News-on-the-Net is an online news service that sends email summaries of news stories to subscribers. In order to subscribe, a person must view the News-on-the- Net web page, click on subscription and enter their personal details. The service charges a small monthly fee, but it is mostly paid for by third party advertisers. At the bottom of the web page, there is a link to a page entitled Terms of Use. There is a also a space to indicate that the subscriber has read and agreed to the Terms of Use, although it is not actually necessary to link to the Terms of Use.

The Terms of Use is a document that contains numerous terms regarding copyright matters, cancellation procedures, a privacy policy and more. Also included is an exclusion clause that states that the subscribers can not hold News-on-the-Net liable for any possible damages that the site may cause to the subscriber. The exclusion clause was in bold red font.

When Scott subscribed, he did link to and review the terms in some detail, including some that were in a bold font, but he did not read the exclusion clause.

Due to a problem with their virus detection software, News-on-the-Net sent a computer virus to all of its subscribers that reviewed a particular news article. The virus disabled Scott's computer and caused him to miss an important contract deadline, for which he paid a penalty.

Scott sues News-on-the-Net for recovery of histloss. News-on-the-Net relies on the exclusion clause to excuse themselves from liability.

a. Who will be successful and briefly explain why. b. Would your answer be different if the virus originated from one of the advertisers on the News-on-the-Net feed? c. Finally, what if it was revealed that News-on-the-Net had been aware for several months before they offered their news service that they had a problem with their virus detection software?