NOW Corporation Terms & Conditions: 4 Critical Legal Risks and How to Fix Them | Erayaha

When Legal Loopholes Can Cost Millions: NOW Corporation’s Terms & Conditions Under the Microscope

Imagine a scenario where a single ambiguous clause exposes your company to multi-million dollar lawsuits or regulatory fines. Our analysis of NOW Corporation’s Terms & Conditions reveals four critical legal and logical errors that could result in severe financial and reputational damage. Here’s what every business leader should know—and how to fix it.

1. Ambiguous Limitation of Liability: Risk of Uncapped Damages NOW Corp.'s limitation of liability clause is overly broad and fails to specify exclusions for gross negligence or willful misconduct. In jurisdictions like the EU and U.S., such omissions can render the clause unenforceable, exposing the company to uncapped damages. For example, litigation costs for a single data breach can exceed $4 million (IBM, 2023).

Legal Analysis

critical Risk

Removed

Added

To the fullest extent permitted by law, NOW Corp. shall not be liable for any direct, indirect, incidental, special, or consequential damages resulting from the use or inability to use the website, except in cases of gross negligence, willful misconduct, or where liability cannot be excluded under applicable law.

Legal Explanation

The original clause is overly broad and may be unenforceable if it attempts to exclude liability for gross negligence or willful misconduct. The revision clarifies exceptions, aligning with international legal standards and reducing the risk of the entire clause being struck down.

2. Indemnification Clause: Missing User Notice and Defense Rights The indemnification section lacks a requirement for NOW Corp. to notify users promptly of any claims and fails to grant users the right to participate in their own defense. This omission can lead to unfair settlements and increased liability, with potential losses reaching hundreds of thousands in legal fees.

Legal Analysis

high Risk

Removed

Added

You agree to indemnify and hold harmless NOW Corp., its affiliates, and their respective officers, directors, employees, and agents from and against any claims, liabilities, damages, losses, and expenses arising out of or in any way connected with your use of the website, provided that NOW Corp. promptly notifies you of any such claim, allows you to participate in the defense and settlement of the claim, and does not settle any claim without your prior written consent.

Legal Explanation

The original clause lacks procedural safeguards for users, such as notice and participation rights. The revision introduces these protections, ensuring fair process and reducing the risk of unfair settlements or excessive liability for users.

3. Governing Law: Unspecified Jurisdiction Creates Enforcement Uncertainty The governing law clause refers to "[Your Jurisdiction]" instead of specifying the Philippines. This creates ambiguity, risking forum shopping and costly cross-border litigation. Unclear jurisdiction can add $50,000+ in legal expenses per dispute.

Legal Analysis

high Risk

Removed

Added

These Terms shall be governed by and construed in accordance with the laws of [Your Jurisdiction]the Philippines, without regard to its conflict of law principles.

Legal Explanation

Leaving the jurisdiction as a placeholder creates ambiguity and increases the risk of forum shopping or unenforceable judgments. The revision specifies the applicable law, providing certainty and reducing cross-border litigation risks.

4. Account Registration: Inconsistent with Actual Website Functionality The T&C references account registration, but the website only uses form submissions. This inconsistency can invalidate user obligations and weaken enforceability, potentially undermining the company’s ability to defend against misuse or fraud.

Legal Analysis

medium Risk

Removed

Added

Certain features of our website may require registrationyou to submit forms. You agree to provide accurate, current, and complete information during the registration processin any form submission and to update such information as necessary to keep it accurate, current, and complete.

Legal Explanation

The original clause references account registration, which does not reflect the actual website functionality. The revision aligns the T&C with the website’s use of form submissions, ensuring enforceability and clarity of user obligations.

Conclusion: Proactive Legal Redlines for Sustainable Growth Our examination shows that NOW Corporation’s current Terms & Conditions expose the company to significant legal and financial risks. Addressing these issues with precise, enforceable language can reduce litigation exposure, regulatory fines, and reputational harm. Proactive contract review isn’t just a legal necessity—it’s a business imperative.

How often does your company audit its legal documents for compliance gaps?
What would a multi-million dollar lawsuit mean for your business continuity?
Are your contracts benchmarked against global best practices?

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*This analysis is for educational purposes only and does not constitute legal advice. For actual legal guidance, consult with a licensed attorney. This assessment is based on publicly available information and professional legal analysis. See erayaha.ai’s terms of service for liability limitations.*