Bragg v. Linden Research, Inc.

The case resulted in an important early ruling on the enforceability of an online End User License Agreement (EULA) under American contract law, though it did not ultimately gain influence as a precedent.

[1] Linden Lab (owned by the corporate entity Linden Research, Inc.), an online virtual world service provider known for the popular Second Life, terminated the account of user Marc Bragg when it discovered that Bragg had found a way to acquire land in the virtual world at a lower-than-market price by manipulating in-game auctions.

[1] Having thus determined that his court had jurisdiction, Robreno then denied Linden Lab's attempt to force the dispute into arbitration, finding that the EULA containing this requirement had been constructed as a contract of adhesion for which users like Bragg were given no opportunity to negotiate.

[10] Bragg had argued that the arbitration clause in the EULA was "both procedurally and substantively unconscionable and is itself evidence of defendants' scheme to deprive Plaintiff (and others) of both their money and their day in court.

[11] At the time of the district court ruling, some commentators believed that it could become an important precedent on arbitration clauses and other unconscionable provisions that are forced upon Internet users by the operators of online games and platforms.