## Facts

- A consumer purchased Qwest broadband internet service advertised with a “Price for Life Guarantee,” allegedly promising a fixed monthly rate so long as he remained a customer.
- Qwest later increased the monthly rate, and the consumer sued on behalf of a putative class asserting breach of contract, promissory estoppel, unjust enrichment, and a Colorado Consumer Protection Act claim.
- Qwest provided service under a standardized Subscriber Agreement containing (1) an arbitration clause and (2) a class-action waiver.
- Service activation occurred via an installation CD that displayed a “Legal Agreements” screen directing the user to Qwest’s online terms and requiring the user to click “I Accept,” with text stating the click constituted a signature and assent.
- The user could not access the internet service unless the terms were accepted, and the consumer clicked “I Accept.”
- Qwest later mailed a “Welcome Letter” referencing the online terms and providing a 30-day opportunity to cancel; the consumer did not cancel.
- After an earlier order found factual disputes about formation and directed limited discovery, the parties filed cross-motions for summary judgment on whether a binding, enforceable agreement to arbitrate existed.

## Issues

1. Whether the consumer formed a contract with Qwest, including the arbitration clause, by clicking “I Accept” during installation and continuing to use the service.
2. Whether the arbitration provision (and embedded class-action waiver) was unenforceable as an illusory promise because Qwest reserved broad unilateral rights to modify or terminate the Subscriber Agreement.

## Decision

- The court granted summary judgment in part for Qwest on formation, holding the consumer entered into the Subscriber Agreement during installation and remained bound through continued use and failure to cancel after notice.
- The court held the arbitration clause was illusory and unenforceable because Qwest’s unilateral modification provisions were broad enough to permit alteration of arbitration obligations without meaningful constraint.
- The court therefore declined to compel arbitration, leaving the consumer’s claims to proceed in court.

## Legal Principles

- Contract formation is evaluated by objective manifestations of assent; a click-through acceptance process combined with conditional access to service can establish assent to referenced online terms.
- Continued use after notice of governing terms, coupled with an opportunity to cancel, may constitute continued assent to the contract.
- An arbitration agreement is unenforceable if it is supported only by an illusory promise—such as when the drafter retains an effectively unrestricted right to modify or terminate arbitration terms, including after a dispute arises.
- Notice provisions or a generalized duty of good faith do not necessarily cure an arbitration clause where the contract grants unilateral modification power lacking meaningful temporal or substantive limits.

## Conclusion

The court found the parties formed a binding service contract through the installation click-accept process and continued use, but refused to enforce arbitration because Qwest’s unilateral modification rights rendered its promise to arbitrate illusory, permitting the dispute to proceed in court.


Grosvenor v. Qwest Corp., 854 F. Supp. 2d 1021 (D. Colo. 2012)