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Washington Considering Allowing Consumers The Right To Cancel Contracts Over The Internet

Proposal would require online merchants to change the way they do business.

The State of Washington, already well-known for its aggressive pro-consumer protection statutes, is considering new legislation that would allow many consumers to cancel contracts via the Internet.  A bill was introduced to the Washington legislature on January 9, 2015 which would provide that if a consumer can enter into a contract for goods or services through the Internet and the contract allows the consumer to terminate, then the person offering the contract must provide the consumer with the ability to terminate through the same means by which the consumer had the option of entering into the contract. Thus, if the proposal becomes law, Washington consumers would have the option to cancel contracts over the Internet if they had the option to enter the contract over the Internet. Public hearings to discuss the proposal are being conducted on January 20th.

The proposal, which has not yet been voted on, would entitle any consumer injured by a violation to recover at least $1000 plus attorneys’ fees.  Such a provision would likely create a new feeding frenzy of class action lawsuits, which are already abundant in Washington. Already in place in Washington are some of the strictest statutes in the nation regarding commercial e-mail and unsolicited phone calls and text messages.

Takeaway:  This proposed law could be the start of a nationwide movement towards permitting online cancellation of consumer contracts.  It is a development that bears watching because it might require business to significantly modify their plans and require an investment in technology that would enable such cancellations.