Kemp v. Aroma 360, LLC

Summary

The United States District Court for the District of Maryland considers Aroma 360, LLC’s motion to stay litigation and compel arbitration in a product-liability action arising from injuries allegedly caused by a defective candle. Applying Maryland contract-formation principles, the court concludes that the website’s Terms of Service provided reasonable notice, that Kemp manifested assent, and that the arbitration provision was not unconscionable. The motion to compel arbitration is granted.

Holdings

1. Maryland contract-formation principles govern the court's determination whether the parties formed an enforceable arbitration agreement.
2. A website provides reasonable notice of contractual terms when, considering the whole webpage, its design and content would put a reasonably prudent user on notice that contractual terms are being offered.
3. A user may manifest assent to online contractual terms through conduct, including proceeding with a purchase, when the website clearly signals that continued use or completion of the transaction constitutes agreement to the terms.
4. The arbitration provision was not unconscionable and unambiguously covered Kemp's personal-injury claims arising from use of a purchased product.
5. Kemp forfeited her argument that the arbitration agreement lacked consideration because she raised it for the first time in a supplemental brief after the initial briefing had concluded.

Questions Presented

1. Whether Maryland or Florida law governed the enforceability and formation of the online arbitration agreement.
2. Whether the checkout-page design gave Kemp reasonable notice of the Terms of Service and arbitration agreement.
3. Whether Kemp manifested assent to the Terms of Service and arbitration provision by proceeding with the online purchase.
4. Whether the arbitration provision was unconscionable because it allegedly did not clearly cover personal-injury claims or provide adequate notice of the opt-out procedure.
5. Whether Kemp forfeited her consideration argument by raising it for the first time in a supplemental brief.

Disposition

other