## Facts

- MSN subscribers brought a putative nationwide class action alleging Microsoft changed MSN billing by rolling customers into higher-priced plans without notice or consent.
- Plaintiffs asserted claims including breach of contract, common law fraud, and consumer fraud.
- MSN required users to accept an online clickwrap subscriber agreement presented on computer screens with scrollable terms and “I agree/I disagree” buttons.
- Users could not begin using MSN unless they clicked “I agree”; each named plaintiff did so.
- The agreement included a clause selecting Washington law and requiring exclusive jurisdiction and venue in courts in King County, Washington for disputes arising out of or relating to MSN use or membership.
- Plaintiffs filed suit in New Jersey state court; Microsoft moved to dismiss based on the forum-selection clause.
- The trial court dismissed for improper forum, and plaintiffs appealed.

## Issues

1. Whether the clickwrap subscriber agreement, including the forum-selection clause, formed a binding contract through users’ online assent.
2. Whether the forum-selection clause requiring exclusive litigation in King County, Washington was enforceable under New Jersey law so as to require dismissal of the New Jersey action.

## Decision

- The Appellate Division affirmed the dismissal.
- The clickwrap agreement was an enforceable contract because users had the opportunity to review the terms and manifested assent by clicking “I agree.”
- The forum-selection clause was presumptively valid and plaintiffs failed to show grounds to invalidate it.
- Enforcing the clause did not violate New Jersey public policy and did not impose serious trial inconvenience, particularly given the nationwide dispersion of the proposed class.

## Legal Principles

- Forum-selection clauses are generally enforceable unless the resisting party shows: (1) fraud or overreaching in inclusion of the clause, (2) violation of a strong public policy of the forum state, or (3) serious inconvenience that would effectively deprive the party of a day in court.
- A clickwrap agreement can create a binding contract when terms are presented with a meaningful opportunity to review and use of the service is conditioned on an affirmative “I agree” assent.
- An adhesion contract’s forum-selection clause is not invalid solely because of unequal bargaining strength when consumers have realistic market alternatives and the clause is reasonably disclosed.

## Conclusion

The court held that MSN subscribers were bound by the clickwrap terms they accepted and that the agreement’s forum-selection clause required the dispute to be litigated exclusively in King County, Washington, making dismissal of the New Jersey action proper.


Caspi v. Microsoft Network, L.L.C., 323 N.J. Super. 118, 732 A.2d 528 (App. Div. 1999)