Contracts Keyed to Calamari
Brower v. Gateway
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- Topic: Identifies the topic of law and where this case fits within your course outline.
- Parties: Identifies the cast of characters involved in the case.
- Procedural Posture & History: Shares the case history with how lower courts have ruled on the matter.
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- Brief Facts: A Synopsis of the Facts of the case.
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- Facts: What are the factual circumstances that gave rise to the civil or criminal case? What is the relationship of the Parties that are involved in the case. Review the Facts of this case here:
The Appellants/Plaintiffs, Brower and others (the "Plaintiffs"), were individuals that purchased computers and software products from the Defendant, Gateway 2000 (the "Defendant"), through a direct-sales system, by mail or telephone order. A copy of the Defendant's "Standard Terms and Conditions Agreement" (the "Agreement") and any relevant warranties were included with the shipment. The first part of the agreement included a "Note to the Customer". This note states, "in slightly larger print than the remainder of the document, in a box that spans the width of the page: 'This document contains Gateway 2000's Standard Terms and Conditions. By keeping your Gateway 2000 computer system beyond thirty (30) days after the date of delivery, you accept these Terms and Conditions.' " The agreement spanned sixteen paragraphs. Paragraph ten entitled "dispute resolution" is relevant here. It reads as follows: "Any dispute or controversy arising out of or relating to this Agreement or its interpretation shall be settled exclusively and finally by arbitration. The arbitration shall be conducted in accordance with the Rules of Conciliation and Arbitration of the International Chamber of Commerce. The arbitration shall be conducted in Chicago, Illinois, U.S.A. before a sole arbitrator. Any award rendered in any such arbitration proceeding shall be final and binding on each of the parties, and judgment may be entered thereon in a court of competent jurisdiction." • The Plaintiffs brought an action "alleging deceptive sales practices in seven causes of action, including breach of warranty, breach of contract, fraud and unfair trade practices." The Defendant moved to dismiss the Plaintiffs' complaint based on the existence of the Arbitration Clause in Paragraph ten. In response, the Plaintiffs argued that the arbitration clause was "invalid under UCC 2-207, unconscionable under UCC 2-302 and an unenforceable contract of adhesion." The Plaintiffs' major contentions were first that the forum for the arbitration was in Chicago and the headquarters of the arbitral body, the "International Chamber of Commerce" ("ICC") was located in France. Second, the arbitral body's rules were difficult to locate. Third, its costs were prohibitive (for claims less then $50,000, litigants had to advance fees of $4000, $2000 of which was non-refundable). Fourth, travel expenses would be incongruent to the amount sought. Fifth, if the Plaintiffs were to lose, they would have to pay the Defendant's legal fees. Thos amount of money was more than the cost of most of the Defendant's products.
- Issue(s): Lists the Questions of Law that are raised by the Facts of the case.
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