Marcus, feeling stressed out from work, decided to search for a meditation app for his phone that would help him relax during the day. One app, CalmDown, appeared to be promising. It didn’t have any reviews yet and looked to be a brand-new app, so he decided to try it out. He downloaded the app to his phone and opened it up. The first screen required he enter in his name and email address. At the very bottom of the screen it had some small writing, but Marcus didn’t notice it and hit the continue button.

Had Marcus clicked on the link at the bottom of the screen, he would have seen the following:

The second screen stated “Three-day trial version- Free! $59.99 annual fee thereafter.” Marcus was annoyed that the app would cost him almost $60 but figured he would set a reminder on his phone to cancel the app before the trial period expired so he wouldn’t get charged. Plus, he wanted to see the app in action. If it was actually worth the price, he wouldn’t mind paying the annual fee. He clicked “Continue” and put in his bank card information on the next screen. The following screen asked Marcus a series of questions about his stress level and what he felt caused stress in his life. He clicked “high” and “work” as the level and cause. He then completed the first CalmDown meditation in the app, but was not impressed with its functionality. Deciding he would cancel his subscription immediately, he went into the profile settings to try to find the cancel option but couldn’t. He searched every possible place on the app but didn’t see a way to cancel the subscription. Marcus decided to try to find the app’s developer through their website, but a quick search didn’t turn up anything. Already stressed and becoming more frustrated, Marcus decided to contact the app store. They informed him that he should be able to go into his app store account and cancel the subscription there. However, when Marcus went there, he didn’t see the app as an option or as a subscription. Thinking that maybe his subscription didn’t process, he just deleted the app from his phone.

Marcus didn’t give the app or the subscription any more thought, becoming increasingly more distracted by the amount of stress at work. Four months later, Marcus was looking at his bank account online and noticed it was lower than it should have been. He began reviewing the charges and noticed multiple charges for $59.99 to a merchant named “CDgotU.” He immediately remembered the app and contacted his bank to dispute the charges. His bank replied that due to the charges being debit withdraws he needed to dispute them within 2 days of being made. Moreover, if he had been diligent about watching his account, they could have put a block on the account and the remaining fraudulent charges would have been prevented. The bank representative also told him that he should try to get a refund from the company that charged him. After making his case with the bank representative for several hours about how he tried to cancel his subscription, he was unsuccessful. The bank’s representative was able to provide Marcus a phone number attached to the Merchant account, but when Marcus called the number it was disconnected. The bank could not provide him with any additional information such as a company address or website.

After more internet searching, Marcus saw a number of other complaints online about the app, and noticed it had been removed from the app store and was no longer available for download. Marcus decided to bring an action against the company for fraud, breach of contract, conversion, and several other claims in his home state of Vermont.

Discussion Questions

Answer each of the following questions in 3-5 sentences:

1. If a company develops an app for sale, should they be subject to the jurisdiction of every court across the country? Why or Why not?

2. If the small print at the bottom of the first screen stated, “By continuing to use this app, user agrees to abide by the terms of service provided at www.CD8765lkapp.com” (a website not easily found through an internet search and which contains nothing other than the terms) should Marcus or other users be held to those terms?

3. What benefits are there for a company that requires its customers to submit to arbitration agreements as opposed to litigation? What are the disadvantages?

4. Should the bank or the app store be required to do more due diligence on companies using their services to sell a product, limiting the offerings of companies who do not pass their screening, or should they only provide a platform for commerce to take place and allow the market to monitor companies?.Break into groups of 3 or more, with one person acting as a Judge. The remaining group members should be equally divided into two sides: one representing the company and one representing users such as Marcus. Using the information presented in the scenario, present arguments for why your side should prevail in a lawsuit brought by the company to compel arbitration. The Judge should make a final ruling based on the arguments.

Answer the following in 5-10 sentences.

The maker of the CalmDown app, 15-year-old Nuvua Adams, created it for a school entrepreneurship project and never expected that people would actually buy it. She didn’t know anything about the law and looked at the project as more of a 21st-century lemonade stand, where she might be able to earn a few dollars in addition to getting school credit. She wrote the terms of use, which seemed reasonable in her mind, but spent the majority of her time writing the code for the app. Is it reasonable to hold Nuvua to the same legal standards as a large company with millions of dollars in resources and entire legal departments committed to protecting the company? Has Nuvua met ethical and legal standards for the development and sale of a product to the public?

Answer the following in 5-10 sentences.

The maker of the CalmDown app, 15-year-old Nuvua Adams, created it for a school entrepreneurship project and never expected that people would actually buy it. She didn’t know anything about the law and looked at the project as more of a 21st century lemonade stand, where she might be able to earn a few dollars in addition to getting school credit. She wrote the terms of use, which seemed reasonable in her mind, but spent the majority of her time writing the code for the app. Is it reasonable to hold Nuvua to the same legal standards as a large company with millions of dollars in resources and entire legal departments committed to protecting the company? Has Nuvua met ethical and legal standards for the development and sale of a product to the public?