Court’s Invalidation of Zappos.com’s Arbitration Provision Offers Lessons for Company Websites

Late last year, the United States District Court of Nevada handed down a ruling that has significant consequences for companies engaged in commerce on the internet.[1] In the case, customers of online retailer Zappos.com sued the company seeking damages resulting from a security breach in which a hacker accessed Zappos’ customer information in 2012. Zappos attempted to invoke the arbitration provision contained in its website’s Terms of Use, but the court held that the Terms of Use did not constitute a valid or enforceable agreement to arbitrate. [Read more…]