social media tip line for police
“Use of social media has provided an additional outlet for people to interact with law enforcement” says Lauri Stevens – founder of LAwS Communications, a consulting company that helps law enforcement agencies expand into social media.

Social media limits and the law
Monterey County Herald
Leland Yee, a San Francisco Democrat, introduced a bill that would prohibit employers, public or private, from requiring or requesting in writing a prospective employee to disclose user names or passwords for personal social media accounts.

Ariz. bill says unlawful to ‘annoy’ others online
“Speaking to annoy or offend is not a crime,” Media Coalition Executive Director David Horowitz said. Horowitz said if the proposal becomes law, speech done in satire, political debate or even sports trash talking could get people in unnecessary legal trouble.

Social Media in China, Innovation
Washington Post
Apr. 2, 2012 – April 2 (Bloomberg) — Vivek Wadhwa, fellow at Stanford Law School and head of academics at Singularity University, talks about social media in China and innovation.

UAE legal experts want libel to apply to social networking sites
GMA News
Claiming that Facebook, Twitter and other social networking sites can be used to spread rumors and false information, the legal community in the United Arab Emirates (UAE) is seeking that libel laws be applied to offenders on the Internet.

Is Your Facebook Password Like Your Mail, House Key, or Drug Test?
The Atlantic
A day after it was proposed, the amendment was voted down — almost entirely along party lines — thus closing one door to social media privacy legislation, at least on the national level. (There are similar social media privacy laws — full bills, …

Sponsor: Arizona bill isn’t aimed at Internet trolls
The fear is that the bill would prohibit hateful comments on news and social-media sites, amounting to a ban on so-called Internet trolling. The problem: The bill won’t do any of that, its sponsor told CNN on Wednesday. “I think they’re absolutely …

How Family Law Attorneys Use Social Media Evidence [Infographic]
PR Web (press release)
Family Law Attorneys Dishon & Block formally released today an infographic that illustrates how attorneys use social media to collect “smoking gun” evidence for divorce and child custody cases. With the advancement in technology and modernizing of laws …
See all stories on this topic »
PR Web (press release)

How Can Lawyers Use the Social Media Site Pinterest?

For those of us who try to immerse ourselves in technology and more recently, Social Media, the new “kid on the block” seems to be Pinterest. According to their site, “Pinterest lets you organize and share all the beautiful things you find on the web. People use pinboards to plan their weddings, decorate their homes, and organize their favorite recipes. Best of all, you can browse pinboards created by other people. Browsing pinboards is a fun way to discover new things and get inspiration from people who share your interests.”

Not surprisingly, Pinterest is receiving a lot of coverage on B2B and B2C blogs that provide guidance on the how and why Pinterest can be used by business. The next logical question for me is should Lawyers use Pinterest? if so, how?

Should Lawyers Use Pinterest?

The answer to the first question is simple: Yes, if it is useful to you. Pinterest is a social bulletin board allowing users to “pin”, or save, useful information. It leverages social networks and enables users to track, organize and share products or other content discovered online.  The site allows users to subdivide content by category such as travel, books or food. Finally, axiomatic of all social media is the interaction, allowing friends to follow and view your boards and comment on the items that you’ve posted, or re-pin them on their own boards.

How Can Lawyers Use Pinterest?

The answer to the second question is less simple:


Image by stevegarfield via Flickr

Simply put, Pinterest is an image content curation site where one can create “boards” to which they can add images and comments around a common theme. What’s really interesting is that once one begins using Pinterest, this pen up a whole new way to dialogue with people. Users will “re-pin” your items and it creates an opportunity to contact the user and ask what it about your content that prompted them to re-pin it.

While I am still new to Pinterest, I see it as another valuable social media tool to engage and interact with people. My Pinterest page can be found here.