Buyers (and Sellers) on eBay Beware!

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Buyers (and Sellers) on eBay Beware! Arizona Appellate Court holds that clicking the “Buy it Now” button on Ebay creates a binding Contract.

On March 8, 2018, the Arizona Court of Appeals (Division One) determined two parties entered into a valid and enforceable contract when a Phoenix woman, Mrs. Julie Rohr (“Mrs. Rohr”), offered her diamond ring on eBay with the option for users to “Buy It Now”, and Mr. Evangelos Armiros (“Mr. Armiros”) accepted the offer by clicking the “Buy It Now” button. Armiros v. Rohr, 416 P.3d 864 (2018).

At issue was Ms. Rohr allegedly “backing” out of her original offer of selling her 10.17 -carat diamond ring for sale on E-bay to Mr. Armiros for $100,000 in 2014. After viewing the diamond’s listing, Mr. Armiros, a Georgia resident and sole owner of E-Diamond, LLC, contacted Mrs. Rohr, asking for a confirmation of the authenticity of the ring. After receiving the Gemological Institute of America report and agreeing to meet in Phoenix to consummate the transaction, Mr. Armiros clicked E-Bay’s “Buy it Now” button. That night, eBay closed the listing of the 10.17 carat ring.

After the listing was closed, Mrs. Rohr received an email from another buyer offering more money, or $150,000, to purchase the ring. Mrs. Rohr accepted the second (higher) offer and emailed Mr. Armiros a cancellation request thru E-Bay stating, “I made a mistake in my listing price”. After some limited discussion between the two, Mrs. Rohr did not agree to sell Mr. Armiros the ring and he subsequently brought suit in Maricopa County Superior Court to enforce the contract.

After the Superior Court granted summary judgment in favor of Mr. Armiros, holding that a binding contract existed between the parties, Mrs. Rohr appealed.

Making quick work of the facts behind the failed transaction, the Appellate Court affirmed the lower court’s decision. The three person panel found a valid contract existed the moment Mrs. Rohr listed the diamond ring on eBay with the option for users to “Buy it Now” and Mr. Armiros clicked the button, accepting her offer. The Appellate Court also affirmed the lower court’s finding that, although Mr. Armiros had not paid for the ring before Julie breached the contract, he was entitled to the benefit of the bargain and suffered damages.

Important to the Appellate Court’s decision was the fact the both parties agreed to be bound the eBay user agreement which discusses the various ways in which a buyer can acquire an item, either by bidding or clicking “Buy It Now.” Specifically, the Court of Appeals reasoned, “By posting the ring with the “Buy It Now” option, Julie (Mrs. Rohr) expressed her intention to enter into a contract with anyone that clicked the “Buy It Now” button. Likewise, Evangelos (Mr. Armiros) knew that by clicking the “Buy It Now” button he would obligate himself to purchase the ring according to the listing’s terms.” 416 P.3d at 869

Accordingly, online buyers (and sellers) take heed; Arizona courts will enforce the “Buy it Now” or similar features on online auction or vending sites. Although the Court of Appeals decision is rather unremarkable in its legal reasoning, the impact on the online vending community is significant.

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