In Cody v. Jill Acquisition LLC, No. 25-937 (S.D. Cal. June 30, 2025), the Southern District of California declined to enforce a retail site’s terms of use and compel arbitration, holding that the plaintiff, who used guest checkout to place an online order at the retail clothing site, did not have adequate notice of the terms and the arbitration clause. This case should serve as a wake-up call for online entities to reexamine electronic contracting processes. It exemplifies how, even if a website’s visual design and its placement of the hyperlinked Terms of Use during user checkout are comparable to other presentations that have been deemed enforceable, a court could still decline to enforce online terms if the context of the transaction is not the typical e-commerce transaction between a registered customer and a retail site. In this case, the court found that by checking out as a guest without creating an account, the user was less likely to expect a continuing relationship and, therefore, the site’s notice and presentation of the terms below the “Place Order” button were not conspicuous enough in this instance to bind the plaintiff.