RE: Consideration in a Shrinkwrap Contract

I don't see how this is a disagreement with what I originally said.

Robert C. Cumbow
 Graham & Dunn PC
 1420 Fifth Avenue, 33rd Floor
 Seattle, WA 98101-2390
 206.340.9619
 206.340.9599 fax
 rcumbow[_at_]grahamdunn.com
 http://www.grahamdunn.com  

        Big law firm experience
> without the big law firm experience®

-----Original Message-----
From: Brad Englund [mailto:benglund[_at_]halversonlaw.com] Sent: Monday, October 23, 2000 10:43 AM
To: Multiple recipients of list
Subject: Re: Consideration in a Shrinkwrap Contract

Cumbow, Robert wrote:

> I'm not sure, not claiming to be an expert in such matters. But it seems
to
> me if the money-back option is unavailable then the customer has lost the
> ability to accept or decline the terms, thus providing him with a pretty
> good argument that the terms are unenforceable. I'd be interested in
others'
> opinions, though.

I disagree. In Brower v. Gateway 2000, Inc., 246 A.D.2d 246, 250, 676 N.Y.S.2d
569 (1998), the court held that a shrink-wrap contract between the parties was
not formed until after the period had run to return the merchandise. Thus, if a
consumer attempts to return the software and the store refuses to return the money, no contract ever formed. Which means that the sale fails for lack of consideration. Alternatively, a contract has been formed, but the vendor has
violated the perfect tender requirement, and the consumer can refuse tender of
the software.

In either case, consumer can sue to get his or her money back. However, the consumer cannot use the software in violation of the shrink-wrap agreement (except, perhaps, in a "cover" situation). Using the software after the store
refuses to return the money (except in a cover situation) may be considered "acceptance" of the software. In that event, the consumer's sole remedy will be
to sue for the damages caused by the imperfect tender (i.e, those damages that
flow from the license terms that prohibit a use that the consumer intended).

Brad Englund
Halverson & Applegate, P.S.
Yakima, WA

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