Re: Consideration in a Shrinkwrap Contract

Robert:

Perhaps I misunderstood your comments. I thought you were suggesting that if the money-back option is unavailable because the store refused to return the money (notwithstanding the license agreement providing for the return of the money), the license terms inside the box would then become unenforceable.

It was that proposition that I was addressing. I believe that under those circumstances if the customer goes ahead and installs the program anyway, a court would hold that the customer has "accepted" the terms--rather than finding that the customer is not bound by the terms.

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

Cumbow, Robert wrote:

> I don't see how this is a disagreement with what I originally said.
>
> <snip>
>
> 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
>
Received on Fri Oct 27 2000 - 21:06:03 GMT