(Originally published as "Shrinkwrap Licenses: An Epidemic Of Lawsuits Waiting To Happen" in InformationWeek, February 3, 2007)
READ CAREFULLY. By reading this article, you agree, on behalf of your employer, to release me from all obligations and waivers arising from any and all NON-NEGOTIATED agreements, licenses, terms-of-service, shrinkwrap, clickwrap, browsewrap, confidentiality, non-disclosure, non-compete and acceptable use policies ("BOGUS AGREEMENTS") that I have entered into with your employer, its partners, licensors, agents and assigns, in perpetuity, without prejudice to my ongoing rights and privileges. You further represent that you have the authority to release me from any BOGUS AGREEMENTS on behalf of your employer.
READ CAREFULLY -- all in caps, and what it means is, "IGNORE THIS." That's because the small print in the clickwrap, shrinkwrap, browsewrap and other non-negotiated agreements is both immutable and outrageous.
Why read the "agreement" if you know that:
1) No sane person would agree to its text, and
2) Even if you disagree, no one will negotiate a better agreement with you?
We seem to have sunk to a kind of playground system of forming contracts. There are those who will tell you that you can form a binding agreement just by following a link, stepping into a store, buying a product, or receiving an email. By standing there, shaking your head, shouting "NO NO NO I DO NOT AGREE," you agree to let me come over to your house, clean out your fridge, wear your underwear and make some long-distance calls.
If you buy a downloadable movie from Amazon Unbox, you agree to let them install spyware on your computer, delete any file they don't like on your hard-drive, and cancel your viewing privileges for any reason. Of course, it goes without saying that Amazon reserves the right to modify the agreement at any time.
The worst offenders are people who sell you movies and music. They're a close second to people who sell you software, or provide services over the Internet. There's a rubric to this -- you're getting a discount in exchange for signing onto an abusive agreement, but just try and find the software that doesn't come with one of these "agreements" -- at any price.
For example, Vista, Microsoft's new operating system, comes in a rainbow of flavors varying in price from $99 to $399, but all of them come with the same crummy terms of service, which state that "you may not work around any technical limitations in the software," and that Windows Defender, the bundled anti-malware program, can delete any program from your hard drive that Microsoft doesn't like, even if it breaks your computer.
It's bad enough when this stuff comes to us through deliberate malice, but it seems that bogus agreements can spread almost without human intervention. Google any obnoxious term or phrase from a EULA, and you'll find that the same phrase appears in a dozens -- perhaps thousands -- of EULAs around the Internet. Like snippets of DNA being passed from one virus to another as they infect the world's corporations in a pandemic of idiocy, terms of service are semi-autonomous entities.
Indeed, when rocker Billy Bragg read the fine print on the MySpace user agreement, he discovered that it appeared that site owner Rupert Murdoch was laying claim to copyrights in every song uploaded to the site, in a silent, sinister land-grab that turned the media baron into the world's most prolific and indiscriminate hoarder of garage-band tunes.
However, the EULA that got Bragg upset wasn't a Murdoch innovation -- it dates back to the earliest days of the service. It seems to have been posted at a time when the garage entrepreneurs who built MySpace were in no position to hire pricey counsel -- something borne out by the fact that the old MySpace EULA appears nearly verbatim on many other services around the Internet. It's not going out very far on a limb to speculate that MySpace's founders merely copied a EULA they found somewhere else, without even reading it, and that when Murdoch's due diligence attorneys were preparing to give these lucky fellows $600,000,000, that they couldn't be bothered to read the terms of service anyway.
In their defense, EULAese is so mind-numbingly boring that it's a kind of torture to read these things. You can hardly blame them.
But it does raise the question -- why are we playing host to these infectious agents? If they're not read by customers or companies, why bother with them?
If you wanted to really be careful about this stuff, you'd prohibit every employee at your office from clicking on any link, installing any program, creating accounts, signing for parcels -- even doing a run to Best Buy for some CD blanks, have you seen the fine-print on their credit-card slips? After all, these people are entering into "agreements" on behalf of their employer -- agreements to allow spyware onto your network, to not "work around any technical limitations in their software," to let malicious software delete arbitrary files from their systems.
So far, very few of us have been really bitten in the ass by EULAs, but that's because EULAs are generally associated with companies who have products or services they're hoping you'll use, and enforcing their EULAs could cost them business.
But that was the theory with patents, too. So long as everyone with a huge portfolio of unexamined, overlapping, generous patents was competing with similarly situated manufacturers, there was a mutually assured destruction -- a kind of detente represented by cross-licensing deals for patent portfolios.
But the rise of the patent troll changed all that. Patent trolls don't make products. They make lawsuits. They buy up the ridiculous patents of failed companies and sue the everloving hell out of everyone they can find, building up a war-chest from easy victories against little guys that can be used to fund more serious campaigns against larger organizations. Since there are no products to disrupt with a countersuit, there's no mutually assured destruction.
If a shakedown artist can buy up some bogus patents and use them to put the screws to you, then it's only a matter of time until the same grifters latch onto the innumerable "agreements" that your company has formed with a desperate dot-bomb looking for an exit strategy.
More importantly, these "agreements" make a mockery of the law and of the very idea of forming agreements. Civilization starts with the idea of a real agreement -- for example, "We crap here and we sleep there, OK?" -- and if we reduce the noble agreement to a schoolyard game of no-takebacks, we erode the bedrock of civilization itself.
Eric von Hippel
Erik S. Raymond