Lauren VanWormer, et al. v. Urban Outfitters, Inc.

• Court: District Court, E.D. Pennsylvania
• Decided: April 10, 2026
• Docket: 2:26-cv-02757
• Status: Unknown

Opinion

1 2 3 4

5 UNITED STATES DISTRICT COURT 6 WESTERN DISTRICT OF WASHINGTON AT SEATTLE 7 8 LAUREN VANWORMER, et al., 9 Plaintiffs, Case No. C25-2386-MLP 10 v. ORDER 11 URBAN OUTFITTERS, INC., 12 Defendant. 13

14 I. INTRODUCTION 15 This matter is before the Court on: (1) Defendant Urban Outfitters, Inc.’s (“Defendant”) 16 Motion to Transfer Class Action Complaint (“Transfer Motion” (dkt. # 16)); (2) Defendant’s 17 Motion to Compel Arbitration and Stay Action (“Arbitration Motion” (dkt. # 18)); and (3) 18 Plaintiffs Lauren VanWormer and Mallory Santic’s (together, “Plaintiffs”) Motion to Certify 19 Question of Law to the Washington Supreme Court (“Certification Motion” (dkt. # 33)). 20 Plaintiffs filed oppositions to Defendant’s Motions (“Transfer Resp.” (dkt. # 26); “Arbitration 21 Resp.” (dkt. # 25)), and Defendant filed replies (“Transfer Reply” (dkt. # 27); “Arbitration 22 Reply” (dkt. # 28)). Defendant filed an opposition to Plaintiffs’ Certification Motion 23 (“Certification Resp.” (dkt. # 34)), and Plaintiff did not file a reply. 1 Il. BACKGROUND 2 Plaintiffs seek to represent a class of Washington consumers to whom Defendant 3 || allegedly sent false and misleading email marketing. (Compl. (dkt. # 1-1).) Defendant contends 4 || this dispute must be adjudicated in another forum because Plaintiffs entered into enforceable 5 || contracts with forum selection and arbitration provisions. (Transfer Mot., Arbitration Mot.) 6 Defendant submits a declaration from Senior Manager of Enterprise Technology Michael 7 || Schur stating that Plaintiffs created “UO Rewards” accounts on Defendant’s website in 2018 and 8 (Schur Decl. (dkt. # 17), Jf 4, 26, 29.) The registration page is shown below: 9 10 CREATE AN ACCOUNT ALREADY HAVE AN ACCOUNT?

i Password *

13 Confirm Your Password * 14 By creating an account, you agree to receive Urban Outfitters 15 es inoubocrbe atanytine.

16 ruber not my

19 (Id., Ex. A.) To register, Plaintiffs were required to click the large black button labeled “Create 20 an Account,” which is positioned directly above small text stating that, “[b]y creating an account, 71 you agree to Urban Outfitters terms of use and privacy policy.” (/d., § 4.) The underlined terms 22 were hyperlinked; the “terms of use” link led to a page (the “Terms”) that informed users that 23

1 || they “irrevocably submit to the exclusive jurisdiction of the federal and state courts of the State 2 || of Pennsylvania.” (/d., J] 5-7, Ex. B at 16; see also id., Exs. D at 27, G at 44.) 3 Both Plaintiffs made multiple purchases on Defendant’s website, Ms. Santic most 4 || recently in February 2021 and Ms. VanWormer in February 2025. (Schur Decl., [J 27, 30.) A 5 || redacted sample of the payment screen is shown below: 6 || URBAN OUTFITTERS □

Contact information : Order Summary 8] —_ es 9 wos he We rene recat : □□□□

DI, Payment Information

12 13

16 | Mon, April 17 » 05 Free —

18 The, Ap 19 -$2495 19 50 (Id., Ex. C; see also id., Ex. F.) To make a purchase, users were required to click the large button

labeled “Place Order,” which is positioned above text stating that, by placing an order, users have agreed to Defendant’s “terms of use” and “arbitration agreement.” (/d., 9] 8-9, Ex. C.) The

33 underlined terms hyperlink to the Terms page and to a page titled “Urban Outfitters Arbitration Agreement.” (/d., J 9.) The Arbitration Agreement page provided that “any controversy, claim,

1 action, or dispute in any way related to your use of any Urban Outfitters website, any purchase 2 from Urban Outfitters, or to any products or services sold or distributed by Urban Outfitters . . . 3 will be resolved by this dispute resolution procedure and arbitration agreement[.]” (Id., ¶¶ 13-14, 4 17, Ex. E; see also id., ¶¶ 21-22, Ex. H.)

5 III. DISCUSSION 6 Defendant contends that both Plaintiffs entered into valid contracts with enforceable 7 venue and arbitration provisions when they clicked the “Create an Account” or “Place Order” 8 buttons. Plaintiffs respond that no contract was formed because the underlined language, in tiny 9 print, was not conspicuous enough to give them notice. 10 A. The Parties Entered into a Contract via the UO Rewards Program 11 In the context of online agreements, a contract is formed if the user had “actual or 12 constructive notice of the provisions.” Wilson v. Huuuge, Inc., 944 F.3d 1212, 1219 (9th Cir. 13 2019) (applying Washington law1). Absent actual notice, “an enforceable contract will be found 14 based on an inquiry notice theory only if: (1) the website provides reasonably conspicuous notice

15 of the terms to which the consumer will be bound; and (2) the consumer takes some action, such 16 as clicking a button or checking a box, that unambiguously manifests his or her assent to those 17 terms.” Berman v. Freedom Fin. Network, LLC, 30 F.4th 849, 856 (9th Cir. 2022). The second 18 requirement was met here when Plaintiffs clicked buttons manifesting assent while signing up 19 for the UO Rewards program.2 20

1 Where different states’ law would “apply substantially similar rules, we need not engage in a detailed 21 choice-of-law analysis.” Oberstein v. Live Nation Entm’t, Inc., 60 F.4th 505, 515 (9th Cir. 2023) (cleaned up). Neither party argues that another state’s law should apply or that the choice of law would alter the 22 outcome.

23 2 Plaintiffs appear to suggest that they may have signed up for UO Rewards some other way than using the website, but offer no evidence or even allegations in support. (Transfer Resp. at 4, 10.) The Court may 1 Courts recognize a spectrum of methods to provide constructive or inquiry notice. At one 2 end are generally unenforceable “browsewrap” contracts, which purport to bind users who 3 merely visit the website, and at the other end are generally enforceable “clickwrap” or 4 “scrollwrap” contracts, which present the contract terms and require clicking a button stating

5 agreement with those terms before proceeding. Keebaugh v. Warner Bros. Entm’t Inc., 100 F.4th 6 1005, 1014 (9th Cir. 2024). In between are “sign-in wrap” agreements like the one at issue here. 7 Id. These are enforceable where the notice of terms is sufficiently conspicuous. Id. 8 “[T]o be conspicuous in this context, a notice must be displayed in a font size and format 9 such that the court can fairly assume that a reasonably prudent Internet user would have seen it.” 10 Berman, 30 F.4th at 856. Terms may be disclosed through hyperlinks; however, “the fact that a 11 hyperlink is present must be readily apparent.” Id. at 857. 12 In addition to “visual aspects,” including “placement of the notice,” the Ninth Circuit has 13 held that courts must consider the “context of the transaction” in assessing whether notice was 14 sufficient. Keebaugh, 100 F.4th at 1018-20. Several cases have identified a variety of situations

15 that put reasonably prudent users on notice that they are creating an ongoing relationship for 16 which they should expect governing terms, such as downloading an app that offered in-app 17 purchases to one’s own device, completing a “full registration process” displaying notice 18 multiple times in order to make a purchase, or purchasing a game and later extra items within the 19 game. Id. at 1017, 1019-20 (citing B.D. v. Blizzard Entertainment, Inc., 76 Cal.App.5th 931 (Cal. 20 Ct. App. 2022); Oberstein, 60 F.4th 505). 21 22

23 rely on Defendant’s evidence where Plaintiffs “fail to offer contradictory evidence” and “do not show or even argue [that Defendant’s] evidence submitted to the Court is inaccurate.” Saeedy v. Microsoft Corp., 757 F. Supp. 3d 1172, 1193-94 (W.D. Wash. 2024). 1 Here, the context of the transaction was sufficient to signal a continuing relationship. 2 Plaintiffs created accounts specifically to access ongoing rewards on a signup page that stated: 3 “By creating an account, you agree to receive Urban Outfitters marketing emails to get first dibs 4 on new arrivals, sales, exclusive content and more! You may unsubscribe at any time.” (Schur

5 Decl., ¶ 4, Ex. A.) As in Keebaugh, this was “different from a typical one-and-done interaction 6 between the user and a . . . website[.]” 100 F.4th at 1020. In creating an account, “a consumer is 7 more likely to expect a continuing relationship.” Saeedy v. Microsoft Corp., 757 F. Supp. 3d 8 1172, 1196 (W.D. Wash. 2024). Accordingly, users would “likely expect (and reasonable 9 prudent users should expect) their access to the [UO Rewards program] to be continual.” 10 Keebaugh, 100 F.4th at 1020. 11 The UO Rewards signup page “also satisf[ies] the visual requirements to provide 12 conspicuous notice that ‘a reasonably prudent Internet user would have seen.’” Keebaugh, 100 13 F.4th at 1020 (quoting Berman, 30 F.4th at 856). Directly beneath the operative “Create an 14 Account” button was text clearly advising that by creating an account, users agree to terms of

15 use. (Schur Decl., ¶ 4, Ex. A.) Proximity enhances conspicuousness. See Oberstein, 60 F.4th at 16 517 (“The notices were not buried on the bottom of the webpage or placed outside the action 17 box, but rather were located directly on top of or below each action button.”). The gray text is 18 clearly legible against a white background and there are few other elements to distract from the 19 notice. The hyperlink to the Terms was also underlined, an increasingly common way to denote 20 hyperlinks. 21 Plaintiffs argue that the signup page resembles the sign-in wrap agreements in Berman, 22 where the notice, in “barely legible” “tiny gray font,” contained hyperlinks that were underlined 23 but not otherwise identifiable. (Transfer Resp. at 7 (quoting Berman, 30 F.4th at 856-57).) The 1 Ninth Circuit held that “[s]imply underscoring words or phrases . . . will often be insufficient to 2 alert a reasonably prudent user that a clickable link exists.” Berman, 30 F.4th at 857. As an initial 3 matter, the Court notes that Berman involved users signing up for free samples, which does not 4 presuppose an ongoing relationship. See id. at 853. Moreover, viewing the UO Rewards signup

5 page as a whole, the visual aspects more closely resembled those in Keebaugh than Berman. 6 “Unlike the notices at issue in Berman, the sign-in screen here lacks clutter and uses 7 ‘[c]ustomary design elements denoting the existence of a hyperlink.’” Keebaugh, 100 F.4th at 8 1021 (quoting 30 F.4th at 857). In addition, the language below the Create an Account button 9 “clearly denotes that continued use will constitute acceptance of the Terms[.]” Id. at 1021-22 10 (cleaned up). Reviewing the visual elements as a whole, and given the context of the transaction, 11 “[t]he notice is conspicuous and puts the reasonable user on notice that they are agreeing to be 12 bound by the Terms of Service.” Keebaugh, 100 F.4th at 1021. The Court thus concludes that 13 Plaintiffs agreed to the Terms, including the forum selection clause. 14 Plaintiffs contend, however, that no valid contract exists because a change-in-terms

15 provision renders the Terms illusory.3 (Transfer Resp. at 10-12.) Plaintiffs point to a section of 16 the Terms governing UO Rewards, where a provision titled “Termination and Modification” 17 states, in pertinent part, that Defendant “may, in our discretion, cancel, modify, restrict or 18 terminate these [UO Rewards terms and conditions] and/or the [UO Rewards] Program or any 19 20 3 Plaintiffs argue in their briefing that the Terms were “unenforceable” as illusory. (Transfer Resp. at 11.) At oral argument, they clarified that they were not raising a defense to enforcement, which a Pennsylvania 21 court would determine, but challenging the existence of a contract at all. (See dkt. # 36.) Washington courts hold that if one side’s obligations are illusory, no contract can be formed. See, e.g., Interchange 22 Assocs. v. Interchange, Inc., 16 Wn. App. 359, 361 (Wash. Ct. App. 1976) (“When there is an absolute right to not perform at all, there is an absence of consideration” to support contract formation.); Bascetta 23 v. Advantage Equip. Leasing, L.L.C., 132 Wn. App. 1037, at *4-5 (Wash. Ct. App. Apr. 18, 2006) (“A purported offer that reserves the power to withdraw at will . . . is not an offer at all. It is an invitation to submit an offer. . . . It is not a contract.”). 1 aspect or feature of the Program at any time without prior notice,” even though such changes 2 may affect benefits already earned.4 (Schur Decl., Exs. B at 16, D at 27, G at 44.) 3 Plaintiffs rely solely on an employment wage and hour action where the Washington 4 Supreme Court noted, in dicta, several out-of-state employment cases where courts “refused to

5 enforce arbitration clauses as illusory promises to arbitrate where the agreement allows [the 6 employer] to unilaterally modify the arbitration agreement.” (Transfer Resp. at 11 (quoting 7 Burnett v. Pagliacci Pizza, Inc., 196 Wn.2d 38, 53 n.4 (Wash. 2020)).) The Burnett court 8 expressly declined to reach the issue, however, as the appeal was resolved on other grounds. 196 9 Wn.2d at 53 n.4. While Burnett may signal how Washington courts regard employment 10 contracts, this Court finds cases addressing consumer contracts more instructive. 11 With regard to consumer contracts, “Washington and Ninth Circuit courts have a history 12 of enforcing contracts containing change-in-terms provisions.” Ekin v. Amazon Servs., LLC, 84 13 F. Supp. 3d 1172, 1176 (W.D. Wash. 2014) (collecting cases). “In Washington, a contract is 14 illusory only if it lacks all consideration and mutuality of obligation, e.g., the promisor has no

15 obligations with regard to any parts of the contract.” In re Amazon Serv. Fee Litig., 705 F. Supp. 16 3d 1255, 1269 (W.D. Wash. 2023) (cleaned up), aff’d, 2025 WL 2268252 (9th Cir. Aug. 8, 17 2025). In the Amazon Service Fee Litigation, another court in this district upheld a change-in- 18 terms provision enabling Amazon to revoke free grocery delivery because “[c]ancellation of one 19 benefit does not render the contract ‘completely illusory’” where Amazon continued providing 20 other benefits. Id. Defendant, here, has not utilized the change-in-terms provision to remove a 21 benefit. Plaintiffs do not contend that the benefits they received by signing up for the UO 22

23 4 A provision applicable to the entire Terms similarly states that Defendant “reserves the right to update or modify these Terms and Conditions at any time without prior notice.” (Schur Decl., Exs. B at 14, D at 20, G at 37.) 1 Rewards program were altered or diminished. Under these circumstances, the change-in-terms 2 provision does not render the Terms illusory. 3 Accordingly, the Court concludes that Plaintiffs agreed to an enforceable forum selection 4 clause.

5 B. The Forum Selection Clause Requires Transfer 6 The Terms’ forum selection clause is mandatory, as it restricts the parties to the 7 “exclusive jurisdiction” of Pennsylvania courts. See Powell v. United Rentals (N. Am.), Inc., 8 2019 WL 1489149, at *4 (W.D. Wash. Apr. 3, 2019). The proper mechanism to enforce a 9 mandatory forum selection clause is a motion to transfer venue pursuant to 28 U.S.C. § 1404(a). 10 Atl. Marine Const. Co. v. U.S. Dist. Ct. for W. Dist. of Texas, 571 U.S. 49, 52 (2013). 11 “For the convenience of parties and witnesses, in the interest of justice, a district court 12 may transfer any civil action to any other district or division where it might have been brought or 13 to any district or division to which all parties have consented.” 28 U.S.C. § 1404(a). While a 14 § 1404(a) motion ordinarily requires consideration of a variety of public and private interest

15 factors, a valid forum selection clause means that all private factors favor transfer and “a district 16 court should transfer the case unless extraordinary circumstances unrelated to the convenience of 17 the parties clearly disfavor a transfer.” Atl. Marine Const. Co., 571 U.S. at 52 (2013); see id. at 18 66 (“In all but the most unusual cases, . . . ‘the interest of justice’ is served by holding parties to 19 their bargain.”). The party violating the forum selection clause “must bear the burden of showing 20 that public-interest factors overwhelmingly disfavor a transfer.” Id. at 67. Here, Plaintiffs have 21 raised no public-interest factors disfavoring transfer. Accordingly, the Court grants Defendant’s 22 Motion to Transfer. 23 1 C. This Court May Not Address the Arbitration Provision 2 Defendant contends that, in making purchases on Defendant’s website, Plaintiffs entered 3 into a valid arbitration agreement applicable to their claims in this action. (Arb. Mot.) Plaintiffs 4 disagree and further argue that arbitration agreements in place at various times differed

5 materially, and that the arbitration agreement is illusory. (Arb. Resp.) The Court may not address 6 these issues, however, because the forum selection provision takes precedence. 7 The forum selection provision here, titled “Governing Law and Disputes,” provides that 8 the “Terms will be governed by and construed under the substantive laws of the State of 9 Pennsylvania and you irrevocably submit to the exclusive jurisdiction of the federal and state 10 courts of the State of Pennsylvania.” (Schur Decl., Ex. D at 29.) 11 The arbitration clause is contained within a broader dispute resolution agreement 12 providing that all claims “will be resolved by this dispute resolution procedure and arbitration 13 agreement[.]” (Schur Decl., Ex. E at 32.) First, parties must “try in good faith to settle” disputes 14 informally by providing written notice and 30 days to respond. (Id.) Any remaining dispute

15 “shall be resolved through binding individual arbitration” on an individual basis conducted by 16 the American Arbitration Association. (Id. at 32-33.) The arbitrator shall determine the 17 arbitrability of any dispute. (Id. at 32.) However, a dispute may be brought as an individual 18 action in small claims court instead of arbitration. (Id.) The dispute resolution agreement “shall 19 be governed by, and interpreted, construed, and enforced in accordance with the Federal 20 Arbitration Act and, where applicable, the law of the Commonwealth of Pennsylvania.” (Id. at 21 33.) 22 The plain text of these provisions makes clear that the forum selection clause applies to 23 all disputes, while the arbitration clause applies only where informal resolution has failed and 1 small claims court is unavailable or not chosen by either party. Accordingly, the forum selection 2 clause mandates that Pennsylvania courts determine the applicability of the arbitration clause to 3 any particular dispute. The circumstances here are similar to Powell, where the defendant’s 4 “efforts to compel [the plaintiff] to arbitrate his claims fall within the scope of the Connecticut

5 forum selection clause.” Powell, 2019 WL 1489149, at *5. As in Powell, “transfer will effectuate 6 the parties’ contractual agreement to entrust a particular forum with ‘exclusive jurisdiction’ to 7 determine threshold issues of arbitrability.” Id., at *8. Accordingly, this Court declines to rule on 8 Defendant’s Motion to Compel Arbitration. 9 D. Motion to Certify Question 10 Plaintiffs move to certify to the Washington Supreme Court the question of whether “a 11 contract, including an arbitration agreement, is unenforceable as an illusory promise where it 12 allows one party to unilaterally modify the arbitration agreement without prior notice[.]” (Cert. 13 Mot. at 2.) Because the Court declines to rule on the enforceability of the arbitration provision, 14 the Court also declines to rule on Plaintiff’s Motion to Certify Question.

15 IV. CONCLUSION 16 For the foregoing reasons, the Court GRANTS Defendant’s Motion to Transfer (dkt. 17 # 16). The Clerk is directed to transfer this action to the Eastern District of Pennsylvania in 18 accordance with Local Civil Rule 3(i) and close this file. 19 The Court declines to rule on Defendant’s Motion to Compel Arbitration (dkt. # 18) and 20 Plaintiffs’ Motion to Certify Question (dkt. # 33). 21 Dated this 10th day of April, 2026. 22 A 23 MICHELLE L. PETERSON United States Magistrate Judge