Subject: RE: a proposed change to the OSD
From: "Lawrence E. Rosen" <lrosen@rosenlaw.com>
Date: Sun, 27 Oct 2002 08:54:38 -0800

David Johnson wrote:
> You completely misunderstand me. Then again, perhaps I 
> misunderstood you. I 
> had assumed that your use of the term "click-wrap" referred 
> to a license 
> presented to the user *after* the software was aquired. If you cannot 
> understand my disagreement with this kind of licensing, just 
> imagine that 
> this practice was common in the automobile industry. Imagine you have 
> purchased a new car, received a bill of sale, etc., then 
> noticed on the 
> steering wheel a piece of paper that said you had to agree to 
> an additional 
> contract before you could drive the car.
> 
> I do NOT have a problem with click-wrap licenses that are 
> presented to the 
> user BEFORE the software is obtained. Okay, I may have 
> problems with some 
> actual licenses, but not with the concept.

I have NEVER suggested that an after-the-fact click-wrap notice would be
effective.  Indeed, the entire concept of click-wrap is intended to
prevent a situation where the user is not informed of the license terms
BEFORE he begins to use the software.  

A click-wrap notice must be presented to the licensee BEFORE the
software is first used.  For *practical reasons* that every reasonable
consumer of software understands, that may be AFTER the licensee has
gone to the store to buy a copy, or AFTER the download or installation
process is started.  The courts recognize these practical situations.
Therefore, with commercial software, the licensor must provide a full
money-back guarantee if the software is returned BEFORE it is actually
used.  

The click-wrap notice I previously recommended is intended to be seen
and acknowledged by the user at any reasonable time BEFORE first use --
upon download or upon first installation, whichever is most practical.

The analogy to automobiles is entirely apt.  Anyone who has purchased a
car at a dealer knows that the dealer presents a sheaf of paperwork to
be signed before the car can be driven off the lot.  Does every consumer
read the front and back of each form?  Of course not!  But if the dealer
didn't present the forms and require a signature, then the dealer would
be stuck with a returned car every time a consumer discovered he could
get the same car for $10 less at the dealer down the block, or if he
discovered that his spouse doesn't like the color.

UCITA is intended to codify, in statute, the reasonable expectations of
the parties with respect to software transactions.  That would be a good
result, so that we're not left with confused courts trying to analogize
sale-of-goods contract law with the unique characteristics of software
transactions.  Unfortunately UCITA brings along unacceptable baggage.  I
would like to see UCITA-like provisions adopted that clarify once and
for all what license terms are acceptable and which are contrary to
public policy, for example.  I would like to see a clear statement of
whether a consumer may refuse to accept a license with which he
disagrees even after he has "bought" the software.  That law has not yet
been written or adopted by the states.

In the meantime, I will recommend to all of my clients that they present
license terms to the users of their software BEFORE download, BEFORE
installation or BEFORE first use, whichever is most practical under the
circumstances.  

/Larry Rosen


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