Pierce, N. v. Empower Finance Inc.

J-A02006-26

                                   2026 PA Super 91

  NATALIE PIERCE, INDIVIDUALLY                 :   IN THE SUPERIOR COURT OF
  AND ON BEHALF OF ALL OTHERS                  :        PENNSYLVANIA
  SIMILARLY SITUATED                           :
                                               :
                                               :
                v.                             :
                                               :
                                               :
  EMPOWER FINANCE INC.                         :   No. 609 WDA 2025
                                               :
                       Appellant               :

                  Appeal from the Order Entered April 17, 2025
               In the Court of Common Pleas of Allegheny County
                       Civil Division at No: GD 24-012584


BEFORE: STABILE, J., MURRAY, J., and BECK, J.

OPINION BY STABILE, J.:                            FILED: May 1, 2026

       Appellant, Empower Finance Inc. (Empower), seeks review of an order

of the Court of Common Pleas of Allegheny County (trial court), overruling

preliminary objections to compel arbitration, the terms of which were included

in an online “browsewrap” agreement.1 We affirm.

       Empower is a technology company which offers immediate cash

advances of up to $300 through a smartphone app.                See Complaint,

11/5/2024, at para. 12-13. Subscribers must download the app, link the app


____________________________________________


 1 A “browsewrap” agreement is a type of contract in which a website offers

terms that are disclosed only through a hyperlink to which the user
purportedly manifests assent to those terms simply by continuing to use the
website. Berman v. Freedom Fin. Network, LLC, 30 F.4th 849, 855-56
(U.S. 9th Cir. 2022); see also Duffy v. Tatum, No. 483 EDA 2025, at *7
(Pa. Super. filed March 3, 2026) (describing various forms of online consumer
contracts, including “browsewrap,” “clickwrap,” “scrollwrap,” and “sign-in
wrap”).
J-A02006-26



to the subscriber’s bank account and then agree to Empower’s terms of

service. See id. The principal of the cash advance, and attendant fees, are

later debited by Empower from the linked bank account as soon as the

subscriber’s paycheck has been deposited. See id.

       In November 2024, Appellee, Natalie Pierce (Pierce), individually and on

behalf of all others similarly situated, filed a putative class action complaint

against Empower.        Pierce alleged that she had personally paid “an $8.00

express fee and an $8.00 monthly fee to obtain a $250.00 advance, which

was to be repaid within ten days, which yielded a 234% APR.” Id, at para.

26. According to Pierce, both she and other members of her putative class

were charged amounts of loan interest which exceeded the rates permitted by

the Pennsylvania Loan Interest and Protection Law (41 P.S. §§ 1-605), as well

as the Consumer Discount Company Act (7 P.S. §§ 6201-6219). See id., at

paras. 40-47.

       Empower timely filed preliminary objections, seeking to compel

alternative dispute resolution based on the Arbitration Agreement disclosed to

subscribers when an Empower account is created.               See Preliminary

Objections, 1/24/2025, at paras. 10-17.2 The process of creating an Empower

account, and assenting to the Arbitration Agreement, was described by

Empower as follows:
____________________________________________


 2 Pa.R.Civ.P. 1028(a)(6) provides that any party to any pleading may file
preliminary objections based on the existence of an “agreement for alternative
dispute resolution.”


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      11. To access the Empower application, users first need to
      download the app and open it on their mobile phone. Users then
      enter their phone number to sign up. A one-time 6-digit passcode
      is then texted to the user so that the user can authenticate his or
      her identity.

      12. For users (including Pierce) who signed up for their Empower
      accounts before August 2023, prior to entering this one-time 6-
      digit code, the users were shown the following directly below
      where they enter the code: “You agree to our Privacy Policy,
      Terms, E-Sign, & Subscription Agreement.”

      13. Each of these underlined statements includes a hyperlink that
      directs users to those terms and polices. The user was then
      prompted to create an Empower account, including their name,
      email, birth date, and additional information about themselves.

      14. The Terms inform the user on the very first page in bold
      letters: “Please note that these Terms contain an Arbitration
      Agreement at the end under ‘Dispute Resolution by Binding
      Arbitration.’ Please read the Arbitration Agreement
      carefully as it requires you to resolve disputes with us
      through binding arbitration.”

Id., at paras 11-14 (internal citations and graphics omitted, emphasis in

original).

      The Arbitration Agreement referred to in the “Terms” purports to obtain

the subscriber’s waiver of the right to a jury trial, as well as the right to

participate in a class action, in the event of any claim or dispute arising

between the subscriber and Empower:

      You agree that any and all disputes or claims that have arising or
      may arise between you and Empower, whether arising out of or
      relating to these Terms (including any alleged breach), our
      Services, any advertising, any aspects of the relationship, or
      transactions between us, will be resolved exclusively through final
      and binding arbitration, rather than a court, in accordance with
      the terms of this Arbitration Agreement, except that you may
      assert individual claims in small claims court, if your claims


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     qualify. . . . You agree that, by entering into these Terms,
     you and Empower are each waiving the right to a trial by
     jury or to participate in a class action. Your rights will be
     determined by a neutral arbitrator, not by a jury or jury.
     The Federal Arbitration Act governs the interpretation and
     enforcement of this Arbitration Agreement.

Id., at Exhibit 2, p. 12 (emphasis added).

     These arbitration terms became accessible to the subscriber on the fifth

of over 20 screens that had to be completed to finalize the registration

process. A subscriber would have to click on the hyperlinked term, “Terms,”




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in order to do so. The fourth and fifth screens, shown in the graphic below,

require confirmation of the subscriber’s telephone number:

       The left side of the above graphic (fourth screen in the registration

process) required a subscriber to input a phone number.              A six-digit

confirmation code is then sent to that phone number, leading to the right side

of the above graphic (fifth screen in the registration process), which required

the subscriber to input the code. See id.

       In the center of the latter (fifth) screen was the sentence, “You agree to

our Privacy Policy, Terms, E-Sign & Subscription Agreement.” Id. (underlines

in original, demonstrative arrow graphic added). Each of the underlined terms

in that sentence were hyperlinked to their corresponding contract provisions.

Of relevance here, and as noted above, “Terms” was hyperlinked to the

Arbitration Agreement which purported to obtain a subscriber’s consent to

waive the right to a jury trial and a class action suit. See id. A subscriber

would not need to click on any of the hyperlinks to advance to the following

screens of the registration process, or to complete the registration. The sixth

screen would appear as soon as the correct confirmation code was entered by

the subscriber on the fifth screen.

       Based on this overall web design,3 Empower argued that Pierce had

received sufficient notice of the Arbitration Agreement during the registration

process to give meaningful (and binding) assent to the Arbitration Agreement.
____________________________________________


 3 The parties’ dispute here does not concern the language of the Arbitration

Agreement itself.

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See Empower’s Brief in Support of Preliminary Objections, 1/24/2025, at 9-

14. That is, Empower asserted that it satisfied the objective inquiry in federal

and Pennsylvania law as to whether a reasonable internet user in Pierce’s

position (a) received notice of the agreement to arbitrate and (b) manifested

unambiguous assent to the waiver of the right to a jury trial. See id., at 14.

      Further, Empower recognized that its Arbitration Agreement would likely

not pass muster under this Court’s then-controlling en banc decision in

Chilutti v. Uber Technologies, Inc, 300 A.3d 430 (Pa. Super. 2023) (en

banc) (Chilutti I). See id., at 15. We held in Chilutti I that, for the waiver

of a jury trial in an online app to be enforceable, the “unambiguous

manifestation of assent to arbitration” in a “browsewrap” agreement must be

demonstrated by:

      (1) explicitly stating on the registration websites and application
      screens that a consumer is waiving a right to a jury trial when
      they agree to the company's “terms and conditions,” and the
      registration process cannot be completed until the consumer is
      fully informed of that waiver; and (2) when the agreements are
      available for viewing after a user has clicked on the hyperlink, the
      waiver should not be hidden in the “terms and conditions”
      provision but should appear at the top of the first page in bold,
      capitalized text.

Chilutti I, 300 A.3d at 450.

      The Chilutti I Court adopted its standard in recognition of this

Commonwealth’s aim of affording “the constitutional right to a jury trial . . .

the greatest protection[.]” Id., at 449. The arguably less stringent federal

test was eschewed by the Chilutti I Court because, under Pennsylvania law,



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“a stricter burden of proof is necessary to demonstrate a party’s unambiguous

manifestation of assent to arbitration.” Id., at 449-50.

      Empower urged the trial court not to apply Chilutti I because, at the

time its preliminary objections were filed, the opinion was pending review

before the Pennsylvania Supreme Court and Empower anticipated that the

opinion was likely to be preempted by federal law. See Empower’s Brief in

Support of Preliminary Objections, 1/24/2025, at 15-18.

      Pierce filed an opposition to Empower’s preliminary objections. Citing

Chilutti I, she argued that the arbitration provisions were not valid because

Empower’s registration included no express waiver language stating that the

constitutional right to a jury trial was being waived, and the waiver provisions

themselves were not conspicuously presented. She emphasized further that

the arbitration provisions were, essentially, buried within Empower’s

registration process, and that it was not clear from the app’s web design

whether simply inputting a confirmation code would manifest assent to the

arbitration provisions accessible through the “Terms” hyperlink to Empower’s

browsewrap agreement.        See Memorandum of Law in Opposition to

Empower’s Preliminary Objections, 2/6/2025, at 9-14.

      Empower filed a reply to Pierce’s opposition, again stressing that the

arbitration terms were reasonably visible, or conspicuous, to its subscribers.

See Reply to Opposition to Preliminary Objections, 4/10/2025, at 2-6.

Empower reiterated that Chilutti I would likely be preempted because this




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Court’s opinion had adopted a “stricter burden of proof” for demonstrating

assent to arbitration than the standard applied in federal law. See id, at 7-8.

      After oral argument on Empower’s preliminary objections, they were

overruled, as the trial court found that Pierce had not waived the right to a

jury trial, and that arbitration could not be compelled. Empower then filed a

timely notice of appeal. See Pa.R.A.P. 311(a)(8) (stating that an appeal may

be taken as of right from “[a]n order that is made final or appealable by statute

or general rule, even though the order does not dispose of all claims and of

all parties”); MacPherson v. Magee Memorial Hosp. for Convalescence,

128 A.3d 1209, 1213 n.4 (Pa. Super. 2015) (en banc) (“An order refusing to

compel a case to arbitration is a threshold, jurisdictional question, that is

appealable as an exception to the general rule that an order overruling

preliminary objections is interlocutory and not appealable as of right.”)

(citations omitted).

      In its 1925(a) opinion, giving the reasons why its order should be

affirmed, the trial court applied the rationale and holding of Chilutti I to

conclude   that   the   subject   provisions   requiring   arbitration   were   not

enforceable:

      [Empower] is correct that I primarily relied on [Chilutti I] to
      reach my decision as [Chilutti I] is the current controlling caselaw
      regarding the enforceability of "browsewrap" agreements in
      Pennsylvania. When terms and conditions to which a company
      wishes to bind a website or app user are available by clicking on
      a hyperlink, "a web designer must do more than simply
      underscore the hyperlinked text in order to ensure that it is
      sufficiently "set apart" from the surrounding text." [Chilutti I,


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     300 A.3d at 448 (citing Berman v. Freedom Fin. Network, LLC,
     30 F.4th 849, 856-57 (U.S. 9th Cir. 2022))].

     Here, [Empower] merely underscored [“Terms”] and did not
     utilize any other customary design elements to ensure that the
     hyperlinks were conspicuous to the user. More importantly,
     however, is [Empower’s] failure to ensure that the user
     "unambiguously manifested their assent to be bound by the terms
     and conditions."

     [Empower] argues that by entering the confirmation code on the
     same page as the hyperlinks to the terms, a user affirmatively
     assents to waive their right to a jury trial and be bound to the
     arbitration clause (among other terms and conditions).
     [Chilutti I] emphasizes the importance of ensuring that a user
     has "unambiguously manifested their assent to be bound by the
     terms and conditions," citing Berman that a "user's click of a
     button can be construed as an unambiguous manifestation of
     assent only if the user is explicitly advised that the act of clicking
     will constitute assent to the terms and conditions of an
     agreement." [Chilutti I, 300 A.3d at 448 (citing Berman, 30
     F.4th at 857-58)].

     [Empower’s] registration process clearly fails this, as it does not
     even meet the minimum remedy suggested in Berman of
     including language such as "by clicking the . . . button, you agree
     to the terms and conditions." It is a leap to argue that a
     reasonably prudent interne user would assume that inputting the
     numbers of a continuation code affirmatively binds them to an
     arbitration agreement, simply because the numbers are entered
     on the same screen where the hyperlinks to the terms and
     conditions are provided. Even if [Empower] had met this minimum
     degree of notice, [Chilutti I] has determined that Pennsylvania
     wants to go further to protect a user's right to a jury trial by
     establishing a two-part test:

           1) explicitly stating on the registration website and
           application screens that a consumer is waiving a right
           to a jury trial when they agree to the company's
           "terms and conditions," and the registration process
           cannot be completed until the consumer is fully
           informed of that waiver, and 2) when the agreements
           are available for viewing after a user has clicked on
           the hyperlink, the waiver should not be hidden in the

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J-A02006-26


            "terms and conditions" provision but should appear at
            the top of the first page in bold, capitalized text.

      Id. at 450.

      In addition to lacking an affirmative way to manifest assent and
      failing to sufficiently set apart the hyperlink text, [Empower] failed
      to state on the registration and application screen that a user was
      agreeing to be bound by an arbitration clause. Therefore,
      [Empower] fails the first prong of the test in [Chilutti I].

Trial Court 1925(a) Opinion, 7/10/2025, at 3-5 (indentations added, some

internal citations omitted).

      Empower now raises a single issue in its appellate brief – “Whether the

trial court erred when it held that Pierce and Empower did not form an

agreement to arbitrate, and therefore erred in overruling Empower’s

Preliminary Objections seeking to compel arbitration.” Appellant’s Brief, at 6.

      “An order denying a petition to compel arbitration is an interlocutory

order appealable as of right.” Fineman, Krekstein & Harris, P.C. v. Perr,

278 A.3d 385, 389 (Pa. Super. 2022) (citation omitted); see also 42

Pa.C.S.A. § 7320(a)(1) (stating that an appeal may be taken from “[a] court

order denying an application to compel arbitration made under section 7304

(relating to proceedings to compel or stay arbitration.”).          “Whether an

agreement to arbitrate disputes exists is a question of law.”       Neuhard v.

Travelers Ins. Co., 831 A.2d 602, 604 (Pa. Super. 2003). “When we review

questions of law, our standard of review is limited to determining whether the

trial court committed an error of law.”       Id.   An arbitration agreement is

enforceable under Pennsylvania law if it satisfies a two-part test: “The first


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determination is whether a valid agreement to arbitrate exists. The second

determination is whether the dispute is within the scope of the agreement.”

Smay v. E.R. Stuebner, Inc., 864 A.2d 1266, 1270 (Pa. Super. 2004).

      In the present matter, it is undisputed that the arbitration provision in

Empower’s browsewrap agreement is unenforceable under the first prong of

the test adopted in Chilutti I. An en banc panel of this Court held in that

case that a browsewrap agreement, like the one used by Empower, may only

be enforced if it is “explicitly” stated on the application screens that, by

agreeing to the company’s terms and conditions, the “consumer is waiving a

right to a jury trial.” Chilutti I, 300 A.3d at 450.

      As the trial court noted, Empower’s online application lacked “an

affirmative way to manifest assent” to the waiver of the right to a jury trial,

did not “sufficiently set apart the hyperlink text” containing the arbitration

agreement, and did not “state on the registration and application screen that

a user was agreeing to be bound by an arbitration clause.” Trial Court 1925(a)

Opinion, 7/9/2025 at 5.

      However, Empower’s inability to satisfy the first prong of the Chilutti I

is not alone dispositive. Our Supreme Court vacated that opinion and quashed

the appeal upon finding that the order on review (granting a petition to compel

arbitration and staying court proceedings) did not qualify as an immediately

reviewable collateral order. See Chilutti v. Uber Tech., Inc., 349 A.3d 826,

834-35 (Pa. 2026) (Chilutti II).      Chilutti I, by itself, therefore has no


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precedential value, and this Court is not bound by that vacated opinion to

apply a “stricter burden of proof” upon Empower to establish that Pierce

waived the right to a jury trial.

      Crucially, though, the Court in Chilutti II based its holding solely on

procedural grounds. The Chilutti II Court’s lack of jurisdiction prevented it

from either approving or disapproving of the two-prong test applied by this

Court in Chilutti I. Following Chilutti II, it became an open question whether

the test employed in Chilutti I comports with Pennsylvania and federal law.

      Recently, in a post-Chilutti II published opinion, Duffy v. Tatum, No.

483 EDA 2025 (Pa. Super. filed March 3, 2026), a panel of this Court reviewed

a trial court’s denial of preliminary objections seeking to compel arbitration

terms found in an online agreement. The arbitration terms were contained in

“hyperlinked terms of service on a website that [the user] never clicked on,

viewed, or read.” Id., at *3.

      The Duffy Court echoed Chilutti I’s staunch support for the

constitutional right to a jury trial, holding that “a strict burden of proof is

necessary to demonstrate a person's unambiguous manifestation of assent to

arbitration.” Duffy, No. 483 EDA 2025, at *7. The Court then applied the

two-prong test of Chilutti I and held that the subject arbitration terms had

not been “prominently displayed” enough to give notice that completing the

online registration would constitute a waiver of the constitutional right to a

jury trial:


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       This standard has not been met here. Duffy never clicked on the
       hyperlink providing the terms of service. Dolly's website and
       application screen does not explicitly state that the consumer is
       waiving their right to a jury trial when they agree to the terms of
       service. Duffy was able to complete his registration process
       without being fully informed of the waiver of his right to a jury
       trial. The hyperlink that opens the terms of service hides the
       arbitration agreement within the middle of the document and does
       not place it in prominently in the document. Further, the
       arbitration provision never defines arbitration and does not state
       explicitly that a user is waiving his right to trial by jury. Therefore,
       it is clear Duffy was never informed in an explicit and upfront
       manner that he was waiving his constitutional right to seek
       damages through a jury trial.

                                               ****

       We therefore find the trial court did not err in overruling Dolly's
       preliminary objections. Duffy never saw the terms of service and
       did not unambiguously assent to arbitration. Dolly's website did
       not provide reasonably obvious notice of its terms of service and,
       consequently, there was no meeting of the minds. As such, the
       order of the trial court is affirmed.

Id., at *8.4

       Duffy is not just instructive, but also controlling in the instant case. “As

we often recognize, a prior published opinion issued by a panel of this Court

constitutes binding precedential authority.” Commonwealth v. Harris, 269

A.3d 534, 539 (Pa. Super. 2022) (citation omitted).            Accordingly, we are




____________________________________________


 4  This Court made clear in Duffy that it was “borrow[ing] substantially from
this Court’s well-founded en banc decision in [Chilutti I,]” and that the degree
of protection it afforded to the right to a jury trial was “consistent with” that
en banc decision. Duffy v. Tatum, No. 483 EDA 2025 at *n2 (Pa. Super.
filed March 3, 2026).

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bound here to apply standards first articulated in Chilutti I and then expressly

adopted in our precedential opinion in Duffy.

      Here, Empower’s application screens did not explicitly state that Pierce

would be waiving the right to a jury trial by agreeing to Empower’s “terms and

conditions,” or that the registration process could not be completed until the

consumer is fully informed of that waiver. Thus, we hold that the trial court

did not err in overruling Empower’s preliminary objections seeking to compel

arbitration.

      Order affirmed.




      5/1/2026




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