LICENSING  INTELLECTUAL  PROPERTY
IN  THE  INFORMATION  AGE

(Second Edition)

By
Kenneth L. Port,  Jay Dratler, Jr.,  Faye M. Hammersley, Esq.,  Terence P. McElwee,
Charles R. McManis, and Barbara A. Wrigley

On-Line Problem Supplement
Copyright © 2005   Carolina Academic Press.   For permission, see CMI.
 

Chapter 8

Problem 10:  Mass-Market Software Licensing

Contair Corporation decides that a scaled-down version of VRS will have practical mass-market appeal for use in products other than automobiles.  Specifically, Contair has developed a new version of VRS that essentially takes the place of a computer keyboard.  It is designed to be compatible with the most popular operating systems and application programs.  Contair calls this product "VRS-Home."

Contair has developed the source code for VRS-Home but wants to keep the source code a trade secret.  Accordingly, just as it did for VRS, Contair has registered the copyright for VRS-Home under special regulations of the Copyright Office, which allow Contair to delete secret portions of the source code from the copies that Contair deposited with the Copyright Office for copyright registration.  Contair keeps the source code in secure computers on Contair's premises and uses passwords to restrict access to persons with a need to know.

Contair intends to market VRS-Home by licensing the object code (i.e., binary executable code) derived from the source code to consumer users for $100.  Contair wants its licenses to be available to users worldwide, and it intends to use "click-wrap" licenses available through Contair's website at the URL www.contair.com.  Contair wants the user to click "I agree" to the license before downloading the VRS-Home binary code from the website.

Contair would like the license agreement to serve all the following purposes: (1) to preserve its rights in the program; (2) to impose reasonable restrictions on use of the program and not to allow commercial use; (3) to prohibit modifying the program and merging it with other programs; (4) to keep the source code a trade secret; (5) to terminate the license upon the consumer's default; (6) to provide an express warranty that the program will work as described on the website for 90 days, but to disclaim any and all implied warranties to the extent permitted by law; (7) to limit liability for any reason to the price paid for the program; and (8) to the extent possible, to make the click-wrap version of the license enforceable worldwide.

Contair's website has strictly limited space, and the webmaster wants everything on the site to be as simple and brief as possible, so the license cannot exceed 500 words.  Please draft a license agreement meeting these requirements.  In a separate, shortparagraph at the end of the license, please explain how you would advise Contair to best make the license enforceable under the Uniform Electronic Transactions Act (UETA).

Back to Top