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ALI Discusses Limited-Scope, Even-Handed Treatment Of Software Contracting Principles

Publication Date: 
June 21, 2007
Source: 
Patent, Trademark & Copyright Journal
Author: 
Joyce E. Cutler

Professor Mark Lemley is quoted extensively in this article about the American Law Institute's (ALI's) most recent attempt to produce a set of principles applicable to contracts involving computer software:

Mark A. Lemley, a law professor at Stanford University, worried that, because the draft does not take a position on forum selection, it will not provide needed direction on this issue.

"The draft punts an issue that has very seriously divided the courts and that whatever we want to come down will actually be helpful in providing more guidance,'' Lemley said. "A couple dozen cases are cited on whether consumer transactions that require people to travel out of state to litigate a case are in fact unfair or unreasonable. I think it would be useful to actually provide some more guidance than the mere word 'unreasonable' given that courts have not been able to provide it directly.''

Also unclear, Lemley said, is whether ALI intends to take a position on arbitration clauses. Whatever way ALI decides to go, the principles should address the issues, he said.

...

Lemley said he wished the principles were more illustrative about what types of browser wrap language are acceptable and what types are not.

Lemley told BNA that the principles "do kind of take some baby steps'' in situations in which consent to the terms is deemed to have been given by virtue of visiting a Web site.

"Under traditional terms of contract law that's not an agreement," he said. "But there have been some courts that have enforced those things. The principles as they are currently drafted shy away from saying those things are not enforceable but they seem to discourage those,'' Lemley said.

...

The principles apply to the transfer of software embedded in goods "if a reasonable transferor would believe the transferee's predominant purpose for engaging in the transfer is to obtain the software.''