Court Considers Reduce My Bills Form Sufficient for Binding Arbitration


Well, here’s a big decision for a Monday morning.

As TCPAWorld readers know, the recent decision in berman really changed the game. But a Michigan court suggests the game hasn’t changed as much as it seems.

In Dustin Shirley, plaintiff, v. Rocket Mortgage, Slip Copy2022 WL 2541123 (ED Mich. July 7, 2022), the court ruled that – a popular lead generation site – provided sufficient notice to users to allow a primary buyer to apply a arbitration clause. And that’s a big problem.

In Shirley, the applicant admitted to visiting the website, but claimed that the format of LMB did not meet the requirements of Berman. Specifically, he argued that the disclosure was too small and that the button did not include any indication that clicking it would result in acceptance of the terms.

Here is the form

The Court disagreed with the plaintiff’s arguments. First, the court found that the tongue – despite being below the button – was prominent enough that a consumer was likely to see it.

Second, the hyperlinks were nice and blue – at least on the second disclosure where the requester agreed to LMB’s terms and conditions – so that was a big distinguishing point of Berman.

Third, although the button just said “Calculate”, unlike Berman, the disclosure language actually indicated that clicking the button above would cause something legally effective to happen.

Arbitration was therefore applied.

Notably, there was another Chaos Ball moment in this as well. The defendant in the lawsuit was Rocket Mortgage. And technically, the Rocket Mortgage disclosures had not been ostensibly displayed to the plaintiff. But the plaintiff apparently stipulated at the hearing that Rocket “may enforce LMB’s arbitration agreement with Shirley as an intended third party beneficiary.” So… sometimes it’s better to be lucky than good.

So takeaway here:

  1. At least some courts will continue to enforce disclosures when the language is under the button. Although not best practice, it seems to be acceptable in some places at the moment;

  2. At least some courts will continue to enforce disclosures where a button simply says “Continue” so long as the wording of the disclosure reads “By clicking the button, you agree…regardless of the terms”;

  3. Hyperlinks must be in color. The Court wasn’t going to enforce Rocket’s terms and conditions because they weren’t hyperlinked. They lost their belts but they had suspenders when LMB’s own revelations were deemed enough to cover them.

Be careful here, though. This is just one district court, one data point. Some courts might disagree. And until standards are set and approved by regulators – or until more appellate courts consider this issue – it’s best to BE CONSERVATIVE AND TRANSPARENT with your forms.

But for now, it’s a big win.

© 2022 Troutman CompanyNational Law Review, Volume XII, Number 192


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