March 2006 Vol. 104 No. 5 THE REVIEW

Online Boilerplate: Would Mandatory Website Disclosure of E-Standard Terms Backfire?

Robert A. Hillman

A law backfires when it produces results opposite from those its drafters intended. Lots of laws may have backfired. For example, people opposed to hate crimes legislation think that the laws “inflame prejudice rather than eradicate it.” The Endangered Species Act, according to some analysts, has helped destroy rather than preserve the creatures listed by the Act. Even consumer protection laws, some believe, increase prices and confuse consumers instead of protecting them.

This Article analyzes whether mandatory website disclosure of e-standard terms, advocated by some as a potential solution to market failures when consumers contract over the Internet, is another potential legal backfire. By mandatory website disclosure, I do not mean a “clickwrap” presentation of terms, in which a consumer must click “I agree” or the like on a screen presenting the terms prior to the completion of a transaction in progress. Mandatory website disclosure would require a business to maintain an Internet presence and to post its terms prior to any particular transaction so that a consumer could read and compare terms without making a purchase at all.

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