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Re: software licensing


On Fri, 4 Sep 1998, Richard Braakman wrote:

>No, shrinkwrap licenses have never been held up in court.
>They are the myth.

Jan. 4, 1996: "ProCD Inc. v. Matthew Zeidenberg and Silken Mountain
  Web Services Inc.", 908 F.Supp. 640 

7th Circuit, Judge Easterbrook.  ProCD made the claim that Zeidenberg
violated the "Non-Commercial Only" part of the shrinkwrap license.
Originally, a district court ruled against them, citing that the license
terms were not visible to the consumer at time of purchase, and because
federal copyright law preempted enforcement of the license.  This was
overturned by Easterbrook, who held that shrinkwrap licenses are
enforceable as long as the terms are valid under general contract

"Notice on the outside, terms on the inside, and a right to return the
software for a refund if the terms are unacceptable (a right that the
license expressly extends), may be a means of doing business valuable
to buyers and sellers alike," according to the Court of Appeals.

(Excerpted from Law Journal Extra, an online publication.  See: 

This was the last reference to that case I am aware of, so currently,
it has been shown that shrinkwrap licenses are, in fact, enforceable
in the United States *even when the terms aren't even visible prior to
the sale*.  If another armchair lawyer (or even a real one ;) is aware
of a more recent reference, I'd appreciate hearing about it.  Two
side-notes to this:  There are a number of other cases that conflict
with this, so it's not an uncontested thing, and also there is
legislation in the works (The Uniform Commercial Code Article 2b) that
would decide this once and for all.  Unfortunately UCC 2b is heavily in
favor of shrinkwrap licensing, despite opposition from a number of
people including Ralph Nader.

I find this quite disturbing, myself, but that's the way it stands.
Here's to hoping that free software will provide sufficient
alternatives to most applications that the public can afford to NOT
buy software with shrinkwrap licenses, and that the courts will
remember to pay attention to that term "valid under general contract
principles", whatever that means, so that you can't make it part of a
valid license that a commercial production-level software application 
can destroy your system with no recompense...

 Zed Pobre <zed@va.debian.org>  |  PGP key on servers, fingerprint on finger

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