Salameno et al v. Gogo Inc. et al

Filing 34

MEMORANDUM, ORDER & JUDGMENT denying plaintiffs' #23 Cross-Motion to Strike; granting Gogo's #19 Motion to Compel Arbitration. The parties shall proceed to arbitrate their claims in accordance with the arbitration clause they agreed to. The case is otherwise dismissed. All other requests for relief in Gogo's motion are denied as moot. The clerk is directed to close the case. Ordered by Judge Jack B. Weinstein on 7/7/2016. (Barrett, C)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF NEW YORK
CHARLES SALAMENO, MARIA-ANGELA
SANZONE and JOHN JENSEN, on behalf of
themselves and all others similarly situated,

MEMORANDUM, ORDER
& JUDGMENT
16-CV-0487

Plaintiffs,
– against –

GOGO INC. and GOGO LLC,
Defendants.

Parties

Appearances

Charles Salameno
Maria-Angela Sanzone
John Jensen

Clifford Tucker
Fisher Injury Lawyers
6715 Perkins Road
Baton Rouge, LA 70808
Tel: [phone]
Fax: [phone]
[e-mail]

Gogo Inc.
Gogo LLC

Anthony Joseph Laura
Epstein Becker Green
250 Park Avenue
New York, NY 10177
[phone]
[e-mail]

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JACK B. WEINSTEIN, Senior United States District Judge:
Table of Contents
Introduction ............................................................................................................................. 2

I.

II. Plaintiffs’ Cross-Motion to Strike ........................................................................................... 3
III.

Facts ..................................................................................................................................... 5

A. Parties ................................................................................................................................... 5
B. Purchasing Gogo’s Product.................................................................................................. 6
C. Gogo’s Terms of Use ........................................................................................................... 9
IV.

Motion to Compel Arbitration ........................................................................................... 10

A. Law .................................................................................................................................... 10
B. Application of Law to Facts ............................................................................................... 11
1. Plaintiffs consented to the terms of use .......................................................................... 11
2. Plaintiffs’ claims fall within the arbitration clause ........................................................ 14
3. There are no non-arbitrable federal claims .................................................................... 15
V.

I.

Conclusion ............................................................................................................................ 15

Introduction
Defendants Gogo Inc. and Gogo LLC (collectively, “Gogo”) provide internet access on
airplanes. Plaintiffs Charles Salameno, Maria-Angela Sanzone, and John Jensen are dissatisfied
customers who repeatedly used Gogo’s product over a period of months or years. Plaintiffs
commenced this action, on behalf of themselves and all others similarly situated, alleging
violations of consumer protection statutes and making claims for breach of contract, fraud,
promissory estoppel, and unjust enrichment.
Gogo has moved to compel arbitration, transfer venue, or, alternatively, to dismiss the
complaint for failure to state a claim. Plaintiffs have cross-moved to strike an affidavit and
attachments that Gogo submitted with its moving papers.

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Gogo’s motion to compel arbitration is granted. The company’s terms of use bind
plaintiffs. Sophisticated business travelers who repeatedly purchased and used Gogo’s product
can be assumed to have been aware of the arbitration clause where they repeatedly ordered the
service.
Plaintiffs’ cross-motion to strike is denied. The type of information and evidence
provided in the affidavit and accompanying exhibits are appropriately considered on motions to
compel arbitration and to transfer. They are also appropriately considered on a motion to dismiss
because they are integral to plaintiffs’ claims.
II.

Plaintiffs’ Cross-Motion to Strike
In support of its motion, Gogo submitted the Declaration of Sara Rossio and three
exhibits. The exhibits are a picture of the account creation page on Gogo’s website and two
versions of Gogo’s terms of use. See Decl. of Sara Rossio, May 23, 2016, ECF No. 20 (“Rossio
Decl.”). Gogo submitted a second declaration with its reply papers, attaching a copy of an email that was sent to a customer confirming purchase of Gogo’s product. See Reply Decl. of
Sara Rossio, June 23, 2016, ECF No. 29 (“Rossio Reply Decl.”). The parties also produced at
the hearing, pursuant to the court’s order, a webpage screenshot of the webpage plaintiffs would
have seen when signing into their existing accounts. See Letter from Anthony J. Laura, June 29,
2016, ECF No. 32, at Exs. A-B.
Plaintiffs contend that because these materials are neither integral to the Amended
Complaint nor are subject to judicial notice, they cannot be considered on a motion to dismiss.
See Mem. of Law in Supp. of Pls.’ Cross-Mot. to Strike Certain Matters Outside the Pleadings or
in the Alternative to Treat Defs.’ Mot. as one for Summ. J., June 13, 2016, ECF No. 23-1 (“Mot.
to Strike”). They are wrong for two reasons.

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First, Gogo’s motion is not simply a motion to dismiss. It is also, alternatively, a motion
to compel arbitration and to transfer venue. Considering material outside the pleadings is not
only appropriate, but necessary on such motions. See Greenberg v. Ameriprise Fin. Servs., No.
15-CV-3589, 2016 WL 3526025, at *5 (E.D.N.Y. Mar. 31, 2016) (motion to compel arbitration);
Guida v. Home Sav. of Am., Inc., 793 F. Supp. 2d 611, 613 n. 2 (E.D.N.Y. 2011) (same);
Citibank, N.A. v. Affinity Processing Corp., 248 F. Supp. 2d 172, 176 (E.D.N.Y. 2003) (motion
to transfer venue); Flood v. Carlson Restaurants Inc., 94 F. Supp. 3d 572, 578 n. 4 (S.D.N.Y.
2015) (same).
Second, the materials Gogo submitted are integral to plaintiffs’ claims. Generally, on a
motion to dismiss for failure to state a claim, a court may consider only the factual allegations in
the complaint, evidence attached to or incorporated by reference in the complaint, judicially
noticeable matters, and documents in a plaintiff’s possession or of which a plaintiff had
knowledge and relied on in bringing suit. See Goel v. Bunge, Ltd., 820 F.3d 554, 559 (2d Cir.
2016); Nicosia v. Amazon.com, Inc., 84 F. Supp. 3d 142, 148 (E.D.N.Y. 2015) (quoting Brass v.
Am. Film Techs., Inc., 987 F.2d 142, 150 (2d Cir. 1993)).
An item of evidence “integral” to the complaint is properly considered on a motion to
dismiss. The Court of Appeals for the Second Circuit has explained that “[a] document is
integral to the complaint ‘where the complaint relies heavily upon its terms and effect.’” Goel,
820 F.3d at 559 (quoting Chambers v. Time Warner, Inc., 282 F.3d 147, 153 (2d Cir. 2002)).
Plaintiffs’ claims center on the terms of their contractual relationship with Gogo, and the
service Gogo was to provide pursuant to those terms. The contract itself – here the terms of use
– is “integral” to the complaint, and may be considered on a motion to dismiss. See, e.g., Broder
v. Cablevision Sys. Corp., 418 F.3d 187, 196 (2d Cir. 2005); Wilson v. Kellogg Co., 111 F. Supp.

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3d 306, 311 (E.D.N.Y. 2015), aff’d, 628 F. App’x 59 (2d Cir. 2016) (website terms and
conditions found integral to breach of contract case); Nicosia, 84 F. Supp. 3d at 148-49
(evaluating motion to dismiss in favor of arbitration under a 12(b)(6) standard, considering “a
copy of the final purchase screen Plaintiff viewed prior to making his purchases, as well as the
2012 Conditions of Use which were hyperlinked on that page,” as integral to plaintiff’s
complaint).
The exhibits Gogo submitted with its moving papers are appropriately considered on a
motion to compel arbitration, transfer venue, and dismiss. Plaintiffs’ cross-motion to strike is
denied.
III.

Facts
A.

Parties
Plaintiff Charles Salameno, formerly a resident of New York, was a resident of Ohio

when he brought this case. Am. Class Action Compl., May 2, 2016, ECF No. 14, at ¶ 14. He
purchased Gogo’s product on at least three occasions. Id. at ¶ 52. Maria-Angela Sanzone is a
resident of New York who purchased Gogo’s product approximately once per month for
approximately three years. Id. at ¶¶ 15, 56. John Jensen is a resident of Washington who, since
2011, paid for Gogo’s product at least 534 times. Id. at ¶¶ 16, 60.
Gogo Inc., a Delaware corporation, is the parent company of Gogo LLC. Id. at ¶ 17.
Gogo offers “a full suite of in-flight internet connectivity and other voice and data
communications products and services” to passengers on airplanes. Id. at ¶ 18 (citing Gogo
Inc., Form S-1 Registration Statement, Dec. 22, 2011 (available at http://1.usa.gov/1V2pATl)).
To access Gogo’s services, passengers can purchase subscription plans and internet passes. Id. at
¶ 20. Gogo provides its service on more than 2,000 commercial aircraft on more than 10 major
airlines. Id. at ¶ 19, Ex. A.
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B. Purchasing Gogo’s Product
In order to purchase Gogo’s service, a customer must follow a two-step process. First, he
or she must create an account on Gogo’s website. This step requires input of his or her name and
e-mail address, and creation of a password. Id. at ¶¶ 42-43. The user must then accept Gogo’s
privacy and cookie policy and terms of use. Rossio Decl. at ¶ 6. Screenshots of the account
creation pages as depicted on an aircraft passenger’s computer are duplicated below:

Am. Class Action Compl. at Ex. P.

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By clicking this button, you agree
to Gogo’s privacy & cookie policy
and terms of use.

Id. at Ex. Q (text box added).
Following the creation of the account, a customer can purchase a subscription or pass.
Gogo offers several different options, varying by duration of access and airline, to choose from.
Id. at ¶¶ 46-47, Exs. S-AB. According to plaintiffs, only four of Gogo’s ten products’ purchase
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screens include the statement “By clicking the button below, you understand and agree to these
terms and Gogo’s privacy & cookie policy and terms of use.” Id. at ¶ 47, Exs. Y-AB. Once a
subscription or pass is purchased, a confirmation e-mail is sent to the customer; the e-mail
includes a hyperlink to Gogo’s terms of use. Rossio Decl. at ¶ 19; Rossio Reply Decl. at Ex. 4.
Each time a purchaser returned to Gogo’s website to sign-in to his or her account, the
user would encounter a page with text that reads “By clicking ‘Sign In’ I agree to the terms of
use and privacy policy.” The phrase “terms of use” was hyperlinked, enabling the user to access
and review them prior to signing in. Rossio Decl. at ¶ 7. A screenshot of an example of the
sign-in page is recreated below:

By clicking this button, you agree
to Gogo’s privacy & cookie policy
and terms of use.

Letter from Anthony J. Laura, June 29, 2016, ECF No. 32, at Ex. B.
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C. Gogo’s Terms of Use
Gogo’s terms of use contain arbitration and forum selection clauses. After December
2012, these clauses were in the terms of use plaintiffs agreed to repeatedly. Rossio Decl. at ¶¶
11-12.
The arbitration clause requires that all disputes, except for those which can be brought to
a small claims court, be arbitrated under the rules of the American Arbitration Association:
You agree that the sole and exclusive forum and remedy for any
and all disputes and claims that cannot be resolved informally and
that relate in any way to or arise out of the Site, the Service or
these Terms and Conditions, shall be final and binding arbitration .
. . As a limited exception to the agreement to arbitrate, you and we
agree that you may take claims to small claims court, if your
claims qualify for hearing by such court.
Id. at Ex. 2, § 10; see also id. at Ex. 3, § 11. The arbitration clause also contains an opt-out
provision in capital letters:
YOU HAVE A RIGHT TO OPT-OUT OF THIS ARBITRATION
AGREEMENT. IF YOU DO NOT AGREE TO THIS
MANDATORY ARBITRATION PROVISION WITH REGARD
TO ANY PARTICULAR INTERACTION WITH THE SITE OR
THE SERVICE, THEN WITHIN THIRTY (30) DAYS FROM
THE DATE OF SUCH INTERACTION, YOU MAY OPT-OUT
OF THIS PART OF THE AGREEMENT BY EITHER CALLING
1-877-350-0038 OR BY SENDING AN EMAIL TO
[e-mail]. Any opt-out received after the thirty
(30) day time period will not be valid and you must pursue your
claim via arbitration pursuant to these Terms.
Rossio Decl. at Ex. 2, § 10; see also id. at Ex. 3, § 11.
The forum selection clause requires that any claim that is not resolved through arbitration
be resolved by a court in Chicago, Illinois:
The parties agree that any claim or dispute one party has against
the other party arising under or relating to this Agreement
(including claims in contact, tort, strict liability, statutory liability,
or other claims) that is not resolved under Section 10 of this
Agreement (Dispute Resolution / Arbitration) must be resolved
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exclusively by a court of competent jurisdiction, federal or state,
located in Chicago, Illinois, and no other court. Each party agrees
to submit to the personal jurisdiction of such courts and to accept
service of process from them.
Rossio Decl. at Ex. 2, § 12; see also id. at Ex. 3, § 13.
IV.

Motion to Compel Arbitration
A. Law
“The threshold question facing any court considering a motion to compel arbitration is . .
. whether the parties have indeed agreed to arbitrate.” Schnabel v. Trilegiant Corp., 697 F.3d
110, 118 (2d Cir. 2012). If such an agreement exists, the court must evaluate whether the claims
asserted fall within the agreement’s scope. If claims arising under federal law are asserted, the
court must also consider whether Congress intended those claims to be nonarbitrable. JLM

Indus., Inc. v. Stolt-Nielsen SA, 387 F.3d 163, 169 (2d Cir. 2004). Where an agreement exists,
asserted claims fall within the scope of the agreement, and there is no indication that Congress
intended any asserted federal claims to be nonarbitrable, the arbitration agreement should be
“rigorously enforce[d] . . . according to [its] terms.” Am. Exp. Co. v. Italian Colors Rest., 133 S.
Ct. 2304, 2309, 186 L. Ed. 2d 417 (2013).
There are differing views within the Second Circuit as to the appropriate standard to use
in performing this analysis. Some courts have held that “a standard similar to that applicable for
a motion for summary judgment” should be used, while others have applied a 12(b)(6) motion to
dismiss standard. Compare, e.g., Bensadoun v. Jobe-Riat, 316 F.3d 171, 175 (2d Cir. 2003)
(applying a summary judgment standard) with Nicosia, 84 F. Supp. 3d at 147 (applying a motion
to dismiss standard).
As a contract, an arbitration agreement requires an offer and a knowing acceptance.
“‘Mutual manifestation of assent’ is the ‘touchstone’ of a binding contract. A ‘transaction,’ even
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if created online, ‘in order to be a contract, requires a manifestation of agreement between the
parties’ as to its terms.” Berkson v. Gogo LLC, 97 F. Supp. 3d 359, 388 (E.D.N.Y. 2015)
(quoting Specht v. Netscape Commc’ns Corp., 306 F.3d 17, 29-30 (2d Cir. 2002)). In today’s
electronic world, online retailers often offer their services pursuant to terms of use shown on the
computer used to order a product or services. Manifestation of assent to a website’s terms of use
may be demonstrated in different ways. Some websites require assent by checking of a box or
clicking of a button – this is known as a “clickwrap agreement.” Berkson, 97 F. Supp. 3d at 397.
Other websites deem consent to be given when the user signs an account – this is known
as a ‘sign-in-wrap agreement.’ Id. at 399. Sign-in-wrap agreements have been found to be
enforceable in three circumstances, each of which emphasizes “an effective opportunity to access
terms and conditions:” first, “where the hyperlinked ‘terms and conditions’ is next to the only
button that will allow the user to continue use of the website;” second, “where the user ‘signed
up’ to the website with a clickwrap agreement and was presented with hyperlinks to the ‘terms of
use’ on subsequent visits; and third, “where notice of the hyperlinked ‘terms and conditions’ is
present on multiple successive webpages of the site.” Id. at 400-01.
B. Application of Law to Facts
Plaintiffs were repeatedly given adequate notice of the terms and conditions – including
the arbitration agreement. Their claims are within the scope of the arbitration agreement. There
is no indication that any of plaintiffs’ claims are non-arbitrable.
1. Plaintiffs consented to the terms of use
In order to purchase Gogo’s product, plaintiffs were presented with a webpage that
required them to click a button near the statement “By clicking this button, you agree to Gogo’s
privacy & cookie policy and terms of use.” See Am. Class Action Compl. at Exs. P & Q. The
“terms of use” were hyperlinked so that plaintiffs could review the terms before making their
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purchase. This constituted a clickwrap agreement. Then, each time plaintiffs signed-in to use
Gogo’s product, they were again presented with a webpage that contained the terms of use
hyperlink. This constituted a sign-in-wrap agreement. Rossio Decl. at ¶ 7. Additionally, upon
purchase, plaintiffs were sent a confirmation e-mail that also contained a hyperlink to Gogo’s
terms of use. Id. at ¶ 19; Rossio Reply Decl. at Ex. 4. Similar combinations of clickwrap and
sign-in-wrap agreements are enforceable. See Berkson, 97 F. Supp. 3d at 400-01.
Plaintiffs argue that these agreements are not enforceable because they were never
provided with adequate notice of the terms of use, and thus never consented to the provisions
contained within them. They contend that the “terms of use” hyperlink was inconspicuous, with
nothing being done by Gogo to specifically draw their attention to the link. See Pls.’ Mem. of
Law in Opp’n to Defs.’ Mot. to Compel Arbitration, Transfer Venue or, in the alternative, to
Dismiss the Am. Class Action Compl., June 13, 2016, ECF No. 22 (“Opp’n Br.”), at 14-21.
In support of their argument, plaintiffs rely heavily on this court’s decision in a prior case
involving Gogo. See id. (citing Berkson, 97 F. Supp. 3d at 403). In that case, the court found
that the arbitration clause in Gogo’s terms of use was an unenforceable contract of adhesion. See
Berkson, 97 F. Supp. 3d at 403-04. The court denied Gogo’s motion to compel arbitration or
transfer venue because, it held, “[n]either [plaintiff] can, at this stage of the litigation, be
considered to have knowingly bound [himself] to the purported terms of an agreement adverse to
them.” Id. at 405.
The facts in Berkson are distinguishable from the facts in the instant case. In Berkson,
the plaintiffs had only signed-up and used Gogo’s product a single time. Id. at 370, 373.
Additionally, when at least one of the plaintiffs signed-up for Gogo’s product, he did not receive
a confirmation e-mail containing a hyperlink to the terms of use. Id. at 370. Thus, the plaintiffs

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in Berkson would probably have seen the terms of use hyperlink only once or a few times. After
the court made its finding in Berkson, “the parties submitted convincing evidence” that plaintiffs,
and others who used Gogo’s product, were generally “sophisticated business persons,” rather
than average individuals. Berkson v. Gogo LLC, 147 F. Supp. 3d 123, 2015 WL 7960042, at *6
(E.D.N.Y. Dec. 4, 2015).
In contrast to the Berkson plaintiffs, the plaintiffs in the instant case purchased and used
Gogo’s product many more times. See Am. Class Action Compl. at ¶¶ 52, 56, 60. Each time the
plaintiffs purchased the product they were presented with a website containing the hyperlink to
the terms of use, and received an e-mail containing the same link. See id. at Exs. P & Q; Rossio
Decl. at ¶ 19; Rossio Reply Decl. at Ex. 4. Then, each time they signed-in to use the product,
they were again presented with the terms of use hyperlink. Letter from Anthony J. Laura, June
29, 2016, ECF No. 32, at Exs. A-B. Thus, unlike the plaintiffs in Berkson, the plaintiffs here
were repeatedly warned that by using Gogo’s product they were agreeing to the terms of use, and
they were repeatedly presented with a hyperlink to those terms.
Moreover, as practiced individuals who frequently flew with an apparent need for
internet access, it is reasonable to conclude that they are not unsophisticated lay internet users.
In today’s technologically driven society, it is reasonable to charge experienced users – as
plaintiffs appear to be – with knowledge of how hyperlinks work and, by extension, how to
access the terms of use they were – repeatedly – being told they were consenting to when they
signed-in to Gogo’s website.
The Court of Appeals for the Second Circuit’s recent decision in Starkey v. G Adventures,
Inc., 796 F.3d 193 (2d Cir. 2015), undercuts plaintiffs’ position. In Starkey, the plaintiff
purchased a vacation package from the defendant. Shortly after purchase, the defendant sent

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plaintiff three e-mails, each of which provided hyperlinks to defendant’s terms and conditions
and included statements to the effect of ‘all passengers must agree to the following terms and
conditions.’ Starkey, 796 F.3d at 195. The terms and conditions included a forum selection
clause, the central issue in that case.
The Court of Appeals held that the statements and hyperlinks in the three e-mails were
sufficient to put the plaintiff on notice of the terms and conditions – and thus the forum selection
clause – she was agreeing to by going on the vacation. Id. at 197. Although one of the e-mails
had the phrase “terms and conditions” in bolded, all capital letters, the Court of Appeals did not
indicate that such a presentation was necessary to its holding. See id. Significantly, the court
noted that the “case would have been simpler to resolve” had a clickwrap agreement been used to
acquire assent. Id. at 197 n. 3.
Here, not only did plaintiffs have an e-mail referring them to Gogo’s terms of use, but
they also – repeatedly – entered into clickwrap agreements and sign-in-wrap agreements. That
Gogo did not use bold font or all capital letters is not dispositive in the special circumstances of
this case. In the instant circumstances, it is reasonable to hold that plaintiffs had knowledge of
and provided consent to Gogo’s terms of use and the arbitration clause.
2. Plaintiffs’ claims fall within the arbitration clause
The arbitration clause in the terms of use encompasses “any and all disputes and claims . .
. that relate in any way to or arise out of the Site, the Service or these Terms and Conditions.”
Rossio Decl. at Ex. 2, § 10. Gogo argues that plaintiffs’ claims plainly fall within the scope of
the broad arbitration clause, a point on which plaintiffs offer no opposition. See Defs.’ Mem. of
Law in Supp. of their Mot. to Compel Arbitration, Transfer Venue or, in the alternative, to
Dismiss the Am. Class Action Compl., May 23, 2016, ECF No. 21, at 17-18.

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Plaintiffs' allegations center around the performance and operation of Go go's service.

See, e.g., Am. Class Action Compl. at irir 4-6. These allegations are within the scope of the broad
arbitration clause included in the terms of use that plaintiffs agreed to.

3. There are no non-arbitrable federal claims
The final step in evaluating a motion to compel arbitration is to determine whether any of
plaintiffs' claims are federal claims which the statute made non-arbitrable. Here, plaintiffs have
not asserted any claims arising under federal law, obviating this step of the analysis. See,

generally, Am. Class Action Compl.

V.

Conclusion
The sophisticated plaintiffs were repeatedly informed that by using Gogo's product they
were agreeing to Gogo's terms of use. They received this notice each time they purchased
Go go's product and each time they signed in to use it. Plaintiffs cannot now claim that they
were unaware of those terms. They are bound by the broad arbitration clause contained within
the terms of use.
Go go's motion to compel arbitration is granted. The parties shall proceed to arbitrate
their claims in accordance with the arbitration clause they agreed to.
The case is otherwise dismissed. All other requests for relief in Go go's motion are
denied as moot. The clerk is directed to close the case.
SO ORDERED.

Senior United States District Judge
Dated: July 7, 2016
Brooklyn, New York

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