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February 08, 2008

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Bruce Boyden

Like everyone, I found this to be a fascinating paper. I'm still trying to work out the distinction between problems associated with "new servitudes," and the vast literature on problems with boilerplate form contracts. In this post and I believe the article, you contrast the new servitudes with dickered agreements, but I'm not sure that's the right comparison -- most mass-market consumer contracts are not dickered. And once the comparison is form contracts, the differences start to become less salient. Sure, in theory, you could attempt to bargain with Sears over the terms of that refrigerator warranty. You might call Comcast and attempt to get more information from a customer service representative on what the terms of your service agreement mean. Good luck with that. I think in the vast majority of cases, consumer B who purchases directly from large company A is in exactly the same position as consumer D, who got the widget from C, who in turn got it from B, who originally purchased it from A. I.e., equally in the dark.

I'm not sure the two points above materially distinguish A to D servitudes from A to B form consumer contracts. On the high salience of physical possession, if B and D are both clueless about the terms and what they mean, why is D attaching special significance to the fact that A would claim (if it ever comes up) that the terms still bind D due to D's possession? As to scope, given the current and probable future prevalence of A to B form consumer contracts, as a class I'm not sure the A to D contracts are adding much in terms of total information cost. It's just one more click-through to ignore. I suppose the situation would be different where A asserts that D is bound by an agreement that D never received a copy of (because it's not intimately associated with the product somehow, such as a click-through window, and was not passed by the prior owners), and it's something beyond the legal rights A would have outside of any agreement. That would be problematic. But most EULAs, I would think, would not fall in that category of cases.

One possibility is to argue that the remoteness of D from A matters because D, unlike B, was not even in a position to directly see the non-contractual material -- the advertising flyers and so forth -- that B did when purchasing the product. So D might not have the opportunity to see that "Entertain your friends!" has an asterisk next to it: "Subject to our terms and conditions." But if it's true that no one ever reads the terms and conditions, including B, then at most D lacks the constructive but non-actual notice that B has.

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