IP Blog
Software Licenses
With License Ambiguous, Patent Exhaustion Heads to Jury
In Audio MPEG, Inc. v. Dell Inc., the Eastern District of Virginia denied summary judgment of patent exhaustion because it was ambiguous whether a license between Audio MPEG and Dell’s supplier Microsoft covered the allegedly infringing software, leaving the issue to the jury. Audio MPEG asserted that Dell’s sales of computers infringed three of its patents on encoding and decoding...
A Reminder That Website Agreements Are Usually Enforceable
Long before the Internet, courts were not reluctant to enforce adhesion contracts. This willingness is one thing the Internet age has not changed. A good reminder – and lessons for parties seeking to enforce, as well as users wary of, website agreements – comes in a recent case in which a U.S. district court enforced a rather draconian transfer of...
Online Terms and Conditions Are Usually Enforceable
Many commercial transactions are governed by online terms and conditions provided by one party, to which another party may be bound even if provided only with a reference or link to the online terms and conditions. This truth is illustrated by the recent case of Tuscany S. Am. v. Pentagon Freight Sys., No. 4:12-CV-1309 (S.D. Tex. Sept. 24, 2014). In...
Software Licensee's Creation of Derivative Work Results in an Injunction
In case you doubted it, seemingly boilerplate provisions in software license agreements that prohibit the creation of derivative works do mean something, as exemplified in EyePartner, Inc. v. Kor Media Group LLC, No. 4:13-10072 (S.D. Fla. July 15, 2013). The court in this case granted a preliminary injunction based on such an anti-modification provision, as well as on the anti-circumvention...
Use of Software After Expiration of License Is Copyright Infringement
A software owner was granted summary judgment of copyright infringement where its licensee had breached the applicable software license agreement, and continued to use the software after the agreement expired. Clinical Insight v. Louisville Cardiology Med. Group, No. 11-CV-6019T (W.D.N.Y. July 12, 2013). The licensee could not be saved by its allegation that it had stopped paying license fees because...
Enforcement of a Click-wrap License Agreement
Consumers who casually, even blindly, accept “click-wrap” or “browse-wrap” license agreements will be bound by those agreements so long as the user had a reasonable opportunity to accept or reject the proffered license. A recent case provides a blueprint for how to offer, and then how to enforce, a click-wrap agreement. In Zaltz v. JDate, No. 12-CV-3475 (JFB) (ARL) (E.D.N.Y....
Software Copyright Infringement Defenses: Ownership of a Copy and Implied License
A defendant accused of infringing a software copyright was, according to facts plead in the plaintiff’s complaint, an owner of a copy of the software under 17 U.S.C. § 117(a)(1). Further, the facts established that the defendant had an implied license. Therefore, the court in Zilyen, Inc. v. Rubber Mfrs. Ass’n, No. 12-0433 (RBW) (D.D.C April 2, 2013), granted the defendant’s motion...
Software Licenses and Allocating Risk of Data Loss
The Utah Supreme Court has held that a software vendor is not liable for any damages after its software caused a dentist to lose all of his patient data. In Blaisdell v. Dentrix Dental Systems, Inc., No. 20100392 (Utah S. Ct. June 26, 2012), the court held that a limitation of liabilities provision was enforceable in the face of (1)...
That Forum Selection Clause in Your Software License Matters
Here is a story to tell clients wondering why you are negotiating so hard over a seemingly mundane forum selection clause. An Illinois court, swayed in part by the fact that a paper software license had also been presented in a click-wrap agreement, enforced a forum selection clause in the license agreement that the plaintiff-licensee had contended was unenforceable and...
Defining the Scope of a Perpetual Software License
A perpetual software license entitled a licensee only to use versions of the software created before the license agreement terminated, despite the existence of an escrow agreement requiring the deposit in escrow of “all updates” and “all revisions” of the software’s source code. Gene Codes Forensics Inc. v. The City of New York, No. 10 Civ. 1641 (S.D.N.Y. April 26,...