Author: Julie Kane
Conference America, Inc., an Alabama corporation, contracted with Conexant Systems, Inc., a Delaware corporation operating in California, to provide Conexant’s telephonic and internet-based conference and communications services. Conexant maintained multiple accounts with Conference America under a services agreement. The agreement, governed by California law, provided conferencing services to Conexant at a reduced, bulk rate.
Conference America sent a letter to Conexant terminating the agreement effective after a fifteen-day grace period. The termination letter specified that any services used or requested after termination would be available subject to Conference America’s standard operating agreement, available on their website. Conexant responded after the grace period had expired by requesting that no new accounts be created and requesting the cancellation of its many accounts after another fifteen days had passed.
Conference America’s website stated that “[a]dditional services are available at Conference America’s Standard Prices effective at the time services are rendered,” including a deactivation fee for each account. Conference America deactivated all the accounts as requested. However, when Conference America sent Conexant a bill for the deactivations and other conferencing services incurred during the post-termination time period, Conexant refused to pay, alleging that the services agreement governed these transactions.
The parties filed cross-motions for summary judgment. The issue presented “is whether the post-termination transactions were governed by the written services agreement, by a contract or series of contract under the … website terms and conditions, or by some other course of dealings resulting in a contract between the parties.”
The court found that the services requested by Conexant during the post-termination time period, including the account terminations, followed by Conference America’s acceptance and performance, constituted a series of contacts governed by the website terms and conditions at the time of request.
Conference America validly terminated its services, and informed Conexant several times that the terms of any services provided after the termination date would be governed by the website terms and conditions. Conexant claimed that the post-termination activities fell within the terms and conditions of the services agreement. However, “there [was] no suggestion of survivability in the [services] agreement as to the [] accounts and discounted pricing.”
Internal Conexant communication and language in the services agreement showed that Conexant was aware that Conference America’s website terms and conditions governed after the termination of the services agreement. Accordingly, the court held that a series of unilateral contracts were created when Conexant requested the accounts be terminated. “Conexant’s request was an offer, which Conference America accepted by its performance.” However, the communication between Conexant and Conference America in which Conexant requested the termination and Conference America confirmed also created a valid bilateral contract.
The court suggested using survivability clauses to avoid website terms and conditions governing certain aspects of the services provided post-termination, and suggested that an attempt by Conexant to revoke any post-termination agreement might have been valid if Conexant had ensured that Conference America received the revocation before performance.