In 2014, Rachel Stover purchased Experian’s credit score subscription service. The terms of the service required Stover to arbitrate all claims arising out of the subscription service and contained a change-of-terms provision stating that each time Stover accessed Experian’s website, she consented to “the then-current terms” (i.e. new or different terms added or revised after 2014). Stover canceled her Experian subscription one month after purchase and later claimed that Experian fraudulently marketed this credit score as information that lenders review when determining consumers’ creditworthiness.
Stover accessed the Experian website again in 2018, one day before she filed her complaint. At that time, the arbitration provision had changed to exclude certain disputes from arbitration. Stover argued that her dispute was not subject to arbitration pursuant to the 2018 terms. Experian disagreed and argued that a mere visit to the website after the parties terminated their business relationship was insufficient to activate a change in the original terms because Stover had no opportunity to review the new terms and conditions before visiting the website. Experian moved in the trial court to compel arbitration of Stover’s claims. The trial court granted Experian’s motion but held that the 2018 terms applied because of the plain language of the 2014 terms. Stover appealed.
The Ninth Circuit Court of Appeal affirmed the trial court ruling but held that Experian’s 2014 terms applied because Stover did not receive notice of the 2018 version of the terms and conditions. The Court of Appeal held that ruling otherwise would undermine the contract principle requiring mutual assent. The Court of Appeal reasoned that in order to bind parties to new terms pursuant to a change-of-terms provision, the parties must have express notice and an opportunity to review those changes. Thus, the 2018 changed terms did not apply because Stover did not have notice of them and Experian could compel arbitration of her claims under the 2014 arbitration provision.
Stover v. Experian Holdings, Inc. (2020) 978 F.3d 1082.
NOTE:
If a company modifies contract terms and conditions, even with an express change-of-terms clause, it must provide notice to all parties in a manner that allows the parties to expressly consent to the new or changed terms. LCW can help companies navigate the terms of any contract and evaluate appropriate and effective notification strategies.