Master End-User License Agreement

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Master EULA Launched

Posted by meula on January 30, 2007

A EULA to govern all EULAs!

I was the guest lecturer (or “chatter”) today for a program on “DRM Technologies” presented by the Center for Intellectual Property of the University of Maryland University College. The audience included librarians and academics that are routinely presented with offers that were unheard of before the digital age: So-called “licensing” agreements governing what may and may not be done with copyrighted works.

Sometimes the licensing terms are positive, because they explicitly authorize the library to make a certain number of additional copies.  Other restrictions, however, are the sorts that intrude upon rights that are intended to lie beyond the control of the copyright owner. To impose attempt to impose them by agreement leaves open the possibility of breeching the agreement or negotiating different terms, but modern technology also allows for the technological enforcement of terms that the copyright owner is able to impose by code, unilaterally, and without requiring any agreement.

These unilateral restrictions imposed by software are often referred to as DRM (digital rights management) or TPM (technological protection measures). Like EULAs, they may be good (helpful in streamlining the legitimate exploitation of the copyright), bad (cumbersome but perhaps, on balance, positive), or ugly (so lacking in any redeeming value that they should be outlawed as restraints on trade, misuse of copyrights, and restrictions on freedom of speech).  See John Mitchell, DRM: The Good, the Bad and the Ugly.

The courts have been slow to recognize abuses of TPM, and perhaps with good reason: Few cases make their way that far. Law enforcement (particularly the Department of Justice’s Antitrust Division and the Federal Trade Commission) sometimes appears impotent to grasp how fundamentally different must be the antitrust, competition and consumer protection analyses be when applied to copyrighted works and the actions of copyright holders in leveraging their copyrights to suppress competition and extract greater “value” from the consumer at the expense of fundamental rights. (The Register of Copyrights, in turn, appears to have little or no appreciation for antitrust, competition or consumer protection law.)

The MEULA project takes a different approach than evaluation and condemnation of overreaching EULAs. Taking a page from EULAs themselves, it empowers consumers and businesses that are the recipients of EULAs to make prophylactic use of the same legal strategy by being prepared to receive each offer of a EULA under a pre-existing framework for containing EULAs to their reasonable and lawful uses.

The MEULA intends no commentary on the legitimacy of EULAs as a form of contracting. Courts have split on the issue of shrink-wrap and click-wrap agreements. Some lower courts have gone so far as to split with the Supreme Court on the effect of mere notices placed on a product by the copyright owner, which have the effect of nullifying statutory rights of users. Rather than engage in further debate on these cases, this MEULA takes the approach that if it is good enough for the licensor to offer to the licensee, it is good enough for the licensee to anticipatorily offer it to the licensor.

Substantively, the approach is simple, as the MEULA rests on these principles:

First, the parties should respect copyright law.
The MEULA provides that nothing in the EULA shall enlarge the scope of the licensor’s rights beyond the limits of Section 106 of the Copyright Act.
For example, since no copyright owner has the exclusive right to perform a work privately (to read a book, watch a movie, listen to music, view a painting), any EULA terms purporting to give the copyright owner control over such activities is null and void.

Second, the parties agree not to circumvent the copyright law’s limits.
The MEULA provides that nothing in the EULA shall derogate from the limitations on the copyright set forth in Sections 107-122 of the Copyright Act.
For example, Section 107 provides that all copyrights are subject to the right of anyone to make fair use of a work, so no EULA provision may impair the right of fair use. Similarly, Section 109 entitles the owner of a lawfully made copy to sell it over the objection of the copyright owner. Therefore, any EULA term that would impair the right of the owner to re-sell a lawful copy is null and void.

Third, the parties agree on the separation of the intangible “work” from the tangible copy of the work, as provided in Section 202 of the Copyright Act.
The MEULA provides that nothing in the EULA shall impair the unrestricted re-distribution of a lawfully made copy (with minor exceptions pertaining to certain rentals).
For example, since the owner of a lawfully made copy of a movie is entitled to rent it without the consent of the copyright owner, any EULA term purporting to limit that right would be null and void. Or, more positively, the MEULA authorizes the owner of a lawfully made copy to remove or revise labeling that would tend to impair the enjoyment of the Section 109 right, such as a label on a movie that says “not for rental” despite the fact that renting it infringes no copyright.

Finally, the parties agree to abide by the spirit of the WIPO (World Intellectual Property Organization) treaties upon which the United States Digital Millennium Copyright Act’s anti-circumvention provisions were based.  The WIPO treaties obligate signatory parties to provide protection against circumvention of technological measures to gain access that is not (a) authorized by the copyright holder or (b) authorized by law.  At the urging of powerful copyright holding companies, the DMCA went much further than necessary to comply with such treaty obligations, and completely omitted the WIPO treaty “safety valve” for lawful, non-infringing uses “authorized by law,” even if not authorized by the copyright owner.
The MEULA would make the DMCA consistent with the international uniform plan envisioned in the WIPO treaties, and prevent Americans from becoming second class world citizens when it comes to accessing works of authorship by preemptively authorizing the user to circumvent any TPM to the extent necessary to continue to enjoy a use “authorized by law.”
For example, one copyright owner marketed DVDs of its movies that would self-destruct after a few hours, thereby preventing the owner from exercising its right under Section 109 to lend, sell, rent, or give away the copy, and destroying competition from secondary markets for the DVDs (used, rentals, barter, gifts). The scheme also enabled the copyright owner to seize control over private performances despite such control being denied to the copyright owner by law. The MEULA authorized the circumvention of the TPM to the extent necessary to enjoy the Section 109 rights and continue to enjoy private performances of the work from the DVD.

Enough for the first post! I intend to flesh out the details over time and, with helpful advice from readers like you, refine the MEULA.  I have begun with this Alpha version, which is intended for constructive criticism and comment. Fire away – not only on the substance of the rights but also on the mechanism for enhancing its enforceability.


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