IP: James Gleick: It's Your Problem (Not Theirs)

[Dave Farber <farber () cis upenn edu>]

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Re:     UCC 2B issue


Those interested in the "shrink wrap contract" issue should take a look
at James Gleicks "It's Your Problem (Not Theirs) from
http://www.around.com/agree.html, which ran in edited form in today's
New York Times Magazine.   Jamie


--=20
James Love
Consumer Project on Technology
P.O. Box 19367, Washington, DC 20036
love () cptech org | http://www.cptech.org
202.387.8030, fax 202.234.5176<x-html>
<BASE HREF=3D"http://www.around.com/agree.html";>


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It's Your Problem


(Not Theirs)=20


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=A9Copyright 1998 James Gleick=20


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I seem to remember that when I subscribed to, oh, The New Yorker, I sent in
some
money and eventually the magazine started arriving in my mailbox. Not so
simple
in the digital era. The other day I used my computer to subscribe to Slate,=
 an
on-line magazine owned by Microsoft, and after I gave up my name, E-mail
address, postal address, credit-card number, and choice of gift (I declined
the
free umbrella), the screen presented me with the first few lines of a
2,000-word contract. Below this was a button marked "I Agree." There was
also a
button marked "Cancel." I looked in vain for a button marked "Let's
Negotiate--My Lawyer Will Be in Touch with Your Lawyer."=20


I realize now that before you read any further we should agree on some=
 ground
rules.=20


First of all, by reading Fast Forward you confirm your acceptance of, and
agree
to be bound by, and promise never to call your lawyer to make light remarks
about, this Agreement.=20


Further, you're not buying a car or a toaster here. This department makes no
express or implied representations or warranties to you regarding the
usability, condition, or operation thereof. We do not warrant that access or
use will be uninterrupted or error-free or that we will meet any particular
criteria of performance or quality. No matter how bad the product is, it's
your
problem, not ours.=20


And after all this, if you think you've found a loophole and actually wish=
 to
sue, start by calling your travel agent, because you consent to the=
 exclusive
jurisdiction and venue of courts in King County, Wash. Oh, no, wait--that's
Microsoft.=20


"Yes, it's absurd," says Michael Kinsley, Slate's editor. But no more=
 absurd,
he adds, than agreements at other sites. (Sure enough, The New York Times
has a
long contract for its own on-line subscribers.) Internet magazines are more
complicated, interactive, and bug-prone than their print ancestors and thus
require, in a litigious world, more complicated legal armor. You aren't=
 really
expected to understand it. "The entire software industry, for that matter,
depends on its customers not really reading these things before clicking 'I
accept,'" Kinsley says.=20


The software industry also relies on a clever legal twist: the notion that
consumers are entering into ongoing licensing agreements with the
manufacturers. You may think, as you walk out of a store, package under your
arm, that you have bought that software. The industry claims that you have
merely licensed certain limited rights to use it. It says so right there in
the
agreement you will find under the shrinkwrap and toss away unread.=20


As a licensee, you commit yourself to a set of continuing duties. In the=
 case
of Slate, for example, you agree to supervise any usage by minors and to
notify
Microsoft "promptly"--even though you've already paid--if you change your
billing address, lose your credit card or "become aware of a potential=
 breach
of security." Kinsley says he persuaded the lawyers to drop a clause that
would
have required all his readers to maintain their computer equipment in=
 working
order.=20


Are all these shrinkwrap and "clickwrap" agreements really enforceable?=
 After
all, the manufacturers know perfectly well that customers have neither the
time
nor the expertise to read them, and often the agreements are hidden in boxes
until well after the customers have paid up. No one knows for sure. In real
life, manufacturers almost never try to enforce the sillier terms, and most=
 of
the damages people suffer from defective software tend to be in the nature=
 of
lost time--hours spent cursing the computer or waiting on hold for technical
support--and it's hard to sue over that.=20


Steve Tapia, a Microsoft corporate attorney, says it just wouldn't be fair=
 to
hold software to the same standards as, say, a car. That's lucky for him,
because car makers have found it very expensive to sell cars with
defects--especially defects they knew about. They can't just disclaim any
obligation to guarantee their products. Software is different, Tapia says,
"because personal computer software may be used for a myriad of different
purposes on an infinite amount of hardware combinations."=20


In the early days of personal computers, users were mostly technical types
willing to wrestle with flawed software. They forgave some of the bugs, in
versions 1.0, anyway. Now that computers are a mass-market product, they=
 reach
more na=EFve customers who might actually expect their software to work.=
 That
must be why dozens of companies feel compelled to make users agree that
they're
on their own if they use the products in hazardous environments requiring
fail-safe performance, such as in the operation of nuclear facilities,
aircraft
navigation or aircraft communication systems, air traffic control, direct=
 life
support machines, or weapons systems, in which failure of the software could
lead to death, personal injury, or severe physical or environmental damage.=
=20


Some legal departments have been getting more creative lately. Customers who
download Network Associates' antivirus software "agree"--click--to clauses
designed to give the company control of press coverage: "The customer shall
not
disclose the results of any benchmark test to any third party without=
 Network
Associates' prior written approval" and "the customer will not publish=
 reviews
of the product without prior consent."=20


Meanwhile, the agreement that comes with Microsoft Agent, software that lets
people create cute interactive animated figures, holds that you may not use
the
characters "to disparage Microsoft, its products or services." Will the next
version of Microsoft's operating system have a clause like that? I'll have=
 to
find a typewriter?=20


Perhaps some of these contract terms are striding defiantly past the limits=
 of
existing law--but the law is likely to change shortly, in all 50 states. A
major revision is under way in the foundation of American commercial law,=
 the
Uniform Commercial Code. The drafters, a committee of lawyers established=
 for
the purpose, have created a new statute, Article 2B, specifically to cover
software and other information products. To the horror of some consumer
groups,
<http://www.law.uh.edu/ucc2b/>the current draft--expected to go to the state
legislatures in January--ratifies the most aggressive provisions of today's
software licenses.=20


It would set into law the idea that software customers aren't buying "goods"
but merely licensing certain rights. It makes the licenses binding even when
customers have not read them, when the customers casually clicked an on-line
button, and when the customers could not have seen the agreements until=
 after
buying the products.=20


The draft legitimizes confidentiality and nondisclosure clauses like Network
Associates', forbidding users to publish reviews of a product. And it would
explicitly allow manufacturers to disclaim warranties; it even suggests
language: "this [information] [computer program] is being provided with all
faults, and the entire risk as to satisfactory quality, performance,=
 accuracy,
and effort is with the user."=20


"It's the drafting committee's view that bugs are inevitable in software and
that makes software different," says
<http://www.badsoftware.com/uccindex.htm>Cem Kaner, a lawyer and software
consultant opposing these provisions. He argues that Article 2B in its=
 present
form will be a disaster not only for consumers but also for the more=
 honorable
software companies; it will reward companies that try to grab market share=
 by
rushing to market with buggy software.=20


"If there are no refund rights, no lawsuit rights, no legal disincentives,
then
companies that ship prematurely enjoy an unfair advantage," Kaner says. "In
the
process of protecting the worst companies from the consequences of their=
 worst
products, we pressure better companies to do a worse job."=20


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First published in the New York Times Magazine, 10 May 1998=20


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<http://www.around.com/>Back to James Gleick's home page=20


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