Summary of Electronic Signature Legality<\/p>\n
Electronic signatures are legally recognized in the United States and governed by the federal Electronic Signatures in Global and National Commerce Act (\u201cESIGN\u201d) as well as state and territorial versions of the Uniform Electronic Transactions Act (\u201cUETA\u201d).<\/p>\n
The U.S. adopts a dual-layer model: ESIGN serves as the federal law, while 49 states, the District of Columbia, and Puerto Rico have adopted their own versions of UETA. New York has a similar law to UETA. ESIGN and UETA only apply to electronic records and signatures related to transactions.<\/p>\n
Under ESIGN, a “transaction” refers to an action or set of actions occurring between two or more persons relating to the conduct of business, consumer, or commercial affairs, including:<\/p>\n
The sale, lease, exchange, license, or other disposition of: personal property (including goods and intangibles), services, or any combination thereof;<\/p>\n
The sale, lease, exchange, or other disposition of any interest in real property, or any combination of these.<\/p>\n
The term \u201cperson\u201d includes an individual, corporation, business trust, estate, trust, partnership, limited liability company, association, joint venture, governmental agency, public corporation, or any other legal or commercial entity.<\/p>\n
Under UETA, a \u201ctransaction\u201d refers to an action or set of actions between two or more persons relating to business, commercial, or governmental affairs. \u201cPerson\u201d is defined in the same way as in ESIGN.<\/p>\n
An electronic signature cannot be denied legal effect, validity, or enforceability solely because it is in electronic form. That said, if the validity of an electronic signature is challenged, the party seeking to enforce it must:<\/p>\n
Prove that the signer intended to sign the electronic record;<\/p>\n
Attribute the electronic signature to the signer (which can be done by any means);<\/p>\n
Ensure the electronic signature is attached to or logically associated with the record being signed;<\/p>\n
Provide the signer with a copy of the signed record;<\/p>\n
Maintain the signed record in a secure way to preserve its integrity.<\/p>\n
Note: There have been no significant changes to U.S. electronic signature laws since 2020.<\/p>\n
Permissible Types of Electronic Signatures<\/p>\n
ESIGN and UETA define an electronic signature as any electronic sound, symbol, or process that is attached to or logically associated with a record and executed or adopted by a person with the intent to sign the record.<\/p>\n
Documents That Can Be Electronically Signed<\/p>\n
The following types of transactions are generally suitable for electronic signatures:<\/p>\n
Human Resources<\/p>\n
Non-disclosure Agreements<\/p>\n
Software Licensing<\/p>\n
Education<\/p>\n
Life Sciences<\/p>\n
Technology<\/p>\n
Consumer Transactions (excluding certain post-default notices and non-uniform exceptions in California\u2019s UETA)<\/p>\n
Transactions Requiring Evaluation Before Use<\/p>\n
Although not explicitly prohibited, the following types of transactions should be carefully evaluated before using electronic signatures. Examples include:<\/p>\n
Corporate Resolutions<\/p>\n
Procurement<\/p>\n
Bills of Lading<\/p>\n
Healthcare<\/p>\n
FDA Clinical Trial Records<\/p>\n
Banking<\/p>\n
Wire Transfer Agreements<\/p>\n
Lending<\/p>\n
Real Estate<\/p>\n
Chattel Paper<\/p>\n
Insurance<\/p>\n
Documents requiring notarization<\/p>\n
Documents requiring recording<\/p>\n
Government Filings<\/p>\n
Key Case Law<\/p>\n
The following six cases are notable examples where U.S. courts addressed issues related to electronic signatures:<\/p>\n
Moton v. Maplebear, Inc., 2016 WL 616343 (S.D.N.Y. Feb. 9, 2016)<\/p>\n
Harpham v. Big Moose Inspection, No. 321970, 2015 WL 5945842 (Mich. Ct. App. Oct. 13, 2015)<\/p>\n
Yearwood v. Dolgencorp, No. 6:15-cv-00898-LSC, 2015 U.S. Dist. LEXIS 138993 (N.D. Ala. Oct. 13, 2015)<\/p>\n
Zulkiewski v. General American, 2012 WL 2126068 (Mich. Ct. App. 2012)<\/p>\n
Barwick v. GEICO, 2011 Ark. 128 (Ark. 2011)<\/p>\n
IO Moonwalkers, Inc. v. Banc of America Merchant Services, 814 S.E.2d 583 (N.C. Ct. App. 2018)<\/p>\n","protected":false},"excerpt":{"rendered":"
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