By Benjamin Keep

Everyone wants you to click “agree.” This has got to be the 15th time I’ve updated iTunes; each time, I’m greeted by the ubiquitous end user license agreement (EULA) and each time I scroll quickly to the bottom to click “agree” without reading the theretos and the wherefores and the hereins. Contract readability may have improved since the Marx Brothers famously parodied it (“The party of the first part shall be known in this contract as the party of the first part”), but contract language remains obscure.

Of course, ignoring these lengthy license agreements is entirely rational. The likelihood of a litigation-worthy dispute arising from the contract is astronomically low. The average consumer is similarly unlikely to understand the contract, much less realize the full ramifications of the disclaimers and warranties. Furthermore, EULAs are largely the same.

Virtually every agreement disclaims all implied warranties, including warranties of merchantability (guaranteeing that a product is fit for the general purpose for which the product is sold). Almost all agreements demand arbitration, where costs and settlements are lower than in courts of law. For software in particular, “we care about your privacy” generally means “we will take as much private information from you as is legally permissible.” Most include clauses reserving the right to terminate service at any time for any reason whatsoever.

Even if a consumer did meticulously read the contract, and there were significant differences between the contracts of two competitors, will she make a buying decision because Apple resolves disputes through arbitration based on the laws of California, and Microsoft resolves disputes through arbitration based on the laws of Washington? No. So what’s the point?

Generally the law of contract is based on the idea of mutual assent but, in the EULA context, consumers who do bring suit are bound by terms they never read. Courts have typically enforced an agreement when the seller presents it to the consumer directly, and gives the consumer sufficient opportunity to read it before making a final purchase decision. After all, EULAs grease the market skids, as it were: They make buying and selling efficient, and allow price discrimination. Courts, by and large, pay little attention to whether or not users actually read the agreement in question, but more importantly, they pay little attention to the lack of incentives users have for taking the time to read an agreement in the first place. It is enough that the consumer had the chance to read the boilerplate — consumers are bound by that opportunity. This solution solves the efficiency problem, it permits business interactions to run smoothly, but it fails to solve the transparency problem: consumers don’t know the content of contracts that they agree to.

This solution favors freedom of contract over transparency — but freedom for whom? Consumers aren’t free — only companies are free to choose the terms that suit them. Of course, courts often impose measures of reasonableness to limit the power sellers have: Apple can’t force you to give up your firstborn child. But many of the clauses that sellers include border on the absurd. In 2006, MySpace’s agreement forced users to grant to MySpace the right to every song uploaded. iTunes’ EULA famously made users agree to “not use these products … for the development, design, manufacture or production of missiles, or nuclear, chemical or biological weapons.”

Sellers choose specific clauses for a reason. It’s no surprise the most commonly disputed clauses are arbitration clauses specifying the choice-of-law. Companies can limit their liability, eliminate the public exposure of disputes and increase the probability of success on the merits.

Of course, the arguments courts use to justify this solution are the same arguments consumers use to justify not reading the boilerplate in the first place. It’s just too inefficient to have cashiers at every store, or voices on every computer, repeating every clause of the contract in question. It wouldn’t make any difference anyway — consumers wouldn’t care.

For their part, companies have only a few weak motivations for developing consumer-friendly EULAs. There are doctrines of legal constraint, like unconscionability, which restrict extremely abusive terms; competition, which has little force when the agreements don’t influence purchasing choices; and finally, altruism, which I mention only for the sake of completeness. On the other hand, their motivations for presenting comprehensive and unreadable agreements are legion.

Is there a way to incentivize consumers to read the contracts that bind them without needlessly complicating business transactions? Must we rely on fictions to keep business running smoothly? Nutritional labels offer one model. Not everyone scrutinizes the ratio of fat to carbohydrates in every gram of food they eat, but information is laid out clearly, and comparisons between products are plain. Perhaps wresting power away from sellers would simply translate into higher costs for every consumer, as sellers adjust prices to deal with litigation costs. I would still prefer a system that motivates people to do what we expect them to do, rather than a system that expects them to do what we know they won’t.

In the meantime, just click “agree.”

Benjamin Keep law is a second-year student in the Law School and an associate on the Cornell International Law Journal. Barely Legal appears alternate Mondays