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Monday, December 07, 2020

Consumer Contracts and Addressing the Boilerplate Challenge

Samuel Becher has two interesting articles up on ssrn about consumer boilerplate contracts. In Taking Boilerplate Seriously: Tackling Exploitation in Consumer Contracts Becher and Yehuda Adar propose a professional system of administrative oversight over the content of consumer form contracts. They propose to tackle the widespread use of unfair practices as well as unconscionable and plainly illegal terms in a way that is more proactive, regulatory and ex-ante, rather than the private law system that currently is relied upon. This proposal very much resonates with the argument I have been developing in the context of unenforceable employee contracts, such as non-competes and overreaching innovation assignment/proprietary information clauses -- that agencies like the FTC, the EEOC, the antitrust division, and the Dept of Labor should coordinate enforcement and prevention, rather than rely on courts to address enforceability and public policy ex post. here and see here for example.

In Termination without Explanation, he and his coauthor Uri Benoliel empirically study consumer agreements that allow firms to terminate their contract without disclosing the reason for termination. The Article examines the contractual termination mechanisms of 500 sign-in-wrap contracts of the most popular websites in the United States, finding that the vast majority of these contracts are non-transparent termination without explanation contracts. They propose to impose a duty to explain on firms. 

Posted by Orly Lobel on December 7, 2020 at 04:49 PM | Permalink


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