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Lee v. Intelius Inc.

United States Court of Appeals, Ninth Circuit

December 16, 2013

Donovan LEE, individually and on behalf of all others similarly situated; Bruce Keithly, individually and on behalf of all others similarly situated, Plaintiffs-Appellees,
v.
INTELIUS INC., a Delaware corporation; Intelius Sales LLC, Defendants-Third-Party-Plaintiffs-Appellees,
v.
Adaptive Marketing LLC, a Delaware Limited Liability Company, Third-Party-Defendant-Appellant.

Argued and Submitted March 7, 2013.

Page 1255

Thomas L. Boeder and Cori Gordon Moore, Perkins Coie LLP, Seattle, WA; Darrel J. Hieber (argued), Jennifer Elaine LaGrange, Kevin James Minnick, and

Page 1256

Jason D. Russell, Skadden, Arps, Slate, Meagher & Flom LLP, Los Angeles, CA, for Third-Party-Defendant-Appellant.

Whitney R. Case, Andrew Neil Friedman, and Victoria S. Nugent, Cohen Milstein Sellers & Toll, PLLC, Washington, D.C.; Mark Adam Griffin, David J. Ko, Karin B. Swope, and Harry Williams, Keller Rohrback LLP, Seattle, WA; F. Paul Bland (argued), Public Justice, P.C., Washington, D.C., for Plaintiffs-Appellees.

Tyler Lawrence Farmer, Calfo Harrigan Leyh & Eakes, LLP, Seattle, WA; Arthur W. Harrigan, Jr., Christopher T. Wion, Danielson Harrigan Leyh & Tollefson, LLP, Seattle, WA, for Defendant-Third-Party-Plaintiffs-Appellees.

Appeal from the United States District Court for the Western District of Washington, Robert S. Lasnik, District Judge, Presiding. D.C. No. 2:09-cv-01485-RSL.

Before: DAVID M. EBEL,[*] WILLIAM A. FLETCHER, and JOHNNIE B. RAWLINSON, Circuit Judges.

OPINION

W. FLETCHER, Circuit Judge:

In June 2008, Plaintiff Donovan Lee purchased on the Internet a background check and report from Intelius. After Lee gave his credit card number and clicked to confirm his purchase, he was directed to a new webpage. Intelius was the only company name that appeared on that page. Lee clicked on a large orange button with the words " YES And show my report." Small print on the page indicated that he had thereby ostensibly obtained a seven-day free trial of a " Family Safety Report" and an obligation to pay $19.95 per month thereafter.

About a year later, Lee discovered that Adaptive Marketing (" Adaptive" ), a separate company from Intelius, had been charging his credit card $19.95 per month for the " Family Safety Report." Lee and other named plaintiffs brought a state-law class action against Intelius. Intelius in turn filed a third-party complaint against Adaptive. Adaptive moved to compel arbitration of both Lee's and Intelius's claims. The district court denied the motion to compel. Adaptive appeals with respect to Lee, contending that Lee agreed to arbitration by clicking the orange button. We affirm.

I. Background

Intelius is an internet-based company that performs background checks, people searches, and " reverse" telephone directory searches. Lee and his fiancé e looked at Intelius's website together, and Lee purchased a background check using his credit card. After Lee made his purchase, he was directed to a new webpage. Intelius submitted to the district court a copy of a webpage that it asserts is identical to the page seen by Lee. We attach a copy of the webpage (unfortunately in black and white in the bound volume) as an appendix to our opinion.

At the top of the new webpage was a message in large black letters, " Thank You," and in smaller but still prominent black letters, " your order has been successfully completed." This was followed, also at the top of the page, by Intelius's colored logo; in large black letters, Intelius's name; and, in smaller black letters, Intelius's marketing slogan, " Live in the

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know." Adaptive's name appeared nowhere on the webpage.

Immediately below the " Thank You" was a dark blue banner on which was written in large white and orange letters, " Take our 2008 Community Safety Survey and claim $10.00 CASH BACK when you try Family Safety Report." The " survey" consisted of two questions: (1) " Does your neighborhood have a sex offender alert program?" (Possible answers: Yes, No, I don't know); (2) " What card type did you use for your Intelius purchase today?" (Possible answers: Credit Card, Debit Card). Below the survey, on the left-hand side of the page, was a box with an instruction in prominent white letters against a green background: " Please type your email address below." Below that, in small, light grey print, was written, " By typing your email address below, it will constitute your electronic signature and is your written authorization to charge/debit your account according to the Offer Details to the right. " (Emphasis added.) There were two spaces in which to type, and then to confirm, an email address. Lee was not asked to resupply his credit card number.

Below the spaces for the email address was written, also in small, light grey print, " By clicking ‘ Yes' I have read and agree to the Offer Details displayed to the right and authorize Intelius to securely transfer my name, address, and credit/debit card information to Family Safety Report, a service provider of Intelius." (Emphasis added.) Below this was a large orange button with the words, written in prominent white letters, " YES And show my report." Below the orange button was a smaller button with the words, written in smaller, underlined ...


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