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Brief Fact Summary.
Hoffman appealed a judgment that did not allow him to file suit against Supplements Togo Management, LLC, due to a forum-selection clause disclaimer that was discretely displayed on the company’s website.
Synopsis of Rule of Law.
A forum-selection clause is enforceable if the clause has a clear purpose and is presented in a fair and forthright manner.
The court was unpersuaded that a reasonably prudent person in these circumstances would have known of the existence of the license terms.
View Full Point of Law
Hoffman, a New Jersey resident, bought a dietary supplement online from Supplement Togo Management, LLC (STM). STM had a forum-selection clause that required all claims to be brought in Nevada. The disclaimer is not present to purchasers unless the buyer scrolls to the bottom of the page. Hoffman sued STM in New Jersey and STM moved to dismiss the suit due to the forum-selection clause disclaimer. The lower court granted judgment to STM and Hoffman appealed.
Issue.
Whether a forum-selection clause is enforceable if the clause has a clear purpose and is presented in a fair and forthright manner?
Held.
Yes. The trial court judgment is reversed. Courts have not upheld forum-selection clauses where that are contained on the lower portion of a webpage. Because STM’s forum-selection clause was submerged on the webpage, the clause was not presented in a fair and forthright manner.
Discussion.
If the forum-selection clause is valid, the plaintiff can only bring suit in the forum state. A forum-selection clause is valid if it is mutually agreed upon, consideration exists, and public policy is not violated. A forum-selection clause is mutually agreed upon when each party is informed of the terms prior to entering the agreement.