Page 179 - A Study on the Role of UGC Platforms in Copyright Law：An Intermediary-oriented Approach

A Study on the Role of UGC Platforms in Copyright Law: Chapter 6 UGC Platforms’ Entitlement to UGCs
An Intermediary-oriented Approach

adhesion contracts that do not require the users’ active participation in the making or even
acceptance of the terms.
Adhesion contracts are not unique to the UGC age. They emerged early in the 20
th
century, with the standardization of product and service production and distribution. In
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addition, there was an irresistible trend towards impersonal market transactions, to cut down
negotiation costs in individual cases. Adhesion contracts gained popularity in the Internet
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age because of the massive scale of users wanting the same service. ToUs/ToSs have usually
fallen under one of the following forms of adhesion contracts: shrink-wrap contracts, click-
wrap contracts, scroll-wrap contracts, sign-in contracts and browse-wrap contracts.
Shrink-wrap contracts are contracts packaged with products, equating the use of the
product with the acceptance of the contract. A common type of shrink-wrap contract is
the end user licence agreements (EULA) attached to software. With more and more users
gaining access to UGC platforms via smartphone apps, ToUs/ToSs have increasingly taken
the form of shrinkwrap contracts that require the user to agree with the terms before they
can download and install the app. For example, WeChat’s ToU states that ‘[y]ou may not
download, install or use the Software and related services unless you have read and accepted
all the terms of this Agreement. Your downloading, installation, use, acquisition of any
Weixin account, login and other similar acts shall be deemed that you have read and agreed
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to be bound by the Agreement’.
The problem is that users cannot examine the terms and conditions prior to downloading
the software, prompting the question of whether they have received sufficient notice of the
offer before acceptance. This question remained unanswered until ProCD v. Zeidenberg in
which the Seventh Circuit Court of Appeals overturned the lower court’s decision and upheld
the validity and enforceability of a shrink-wrap contract, on the ground that the shrink-wrap
contract in question gave users the opportunity to review the licence and return the goods
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if they found the terms too demanding to accept. As users who are unsatisfied with the
ToU/ToS can uninstall and delete the app, and most apps are free, shrink-wrap ToUs/ToSs
attached to an app satisfy the notice requirement.
A click-wrap contract, as its name suggests, requires users to indicate their consent by
clicking on the ‘OK,’ ‘I accept’ or ‘I agree’ button under the ToU/ToS. Similar to a click-
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69 Arthur Lenhoff, ‘Contracts of Adhesion and the Freedom of Contract: A Comparative Study in the Light of American and
Foreign Law’ (1961) 36 Tulane Law Review 481, 481.
70 Friedrich Kessler, ‘Contracts of Adhesion--Some Thoughts About Freedom of Contract’ (1943) 43 Columbia Law Review
629, 632.
71 Agreement on Software License and Service of Tencent Weixin <https://weixin.qq.com/cgi-bin/readtemplate?lang=en&t=weixin_
agreement&s=default&cc=CN> accessed 18 May 2019.
72 ProCD, Inc. v. Zeidenberg, 86 F.3d 1447, 1452-1453 (7th Cir. 1996) But see Carnival Cruise Lines. v. Shute, the US Supreme
Court upheld a dispute resolution clause despite that the clause was printed on the back of a customer's cruise ticket and the
customer has no opportunity for refunds at the point when the forum selection clause was disclosed. Carnival Cruise Lines,
Inc. v. Shute, 499 U.S. 585, 591 (1991).
nd
73 e.g., Nicosia v. Amazon.com, 834 F.3d 220, 233 (2 Cir. 2016); Whitt v. Prosper Funding LLC, 2015 WL 4254062 at *1, *4 (S.D.N.Y.
July 14, 2015); Berkson v. Gogo LLC, 97 F. Supp. 3d 359, 386, 398 (E.D.N.Y. 2015) (terming such agreements 'scrollwraps').

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