Cookie Banner That Passes Privacy Review May Still Void Your Arbitration Clause

Cookie banners are no longer only a privacy-compliance tool. Recent Ninth Circuit and district court decisions in 2025 and 2026 have made clear that cookie banners can play a meaningful role in determining whether an online contract was formed. For businesses using banners to manage CIPA, CCPA, and website-tracking risk, they can also become part of the record courts use to examine whether a consumer agreed to Terms of Use, an arbitration clause, and a class-action waiver. That creates a critical distinction: a banner may be sufficient to obtain consent for cookies or tracking technologies yet still fail to create an enforceable contract.

Accepting Cookies Does Not Mean Accepting Arbitration

A user who clicks “Accept All Cookies” may be consenting to analytics, advertising, session-replay, chat, or similar technologies. That does not necessarily mean the user understood that they were also agreeing to arbitrate disputes or waive the right to pursue a class action.

Companies increasingly combine privacy and legal notices in a single experience:

•    “By continuing, you agree to our Terms.”
•    “By accepting cookies, you agree to our Terms of Use.”
•    A cookie banner links to a privacy policy, which links to Terms containing arbitration language.
•    A sign-up or checkout page places a terms link near a “Continue” or “Create Account” button.

Those flows may be efficient, but they can present a contract-formation problem. The question is not only whether the user saw legal language. Courts ask whether the notice was reasonably conspicuous and whether the user took action that clearly indicated agreement.

Common UX Problems

The following choices can undermine an online agreement:

•    A terms link in small, faint, or low-contrast text.
•    Terms language placed far from the button the consumer clicks.
•    A button labeled only “Continue,” “Accept,” or “Start Trial.”
•    Language that does not state that clicking constitutes agreement to the Terms.
•    A cookie-consent button used as the only evidence of agreement to arbitration.
•    Legal disclosures that appear differently—or less visibly—on mobile devices.
•    Failure to retain screenshots, version histories, and user acceptance records.

A privacy banner can be prominent enough to obtain tracking consent while still being too ambiguous to establish assent to a separate arbitration agreement.

A Better Approach

Keep privacy consent and contractual assent distinct.

Use the cookie banner to explain tracking technologies and provide privacy choices. Then, at account registration, checkout, subscription enrollment, or another meaningful transaction point, use clear assent language such as:

By clicking “Create Account,” you agree to the Terms of Use, including the Arbitration Agreement and Class Action Waiver, and acknowledge the Privacy Policy.

The linked documents should be readable, visually conspicuous, and immediately adjacent to the relevant button. For higher-risk transactions, an unchecked checkbox requiring affirmative agreement may provide stronger evidence of assent.

Reassess Arbitration Terms

Even a properly formed arbitration agreement should be reviewed for current mass-arbitration risk.

Businesses should periodically review:

•    Their arbitration provider and incorporated rules.
•    Mass-arbitration fees and administrative exposure.
•    Class-action waiver and severability language.
•    Delegation, venue, and hearing provisions.
•    Whether the clause remains consistent with current provider requirements and consumer-protection standards.

The Takeaway

For companies implementing cookie banners to reduce CIPA and tracking-related risk, the banner should not be treated as a one-stop legal solution. It may help demonstrate privacy consent, but it may not establish a valid agreement to arbitrate.

The safest approach is to treat cookie consent, website terms, and arbitration as related, but separate, legal and UX issues. Clear notice, affirmative assent, careful interface design, and reliable recordkeeping are essential if a company expects its online arbitration clause to hold up in court.