Unreported / Non-Citable
Background
Steven Lomeli sued Whoop, Inc. on behalf of himself and a putative class in the U.S. District Court for the Northern District of California. He alleged that Whoop’s wearable device and related services collected health metrics and offered educational videos, but that the company shared consumers’ in-app activity, vitals, and video titles with an undisclosed third party without informing consumers or obtaining consent. The complaint asserted claims under the Video Privacy Protection Act and California’s Confidentiality of Medical Information Act. These were allegations underlying the motion, not findings that Whoop violated either statute.
Whoop moved to compel arbitration of every claim or, alternatively, to dismiss the complaint, and asked to stay the case pending arbitration. Its motion relied on terms in effect when Lomeli registered for a membership in August 2020 and updated terms posted on May 8, 2025. The earlier terms accepted future modifications through continued use, while the 2025 update added an arbitration provision with a 30-day opt-out procedure. Whoop sent two notice emails on May 24, 2025, with hyperlinks to the updated terms. The court identified undisputed evidence that Lomeli opened the second email on May 25, did not opt out within 30 days, kept his account active, and continued using the app.
The Court’s Holding
Judge Maxine M. Chesney granted the motion to compel arbitration and stayed the action pending completion of arbitration. Applying California contract-formation principles, the court required reasonably conspicuous notice and an unambiguous manifestation of assent. It found that the transaction context favored inquiry notice because Lomeli supplied an email address during registration and could expect relevant account updates there. The emails’ clear subject lines, legible content, and prominently displayed hyperlinks also supported notice. Although Whoop provided no other notices, that omission was not dispositive, and the emails did not have to mention every revision, including arbitration, specifically.
The court next found assent through conduct. Lomeli opened a notice email, did not timely opt out, and continued using Whoop; the order noted undisputed evidence that he uploaded data on at least 417 of 419 days between the terms’ effective date and the motion’s filing. His later attempt to opt out after an October 2025 update did not undo the earlier agreement because the later terms expressly preserved a prior arbitration agreement when no valid earlier opt-out occurred. The court distinguished Jackson v. Amazon.com because Whoop, unlike the defendant there, supplied the notice email and evidence of receipt. Finally, the agreement delegated disputes about arbitrability and enforceability to the arbitrator, so the court did not decide whether Lomeli’s claims fell within the agreement’s scope. Whoop’s alternative request for merits dismissal was denied as moot.
Key Takeaways
- Continued use of an app can manifest assent to updated terms when the user received reasonably conspicuous email notice and did not exercise a stated opt-out right.
- The court treated clear update emails with hyperlinks as sufficient notice even though the messages did not specifically mention the new arbitration provision.
- A later opt-out did not defeat arbitration where the governing terms stated that later changes did not create a new opportunity to reject an existing arbitration agreement.
- The delegation clause left scope and arbitrability questions for the arbitrator rather than the district court.
- The lawsuit was stayed for arbitration, and Whoop’s alternative request to dismiss the claims on the merits was denied as moot.
Why It Matters
The order applies inquiry-notice principles to a company’s effort to add arbitration through updated online terms rather than through the customer’s original registration. The decisive combination was notice tied to an active account, an opened email containing a link to the terms, failure to opt out, and extensive continued use. The court’s distinction of Jackson also shows the importance of producing the actual communication and evidence that the customer received it.
The ruling resolves the forum for Lomeli’s claims, not their merits. His statutory privacy allegations remain for arbitration, subject to the arbitrator’s authority under the delegation clause. The stay preserves the federal action while arbitration proceeds, and the denial of the alternative dismissal request as moot does not constitute a ruling sustaining or rejecting the underlying claims.