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EULAs: Fruit of the Poisonous Tree
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EULAs: Fruit of the Poisonous Tree


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  • 1. The EULA: A Poisonous Tree
  • 2. HI! My Name isPeter “Deuce” Bradshaw I’m writing a paper about EULAs
  • 3. I want to share my work and research. Continue theConversation with me Via Twitter: @BradshawLaw
  • 4. What is a EULA?
  • 5. EndUserLicenseAgreement
  • 6. Contract between licensor and purchaser, establishing purchaser’sright to use the software.
  • 7. Usually unseen until After purchase and Assented to by clicking “I Accept”
  • 8. Objective Theory ofContracts
  • 9. existence of a contractis determined by the legal significance of the external acts of a party, rather than by the actual intent.
  • 10. In other words clicking “I Accept”
  • 11. Contracts ofAdhesion
  • 12. Standard forms, included in the packaging or installation materials for software or licenses for information other party has no real bargaining powerThe non drafting party often would not understand the language even if the contract was read terms are defined by the drafting partyReflects interests of the party with superior bargaining power, likely to be the drafting party Presented on a "take-it or leave-it" basis with no negotiation
  • 13. BLanketAssentTheory
  • 14. No assent to any specific terms. bRoad assent to the transaction to any NON-unreasonable terms that do not alter these reasonable expectations as to the terms of the transaction.
  • 15. Prominent Eula Cases
  • 16. 1990 Congressional amendment to First Sale Doctrine 1991 Step-Save Data Systems, Inc. v. Wyse Technology 1996 ProCD v. Zeidenberg 1998 Hotmail Corp. v. Van$ Money Pie Inc. Groff v. Am. Online, Inc 2002 Comb v. PayPal, Inc., 2003 Bowers v. Baystate Techs., Inc,.
  • 17. 1991Step-Save Data Systems, Inc. V. Wyse Technology Unfair to bind buyer because seller sent last form UCC 2-207 Approach should COntrol: Parties only Intended to Incorp. Terms which both Parties agreed
  • 18. 1991ProCD v. Zeidenberg “Agreement” specifically limited the use of the application program and listings Zeidenberg argued that this was a “non-Agreement” License appeared in 3 forms: Packaging; Text in the manuaL; Text displayed each time software loaded
  • 19. 1991ProCD v. Zeidenberg (Continued) UCC 2-204 controls: “Any manner sufficient to Show Agreement.” Accepted terms by not returning disks “Shrinkwrap licenses enforceable unless terms are objectionable on grounds of general contract law
  • 20. 1991ProCD v. Zeidenberg (Continued) Case NOT decided on clickwrap grounds, but rather on Shrinkwrap UCC 2-204 invocation set groundwork for clickwrap
  • 21. 1998Hotmail v van$ money pie Pornography and Spam messaging against user agreement Grant of Injunction without discussion of assent or enforceability Passively acknowledging the legitimacy of clickwrap
  • 22. 1998Groff v America online inc. Forum selection clause Grant of aol motion to dismiss for improper venue User had ability to decline the terms acknowledging the legitimacy of Accept or Decline
  • 23. 2002Comb v. paypal inc. Procedural unconscionability Even where Acceptace is procedurally lacking, still enforceable if the substantive terms are Reasonable
  • 24. 2003Bowers v. bayside techs inc. Copyright & Agreement contract claims are preempted if the work is within the subject matter of copyright courts typically find that contractural rights are not equivalent to copyrights
  • 25. Collision Of CopyRight EULA Cases
  • 26. 1984 Sony Corp v. Universal City Studios, Inc. 2003 Chamberlain v Skylink Technologies 2004 LexMark Cases 2005 Blizzard I 2008 Blizzard II RealNetworks, Inc. v. DVD 2009 Copy Control Ass’N Inc.
  • 27. 1984Sony Corp v. Universal City Studios, Inc. BetaMax Case. EStablished fair use doctrine as a check to the "monopoly privileges" provided by Congress Created Market for Retail Movie Releases
  • 28. 2003Chamberlain v. Skylink Technologies Garage Door Openers Warranty and Website Did Not Explicitly Bar the Plaintiff’s Use Sellers Can dictate terms for consumer use
  • 29. 2004Lexmark Cases Printer Cartridges lexmark cartridges encrypt authentication secquenceProphecized: Manufacturers Would lockdown devices through a combination of copyright and contract
  • 30. 2005Blizzard IAlternate servers for playing Warcraft Defendant contractually yielded right to reverse engineer Holding based on bowers
  • 31. 2008Blizzard II World of Warcraft “bot” Analysis Similar to blizzard I in analysis and holding
  • 32. 2009 Realnetworks, Inc. v. Dvd copy control assn. Inc DVD Copying SoftwareHeld that Realnetworks could not prove that its product would not be used for illegitimate purposes High threshold requirement for creators of software
  • 33. Eulas include restrictive termson purchasers that were not assented to by that purchaser
  • 34. Allowing content creators and manufacturers to step into the role of legislators
  • 35. These Contracts of Adhesion should be treated as poisonous Trees
  • 36. For the Protection of Consumers EULA Terms should be Held inherently unconscionable until the drafting party demonstrates their Reasonableness
  • 37. PHOTO CREDIT Title Slide Neil Kandalgaonkar