UCITA Hits A Few Speedbumps

mmt writes: "The Los Angeles Times has an interesting article on the past, present and future of the UCITA." Slashdot has covered the Uniform Computer Information Transactions Act before. It's interesting to see that some of the brighter purchasing agents have already encountered and rejected attempts to use UCITA in out-of-state contracts. Have you or your company run into a situation where a software company wanted you to buy software under UCITA's rules?

Re:Amazing

Their solution to the high cost of litigation: "We're always right and no one can ever sue us over anything!"

It's not as though consumer lititgation is exactly destroying their profits, either. Microsoft is one of the most profitable companies in the country, so the current level of consumer litigation is hardly driving them into bankruptcy. I hadn't thought of it in exactly these terms, either, but what does it say about a company when they argue that they can't be honest with their customers because it would cause too many lawsuits? Is there any worse indictment of the industry as it now exists than their own admission that being honest with their customers would result in increased litigation and decreased customer choice?

UCITA reminds me of MS Office Subcription Edition

Under UCITA, MS would be given the ability to impose a subscription format for all of its software without you agreeing or even knowing about it. The clause saying this would be easily tucked away inside the shrink-wrap license without the consumer having to have even known about it. Further, under UCITA, Microsoft can shut off your software remotely whenever they want if they feel you have violated any of the clauses of their shrink wrap license (or any other 'implicit' license they feel you have been subjected to by purchasing or using their software). Microsoft has been and is one of the primary backers of UCITA. This is not a mistake. MS wants to have full control over what it has supposedly "sold" to you. But, because of UCITA, you haven't really bought anything because full control of the product (just like under Office Subscription Edition) rests with Microsoft and, even without court order, they can repossess what they have supposedly "sold" you.

Making law that doesnt stick

As a rule of thumb when making laws (As if I have such experience) Laws are useless unless there are clear and obvious ways of how to uphold them. (Drugs, anybody?) From the article: "...would allow software companies to ban the sale of used software, [...] and even block the publication of critical reviews of their products.."

1. How are they going to ban me of selling my copy of Age of Empires to my brother for $10?
2. Word of mouth spreads quickly on the Internet, I can't wait to see how they are going to ban negative reviews

Laws have to be simple enough so people don't have to take their case to court everytime and pay a laywer some X amount of dollar by the hour. (But of course, laywers would love that) In fact, with more complex laws, the state is beginning to look like the Catholic Church in the Middle Ages. (Clerks = Laywers, Cardinals = Senates, Big bad corporations = Big bad Feudal lords) There is simply no way that these laws can be upheld, and therefore they are waste of good trees...
Just my 2c

How can this be reasonable?

One question that I've always had about UCITA is how it can possibly be reasonable to manage software sales under any state law, much less try the nonsense approach that MS et. al. are trying under which the sale can be held to be under a state that has no apparent relevance to the sale. If I (a citizen and resident of California) buy software written by Microsoft (a Nevada corporation whose primary place of business is in Washington) through a local store, what in hell do the laws of Virginia or Maryland have to do with it? You could plausibly argue that the sale should be under California law, or less plausibly under Washington or Nevada law, but why should the laws of a state where none of the principles of the sale are involved have any relevance? If anything, this is the clearest possible case of interstate commerce and should be handled by a Federal, not a State law. Any plausible suggestions?

Re:Amazing

Oh oh. Can't have any "tangible harm" to three of the most profitable companies in recent history. It would be unconscionable if we permitted anything to put a dent in Microsoft's 10-figure profits. [microsoft.com]

It's getting to the point where these megacorps are acting as if they're entitled to this kind of obscene profit, claiming legal protection for every cent they make. What ever happened to competition? What ever happened to earning your profits?

AOL and Microsoft are in businesses where the incremental cost of their products are practically nil compared to the cost of the first item. I know I don't have to tell you how obscene the pricing structures are for MS products. THAT should be the subject of uniform legislation...

In FY2000, MS Office accounted for $7 billion [ecommercetimes.com] in sales for MSFT, just under a third of their total revenue, and the new release (Office 2000) was on the market only a fraction of the year. That's immense! And don't try to convince me it cost anywhere near $7 billion to write MS Office 2000. (And if it really, truly did, then Bill is hiring the wrong programmers.) For chrissake, if you're selling $23 billion worth of goods and services and making $2.2 billion in profit per quarter, you don't need a law to make it any easier to turn a profit. Hell, a lot of people are claiming that the rest of us need laws to protect us from you. But then, we don't have hundreds of millions of dollars to influence legislators with.

Go away, Bill, Steve, and Andrew. Go spend your money on some island nation somewhere where you can make your own laws. Leave ours alone.

Re:How can this be reasonable?

Absolutely... This legislation is an insult to consumers, to the US Constitution, and to the intelligence of those of us in the IT/IS industry who make software purchases (and unfair to consumers who are just coming to grasps with such issues)...

It is a clear case of interstate commerce that should be regulated by Federal law, in the case where the purchasing occurs accross state borders. If you buy it in a store in California, you should be bound by California laws regarding trade, but the vendor who sold it to you would be bound by Federal law (which doesn't yet exist here) unless the software manufacturer was also in California. Applying the laws of a state in which none of the transaction participants resides is ridiculous, and likely unconstitutional.

But let's look at some of the other stupidity involved...

Reveal contract terms AFTER the sale? That certainly sounds like at least failure to disclose terms, if not bait-and-switch (if partial disclosure is used to misleading ends). It violates various consumer protection laws.

Forbid publication of critical reviews? This sounds like it violates more laws than I could possibly personally know, not to mention at least one constitutional amendment... Forget combatting this through "viral reviews" on the internet, folks, this is a basic civil liberty under attack for the purposes of market manipulation and trade collusion. This kind of supression of freedom of speech, of the press, of public figures (and products) to be freely criticized and lampooned is the most foul of affronts against the the Bill of Rights...

Avoid fixing software bugs? This sounds like it would violate various consumer protection laws, and probably lead to the passage of "lemon laws" for sofware...

Forbid resale of used software? Under "license to use" terms this could be done, but it is questionable and certainly runs counter to the current custom of transferrable licenses. It also can be gotten around if licenses can be transferred by free if you give away the license and charge a service fee (something I learned from tech companies themselves... ;-)

How to combat this?
1) Write your state legislatures and tell them "no way this will happen here"
2) Form a class action lawsuit among all the powerful interests opposed to the legislation and take Maryland and any companies tryint to hide behind their laws to the supreme court on constitutional grounds regarding their attempts to usurp interstate commerce and supress the freedom of the press
3) Reject all sales based on application of UCITA, particularly in states you do not reside in
4) Join ongoing efforts against it (see below)
5) Write software makers threatening to stop buying their software if they do not withdraw their support for this
6) Stop buying their software, anyway, and use more free software...

To find out more about this odious sack of legislative feces, check out:

http://www.cpsr.org/program/UCITA/ucita-fact.htm l
http://www.ieeeusa.org/grassroots/ucita/
http://www.cptech.org/ecom/ucita/
http://www.consumerlaw.org/ucita/
http://www.law.upenn.edu/bll/ulc/ulc_frame.htm

UCITA... Stupidity

Sometimes I really have to wonder just how dumb legislatures are. I mean, sure their getting money from passing laws like this one, but don't they realize that harmful laws like this effect them too? I guess anyone will do something for a buck.

The article is very interesting but I don't see many speed bumps ahead other than a million court disputes over which version of UCITA is right. Either way its bad of OSS simply because in on these battles it will be the Open-Source side that gets slapped with the gag-orders and injunctions that keep us from doing business.

Stand up for your rights, fight UCITA when it comes to your state.

Never knock on Death's door:

Amazing

It's absolutely amazing the nonsense that comes out of these people. A particularly revealing quote from the article:

Requiring disclosures similar to those for used cars or other hard goods "would create tangible harm through increased costs, litigation and a likely decrease in competition and product choice," wrote the Commerce Coalition, whose members include AOL, Microsoft and Intel.

IOW they claim that it's too expensive to require them to give consumers honest information about their products. At the same time, they want to be able to put terms into their licenses that would make it impossible for third parties to review their products honestly. So much for being able to make informed purchasing decisions, which any economist will tell you is essential for an effective marketplace. At the same time, they want the right to refuse refunds to consumers who do buy the software and then find out how useless it is.

An attorney's solution

I am an attorney, and I do a lot of negotiation over software licenses. I used to always insert a clause that says:

The Parties hereby agree that this Agreement shall not be governed by the United Nations Convention on the International Sale of Goods.

Now, that clause says:

The Parties hereby agree that this Agreement shall not be governed by the United Nations Convention on the International Sale of Goods nor the Uniform Computer Information Transactions Act or any implementation thereof.

I have yet to hear any objection to this language during negotiations. I am hoping this practice of negating UCITA becomes as common as negating the UN convention (i.e. very common).

-Steve

Corporate management

No. I haven't been asked to buy software under UCITA rules. But I have been asked to do something that's similar, in a frightening sort of way.

My company recently enacted a "code of conduct", under which "software piracy" is not allowed. My section manager requested me to "buy a licence" for a Linux server I had installed. No matter how I tried to explain the GPL to him, he wouldn't budge, so I had to order a Linux distro. I hope he's satisfied now.

Obligatory Slashdot poll - Who is stupidest?

• Polish judge for taxing free software.
• French judge for banning Frenchmen from Yahoo Auctions.
• US legislators for passing UCITA.
• All of the above.

One potental roadblock for UCITA

One of the major issues that has been discussed in various state and federal courts is the issue of interstate commerce, and specifically, the fact that states cannot pass laws that attempt to supercede federal interstate laws. A good recent example: a NY court voided new legislation that banned the sale of cigarettes through mail order or internet sales; the law was passed to 'protect the children' in the general sense. The courts rules that NY state cannot deam what can go in or out of it's borders being a state.

All we need is for a similar challenge to UCITA in Virgina or other states to prove that it challenges federal interstate commerce -- the way I've heard the proponents of UCITA talking was to get it passed by a majority of states prior for such a suit to take hold as to show that a majority of the states want that, as opposed to a single state passing the law. If it can be defeated in a court of law now, while only a couple states have passed it, then the only chance for it to become law is via federal law, and the FTC would be watching the passing of that very very carefully, since they are already critical of the software industry.

Re:Corporate management

You should have asked your manager to buy the FSF Deluxe Distribution [gnu.org] for $5000

Re:Keep fighting - Captialism can be your friend

Two points:

Big Bad Business is NOT saying "I am on your side." Rather, in pursuing their own selfish interest, they happen to marching the same way. No need to trust them. Use them.

Given your user name, I wonder if your inability to trust applies to more than just economic organizations.

Re:United Nations Convention?

It is a set of contract provisions that in some cases would be read into international agreements. When it was developed, no one knew how they would be applied, and no one wanted to be the "test case" for these new provisions. So, attorneys, being the risk-averse set we are, started putting language in agreements that explicitly disclaims application of the UN Convention.

As long as the UN Convention is not typically used, attorneys will shy away from having it apply to their agreements, and they will avoid it in their agreements. My hope is that UCITA suffers a similar fate: obsolescence through non-use.

-Steve

P.S. I do want to point out that my knowledge of the UN Convention on the International Sale of Goods is skimpy at best. There may be a lot of valuable case law out there interpreting it -- but lacking that knowledge, I avoid it.

off topic: Richard Stallman, a pioneer in the "ope

From the article:
"
More recently, the plan has been attacked by Richard Stallman, a pioneer in the "open-source" movement to develop free software in collaboration, and by Red Hat and other companies that sell or support Linux, a computer operating system that is available at no charge on the Internet.
"

Kind of illustrates why Stallman is so picky about distinction between 'open-source' and 'free software'.

Free software > Open Source. Free software != Open source.

-Laxitive