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Washington Supreme Court Upholds Shrinkwrap Licensing
rudedog writes: "According to this Seattle Times article, the Washington Supreme Court has upheld a shrinkwrap license limiting recovery of damages due to buggy software. Apparently, the software manufacturer agreed that there was a bug that cost the plaintiff $1.95 million, but asked the court to dismiss the claim based on the license agreement [which disclaimed all liability]. Kinda answers the old open source FUD question 'who you gonna sue if something goes wrong?'. According to the WA courts, nobody." The opinion is available here, and a dissenting opinion by two of the judges is also available.
Yes, absolutely! GPL or multi-million-dollar proprietary patentware, doesn't matter. I don't believe in product liability. If you want a warranty, buy one. Consider it insurance. If someone wants to offer you a warranty, that's fine, but nobody should have to. There's no hypocrisy involved here. I agree with the court's decision.
That said, I think the decision is great for Free Software. We don't offer a warranty, neither do the big guys. If you're not going to get a warranty, you might as well go with something that's used by the guy who wrote it and costs nothing. It's one less thing for PHBs to like about non-Free software (as the poster mentions, the "whom do we sue?" attitude).
In fact, I hope we see more like this. I don't want any proprietary vendor held to answer for its products, nor do I want any term of any license, proprietary or otherwise, declared invalid. Go UCITA! Let the big software houses fuck themselves up the ass. Carry it to the logical conclusion - lay bare the true motives of the megacorporations by letting them do business as they like. Once everyone realizes that they won't stand by their products and don't give a shit about their customers, it'll be that much easier to justify the decision to abandon proprietary software. Force people to read and follow their licenses instead of letting them hide behind the shield of the law.
In an environment where the license is written in stone and backed up with the force of law without appeal or mercy, a software package's terms of use become very important criteria indeed. So much the better for those who distribute their software under more agreeable terms.
The implicit "right" to warranty isn't out of nowhere; it's part of the default-contract provisions of the Uniform Commercial Code (UCC) -- you know, that thing that's getting modified as states adopt UCITA. These provisions apply to commercial transactions unless they are overridden by other terms agreed upon by the parties to the transaction. Every commercial transaction, after all, is a contract.
Now, I don't know about you -- maybe you buy packaged distributions -- but I don't engage in commercial transactions in order to get my hands on GPLed software; I download it from Debian. Therefore, there is no commercial transaction going on; hence UCC does not apply; hence there is no implied warranty. The GPL no-warranty language is largely for show or for clarification, like a lot of the language in EULAs.
Even if you do get your GPLed software in a commercially-packaged GNU/Linux distribution, you are not entering contract with the individual authors of the software, but with the distributor. (You aren't buying Apache from the Apache Software Foundation; you're buying it from Red Hat.) Hence, if there is any implied warranty under UCC, it is between you and the distributor. And the distributor can disclaim that warranty by specifying other terms to the contract -- which the Washington case under discussion holds that it can do via a shrink-wrap agreement.
So, in other words, if Apache explodes, you may be able to claim warranty from Red Hat (if you bought it from them), but you can't claim warranty from Apache. Further, you can't even claim warranty from Red Hat in the state of Washington if they have a warranty-disclaiming EULA-style "agreement".
Microsoft's "End User License Agreement" assumes that before you agree to it, you have no right to use the software. The EULA, therefore, is phrased as a "license" to use the software. GPL, on the other hand, assumes that you already do have the right to use the software; what you lack, due to copyright law, is the right to redistribute it. The GPL, therefore, is phrased as a license to distribute the software, under certain conditions.
You'll note that you don't have to click on the GPL in order to be bound by its terms when you redistribute GPLed software. Why? Because the GPL is not a contract. The GPL is solely a license. In fact, the GPL clearly states that you do not have to "agree to" it; if you don't want to obey its terms, that's fine -- but if you do disobey its terms when distributing GPLed software, that distribution is a violation of copyright. You may obey the GPL's provisions when redistributing GPLed software, in which case you are within your rights, or you may violate its provisions when distributing GPLed software, in which case you are breaking the law.
(Note, if you will, the difference between agreeing to something and agreeing with something. The latter is an expression of opinion; the former is a declaration that one consents to be bound by a set of terms. Note also the difference between agreeing to something and obeying it. You don't need to agree to the laws against copyright violation in order to be penalized for not obeying them.)
In contrast with GPL and related licensens, proprietary EULAs aren't licenses at all; they're waivers masquerading as contracts. In exchange for the dubious "right to use" the software, they state that you must agree to waive certain rights you would otherwise have. By clicking on the little "I Agree" button, you thereby (supposedly) waive those rights in exchange for the "right to use".
But there is no "right to use" -- or rather, the right to use is inherent in legitimately-granted access to the software.
Consider: If I operate a college computer lab, I grant access to the computers in that lab to any number of students who have not clicked on any "license agreement". What grants these students the "right to use" any proprietary software that may have been (legitimately) installed on that computer? If one has to agree to an EULA to have that right, then those students, not bound by any EULA, are just as illicit as any warez d00d.
My interpretation is that what grants the students the right to use the software is the fact that they came by it legitimately -- that the software was legally installed on the computers (i.e. it was not "pirated") and that they had the right to use those computers.
Similarly, if you legitimately come by a piece of proprietary software -- say, by purchasing a CD containing it in a store, or downloading it from the manufacturer's Web site -- then you already do have the right to use it. You don't have to agree to anything. Go ahead and unzip Microsoft's Kerberos documentation with WinZip, Stuffit Expander, or unzip(1), instead of running the self-extracting archive and seeing the bogus "trade secret" EULA. You already have the right to use it within if you downloaded it legally. (You don't, however, have the right to redistribute it without a license to do so. That's copyright law.)
===
A Parable on Licensing:
Imagine, if you will, that I own a bagel shop and you purchase from me one bagel. You leave my shop; I follow you to the park, where you plan to eat the bagel. Before you take a bite, however, I exclaim: "By biting into that bagel, thus making use of the intellectual property of its recipe, you agree to waive your right to sue me if it contains radioactive waste, cyanide, or dead roaches! I do not grant you permission to eat that bagel unless you agree to these terms!"
Assuming that you do not immediately become disgusted and toss the bagel in my face or the trash can, does your biting into the bagel create an agreement between you and me? Of course not. Did you need my permission to eat the bagel? Of course not. You already had the right to eat the bagel, as you came by the bagel legitimately -- by buying it from me, its creator.
(Little hint, though: You shouldn't buy bagels made by people who want you to waive your right to sue if they contain radioactive waste.)
Surely nobody here thinks that a company should be able to sue Linus if their server dies with a kernel panic; the GPL disclaims all warranty, liability, etc. for free software placed under that license, just like the Microsoft EULA.
So how much does a software owner have to charge for a license before they have to be liable for any and all damages caused by someone using it?
Even software makers who are willing to put their money where their mouth is usually give a list of medical, nuclear, etc. applications where that liability doesn't apply. If some idiot tries to put embedded NT into a life support system, should Microsoft be liable when it bluescreens?
---
According to all the case law out there dealing with shrinkwraps, Sears could get away with this, and would have the right to sue you if you misused "their" hammer.
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Right. At which point, you walk out the door and buy a hammer elsewhere.
As consumers we vote with our pocketbooks. If an item - even software - doesn't have the license you want, don't buy it. It's 100% the consumer's fault if they purchase something with full knowledge of its license terms and decide that they didn't care for the terms they agreed to. It's not Company XYZ's fault if I'm too stupid to complain and demand something better.
- Jeff A. Campbell
- VelociNews (http://www.velocinews.com)
- Jeff
Once again, allow me to shamelessly plug my editorial putting the case against shrinkwrap "licenses".
There is, sadly, a ton of case law supporting this garbage. This despite the fact that the crushing majority of people in the US alone have no idea what a shrinkwrap "license" is, let alone the specious legal reasoning on which they stand. Thus, while the law may be on their side, I believe public opinion can be marshalled to our side fairly easily, since the ethical issues and "common sense" are fairly clear here.
Start telling your friends and neighbors about this stuff, especially if they are not computer-savvy. It's the newcomers to the digital realm who stand to be screwed the most by this.
BTW, striking down shrinkwraps as unenforceable would not affect Open Source licenses (GPL, BSD, etc.). Shrinkwraps operate off an entirely different principle.
Schwab
Editor, A1-AAA AmeriCaptions
Interested observers should check out Cem Kamer's Bad Software Web site. In particular, you'll want to read up on the court cases testing the provisions of shrinkwrap licenses and other contracts of adhesion. It's pretty depressing.
Schwab
Editor, A1-AAA AmeriCaptions
Underwhelm discusses the very issues I've been beating on for the last ten years: Shrinkwraps are a harbinger of much more evil practices yet to come. One hypothetical situation in my parade of horribles (hi, Andrew!) is the following:
One day, you walk into Sears, and find all the hammers are gone, having been replaced with two hammers: the Craftsman(R) Personal Hammer, and the Craftsman(R) Enterprise Edition Hammer.
Both hammers come in a box with a "license" printed on it. On the Personal Hammer, the license says that you can only use the hammer for personal projects, home repairs on your own home only, etc. In particular, the license forbids you from selling/profiting from anything you use the hammer to build. On the Enterprise Edition Hammer, you are allowed to use it to build stuff for sale, provided you give to Sears 1% of the gross sale price of objects the hammer was used to build.
The Personal Hammer is $35.00; the Enterprise Edition Hammer is $550.00. In all other respects, the hammers are absolutely identical .
According to all the case law out there dealing with shrinkwraps, Sears could get away with this, and would have the right to sue you if you misused "their" hammer.
Some would argue that Sears should be able to get away with it; they should be free to offer their products under any terms they choose, and if you don't like them, you can shop somewhere else. If this argument has merit, then it should be possible to purchase software under different terms.
I challenge anyone here to produce a shrinkwrapped box of closed-source software (a Linux/BSD distro doesn't count) that doesn't come with a "license." Games used to be free of such instruments; sadly, this is rapidly vanishing. Thus, the choice of alternate terms for commercial software, in practical terms, does not exist.
I believe this is an extremely bad state of affairs, and must be corrected.
Schwab
Editor, A1-AAA AmeriCaptions
I thought I'd take a moment to refute a couple of (I think) fallacious arguments that I see a lot of people making, namely: "We have to allow software to disclaim warranties, or it will be swamped by lawsuits," and, "The GPL (along with every other free software license) disclaims warranty, so isn't it just as bad?"
The answer to these points is that you should be perfectly allowed to disclaim warranty and make other conditions, but you must do so before the sale, like in any other industry.
Every other industry is required to put prominent "sold as-is, no warranty" signs up in the store for this purpose--why can't software? They would get to disclaim warranty, and consumers would know exactly what they are getting into.
With free software, you can examine the warranty before you buy because you typically download it for no cost. On the other hand, I think that vendors of commercial Linux distributions and so on should be required to disclaim warranty, and in general make the terms of the sale clear, before any money exchanges hands.
Unfortunately, it looks like the courts aren't siding with consumers and common sense on this one. Even the dissenting opinion here accepts that post-sale shrinkwrap licenses in consumer transactions are valid--they only objected because here the buyer pro-actively proposed a "contract" (a purchase order) that was accepted by the vendor.
I am not a lawyer, this is not legal advice, without even the implied warranty of merchantability or fitness for a particular purpose.
(By the way, the other terms of free software licenses, like the GPL's terms for derived works, are different from a warranty disclaimer or a shrinkwrap license. You are free to not accept them, but in that case you go with the default under copyright law: you can't distribute copies or modified versions.)
If a thing is not diminished by being shared, it is not rightly owned if it is only owned & not shared. S. Augustine
The problem is *how* they limit their liability. In this case, the construction company called the software vendor and ordered the product. The vendor shipped the product without disclaiming liability. The dissenting judge found that *this* was when the contract was made and that if the vendor felt that additional terms were required, they had the opportunity to request them *before* shipping the product.
In this case, the shrink-wrap license appeared *after* the contract was made which substantially alters the contract.
The truly remarkable thing is that the majority even accept that the vendor installed the package and the end-user NEVER EVEN SAW the shrink-wrap license.
But to address your concern: yes, small software vendors *can* disclaim liabilities, but they must do so when the contract is made and not after they ship the product...
-- Don't Tase me, bro!
A new car may have parts that fail during the warranty period. That isn't unusual. However, if the car is in the repair shop more than it is on the road, the dealer and manufacturer have a responsibility to remedy the situation.
There are implied warranties of merchantability and fitness for the intended purpose. Vendors should not be allowed to disclaim these warranties. Any claims made in advertising about features and performance should be legally binding on the vendor. It is disingenuous to disclaim all warranties and simultaneously market the product as a cure for all ills.
I hate the concept of shrink wrap licenses. Unfortunately, there is a precedent in those contracts that are printed on the backs of sports, entertainment and airplane tickets. Those have all been upheld in the courts.
Mea navis aericumbens anguillis abundat
> Personally, I don't care for them, but I think companies have the right to include them if they want to.
I'm inclined to agree. However, there should be some ground rules, e.g., you have to be able to see the full text of the license before you buy, the license cannot protect the vendor against malicious acts, the license cannot make you waive certain really basic rights, etc. (OK, maybe there wouldn't be much left after I got through with it, but these are the kinds of thing society needs to be thinking about.)
Good post; nice observations about warranties and stuff. Maybe that's how things will shake out from the free software movement: you want a warranty, you pay, otherwise you download it for free. Might not be such a bad model for the IT economy.
--
Sheesh, evil *and* a jerk. -- Jade
1) As other posters have pointed out, large, complex, software is almost impossible to write with zero defects. If most production software had to be bug free, there is no way anybody could afford it.
2) Limiting you from recovering consequential damages, etc. is something you see in almost all products for sale. And you almost never get to read the warranty before you buy pretty much everything. Just check the manual with your VCR, refridgerator, lawn mower, etc. They all, without exception, disclaim themselves from liability for incidental and consequential damages. (Except in such states that prohibit said exclusions.) Note that while this does not absolve them from gross negligence or intentional malice, but bugs in software generally would not fall into that category.
3) Put yourself in, say, a software writer's seat. If you are writing shareware with a $5 licensing fee, do you want to make yourself open to $1M+ lawsuits if someone relies on your software to do something important, and it breaks? Hell no!
The way I see it, you have one and only one of three choices:
1) Cheap/free(speech/beer) software.
2) Almost no software. (That is how much software would be written if it all had to be bug free, or else.)
3) Expensive software where you pay for the privledge of suing the pants off of the scmuck who wrote it.
Software vendors shouldn't be held responsible for their bugs. Why? Because it's pragmatically impossible to create bug-free software when you're dealing with millions of lines of code. Even if it is possible, it is economically infeasible to bring the required level of engineering to every project.
Instead, software vendors should be made accountable for process . Software Engineering is a mature body of research on the processes required to produce solidly engineered code. If Brand X software crashes my computer, I'll just have to live with it unless I find out that Brand X rushed their development cycle, slashed their budget, hired script kiddies to implement last minute hacks, and spent a whopping 10 minutes testing the final product. If that happens, I should be able to sue Brand X into nonexistance.
We could even taken it one step further and imagine a codified set of symbols that software vendors could place on their packages to indicate the level of rigor used during production. Third-party certification agencies could back these claims, and people who sue would only win when the company failed to live up to their published level of rigor. Entrepreneurs take note! There may be a market for this.
-1, Too Many Layers Of Abstraction
The capitalist system has begun an evolution. Spurred by corporate power, we have entered a new economic system I'll call License Economy.
The waning form of capitalism, the one where goods and services are exchanged for units of value, slowly yields to the new capitalism. In the new capitalism there are no goods, only services. Services are services. Goods are services. Maybe even money will be a service.
The necessity for the License Economy is clear--As the digital media companies have discovered, as the complete cost to reproduce a good approaches zero there is no incentive to purchase the good. In order to profit from a "good" in the License Economy, the goods must magically become a service; therefore converting the good into a revokable and scarce commodity, creating "value" where none existed in the economic sense.
The trick is that the License Economy will seep out of the digital domain. Licensing reliably increases margins on every non-consumable good put into the market. After all, isn't the idea behind capitalism that as the domain of the economy expands, the cost to produce a good approaches zero because of competition and trade (ignoring for the moment as economists like to do, the depletion of natural resources)?
e.g.: My client is an architect. The plans he drew for your house are an expensive combination of engineering/drafting school, knowledge of local and national code, and art, too. In fact, so very much went into your house: the blood of the construction workers and the marketing of the mortgage company, that, well, you need to pay a royalty of just 1% of your montly payment to these hardworking artisans in perpetuity. In addition, if you should ever sell the house, this does not negate the hard work and creativity put into building that house, so your buyer will need take over paying the royalties. Should you care to make an addition to the house, well, you will need to run it by the architect--to make sure it is in line with his artistic vision. He certainly has the right to control how his art is used!
What? You want to defraud these craftspeople? How will they make their living?! Etc, etc...
All long-winded allegory beside, as long as descretely ubiquitous licensing is permitted when purchasing software, it will certainly follow elsewhere, mutating goods into services as we relinquish our notions of personal property and of ownerwhip to the corporations. Sure we'll get to buy our toothpaste and other consumables, but the moment we decide to avail ourselves of a product that might stand a change of outlasting us--a corporation will be set to lease it to you, with certain provsions (for example, upon your death posession is transferred back to the parent company... Those ConGlomCo shareholders worked hard hours to assemble those raw materials into a telephone and hey certainly have a right to profit from it in perpetuity!)
NDAs are licenses for knowledge. The corporate battle against the expiry of copyright will continue to encourage the unending license of all recorded works. Oh, and does anyone remember having to lease a telephone from MaBell? Well, that's the work of a pathetic internet startup compared to the intrusions we can expect with corporate oligopolies in every corner of the market. (Here, I'm mostly talking to those pro-monopolists who decry the MS trial with "Back when ATT was in one piece was the last time I could orgasm.")
Ownership is obsolete. The money's in licenses -- and not just because you can disclaim everything under the sun; you can do that, and still own what you're "selling" too!
Does any of this sound strangely like a certain... underappreciated economic model?
I don't need large brains to have a good time.
Reading over the legal mumbo jumbo from the case, they mention that Timberline software turned up an internal memo demonstrating they -knew- the bug existed and could reproduce it by meeting only 4 explict conditions. The memo was dated 1993. The memo states that the 4 conditions are "unlikely" so therefore the bug is "unimportant".
Sheesh! Silly people.
I think this just gives more props to the virtues of GPL software -- it gives the -user- the power to decide if a bug is "important" or not.
A W S ----------- QABO : BALA
The decision in the article is a great case-study of what this site warns about.
There's a classic set of Dilbert strips parodying shrink-wrap licenses:
Bill Gates' Towel Boy
Bear with me for a moment while I play the devil's advocate. I quote from the GPL:
11. BECAUSE THE PROGRAM IS LICENSED FREE OF CHARGE, THERE IS NO WARRANTY FOR THE PROGRAM, TO THE EXTENT PERMITTED BY APPLICABLE LAW. EXCEPT WHEN OTHERWISE STATED IN WRITING THE COPYRIGHT HOLDERS AND/OR OTHER PARTIES PROVIDE THE PROGRAM "AS IS" WITHOUT WARRANTY OF ANY KIND, EITHER EXPRESSED OR IMPLIED, INCLUDING, BUT NOT LIMITED TO, THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE. THE ENTIRE RISK AS TO THE QUALITY AND PERFORMANCE OF THE PROGRAM IS WITH YOU. SHOULD THE PROGRAM PROVE DEFECTIVE, YOU ASSUME THE COST OF ALL NECESSARY SERVICING, REPAIR OR CORRECTION.
12. IN NO EVENT UNLESS REQUIRED BY APPLICABLE LAW OR AGREED TO IN WRITING WILL ANY COPYRIGHT HOLDER, OR ANY OTHER PARTY WHO MAY MODIFY AND/OR REDISTRIBUTE THE PROGRAM AS PERMITTED ABOVE, BE LIABLE TO YOU FOR DAMAGES, INCLUDING ANY GENERAL, SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES ARISING OUT OF THE USE OR INABILITY TO USE THE PROGRAM (INCLUDING BUT NOT LIMITED TO LOSS OF DATA OR DATA BEING RENDERED INACCURATE OR LOSSES SUSTAINED BY YOU OR THIRD PARTIES OR A FAILURE OF THE PROGRAM TO OPERATE WITH ANY OTHER PROGRAMS), EVEN IF SUCH HOLDER OR OTHER PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.
Now obviously one can argue that free software by nature shouldn't have a warranty, but that issue is irrelivent when it comes to the law. If we want this aspect of the GPL hold up in court, how can we argue against this recent descision? What if I charge a distribution fee for my GPL'ed software, does this mean that I'm lilable for the quality of that software? Some of use should calm down a bit before we are guilty of hypocracy.
Shouldn't a company be able to sell software with the understanding that there is no warranty? If I had over a million dollars relying on a piece of software, I'd go over the license with a fine tooth comb. Could it be that they just didn't want to pay for a higher quality product and a support contract, and they are just trying to screw the software writers now that it has blown up in their faces?
There, I said it. I feel dirty. Let the flames begin.
thePsychotron
Life is pain. Anyone who says otherwise is selling something.
I remember watching a PBS law special on this type of argument. The main argument was the liability of a "provider of goods" to the consumer. The main case-in-point was a gentleman who chipped his teeth on a pearl he found in an oyster. Should the proprieter of the restaraunt be held liable for any damages?
The argument, and the law, is this: The manufacturer/proprieter cannot be held accountable for any damages encurred from something one could reasonably expect in a good. So...can one reasonably expect bugs to be present in a given program? Unfortunately for the consumer...the answer is a resounding YES. The manufacturer's claim is furthered by the fact that the consumer, in this case, agreed to the terms of the software. While you may not, in a court of law, sign away your rights as a consumer, there is no constitutional, or otherwise, right to bug-free software.
caveat emptor!
FluX
After 16 years, MTV has finally completed its deevolution into the shiny things network
"It is seldom that liberty of any kind is lost all at once." -David Hume
How about if the OS has been documented by the producer admiting to the existance of oh, say 65000 bugs?
It seems that M$ reported 65,535 confirmed issues because anything higher than that would overflow the data type unsigned short. Sounds like they wrote their bug tracker with an old 16-bit DOS compiler. The scandiskers (can't say fsckers; this is M$) should have used this 32-bit compiler (a Free one at that) to make their bug tracker...
Will I retire or break 10K?
All I can say is "God, if only!" Our state supremes are elected -- although if you look at what the state of Washington has elected in the last few years, I don't think you'll see a lot of political influence from Microsoft, frankly.
What you need to realize is that the state of Washington, and the city of Seattle in particular, have a love-hate relationship with Microsoft. They're vaguely proud of us, in the same way that you might be proud of your dog after it turned over the picky neighbor's trash...on the one hand, you're glad to see the neighbor humiliated, but, on the other hand, you still think the mutt stinks.
To read the local press, we're the source of all evils locally. We're blamed for the "sudden" rise in housing prices in the city, for traffic on the 520 bridge, for the rise in crime, and for social injustice. Sometimes I'm surprised that we haven't been accused of having a role in the 1980 eruption of Mt. St. Helens!
The truth is that Microsoft is a small part of a very large city. Certainly, many of the company's employees are wealthy, but Seattle is still the center of the circles of power in the state. There just aren't enough of us to really throw our weight around.
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"The best we can hope for concerning the people at large is that they be properly armed." - Alexander Hamilton
They'd have to recall the product, fix it, and they'd be liable for damages to the person maimed. And if they said "this lawnmower is sold on the basis that if something goes wrong, it's not our fault" and tried to use that as an excuse, people would react with either outrage or downright laughter.
How could I be so stupid as to forget to include a license? Next time I write an open source project, please remind me to at least include a standard open-source license.
If anyone has a copy, can you please add an additional line at the top before redistributing it: "rem BY RUNNING THIS PROGRAM YOU AGREE TO DISCLAIM ALL LIABILITY FOR ANY DAMAGE CAUSED BY RUNNING THIS PROGRAM." Thank you, I love you!