Summary Report of UCITA Activities
January 25, 2003
Growing opposition to UCITA within NCCUSL, but UCITA continues for the time being.
In the July 23, 2001 ALAWON, The ALA Washington Office announced that:
“In a proposed formal resolution that will be considered shortly, the Tort and Insurance Practice Section (TIPS) of the ABA has recommended that the ABA House of Delegates vote to oppose the adoption of UCITA anywhere. ( http://www.abanet.org/tips/ucita/home.html) The proposed resolution further recommends that NCCUSL withdraw and extensively revise UCITA "to more adequately reflect the current state of the law concerning the licensing of intellectual property with due regard for basic rights of consumers and the protection of Licensees from unwarranted unilateral actions of the Licensor." (The proposed resolution can be found on http://WWW.ABANET.ORG/TIPS/UCITA) TIPS and others in the ABA also have asked that NCCUSL agree to stand down from pursuing any state legislative action during the period of review and redrafting, on which the ABA would work with NCCUSL”.
At the American Bar Association Annual meeting in Chicago August 2?8. The Association postponed a vote to oppose the Uniform Computer Information Transactions Act and instead established a task force to examine the strengths and weaknesses of the legislation. The task force is charged with finding out if there is a way to work out differences of interpretation in the proposed law. http://www.ala.org/alonline/news/2001/010813.html NCCUSL agreed not to pursue state legislative action during the review period, but this does not keep major players such as Microsoft or AOL from pressing the states for passage.
Members of the NCCUSL UCITA Standby Committee met with the ABA Advisory UCITA Working Group Novemebr 16?18, 2001 at the Omni Shoreham Hotel in Washington, D.C. Materials pertinent to the meeting, including the Cover Letter and 39 amendments proposed by AFFECT and a letter signed by 32 States Attorneys General and the Attorneys General of 2 US Territories opposing UCITA can be found at: http://www.nccusl.org/nccusl/meetings/ucita_1101materials.htm A total of more than 70 amendments were introduced for consideration at this meeting.
A January 4, 2002 news release by AFFECT states that “The Standby Committee of the National Conference of Commissioners on Uniform State Laws (NCCUSL) released 19 proposed amendments to UCITA in late December.... the proposed amendments fall far short of what is necessary to resolve the many issues of controversy. The proposed amendments give the appearance of compromise, without the substance of compromise.... The amendments recommended by the Standby Committee provide no relief on some critical issues.... Overall, the 19 proposed amendments fail to address adequately the broad range of concerns uniting the AFFECT membership.... AFFECT continues to believe that UCITA proponents have failed to justify the need for such a sweeping and complex law that still clearly favors the software and information industries.... The proposed amendments appear to be a last?ditch effort of the Standby Committee to salvage UCITA. ”
Shortly after NCCUSL released their 19 proposed amendments, the ABA Working Group met to consider NCCUL’s proposed amendments. The AFFECT web site http://www.affect.ucita.com/pres_rel_021102.html summarizes the ABA Working Group Report as follows:
In January the ABA Working Group reported that UCITA was so flawed it “would not achieve the principal objective that a uniform law is supposed to achieve, namely, the establishment of a high level of clarity and certainty.”
The ABA Working Group also took issue with the confusing and often contradictory text of the proposed law, stating UCITA is ‘daunting even for knowledgeable lawyers to understand and apply.” The working group’s report predicts UCITA would continue to generate controversy that would only be resolved by litigation and recommends the act be completely redrafted.
In May, 2002, AFFECT released an extensive detailed response to the 19 NCCUSL amendments. This report is available at: http://www.affect.ucita.com/pdf/AFFECTresponse5-15-02.pdf
Further, the ABA report criticized UCITA’s encouragement for a licensor’s withholding of terms until after purchase. The group’s report was signed by eight of its nine members.
At NCCUSL’s annual meeting, July 26-August 2, 2002 growing opposition to UCITA resulted in some commissioners starting a petition to downgrade UCITA from a uniform law to a model act. The petition was deemed premature, but the NCCUSL leadership indicated that if there was no progress on moving UCITA forward this year “a different approach to the matter will have to be taken.”
While NCCUSL adopted a number of changes recommended by the ABA UCITA Working Group, it rejected changes in crucial areas. AFFECT expects continued opposition to UCITA from a wide group of interests, including ABA, consumer groups, manufacturing businesses, financial services institutions, technology professionals and libraries.
Two crucial amendments to UCITA were rejected by NCCUSL; to require disclosure of the terms of a contract before a licensee becomes obligated to pay; and to exclude from UCITA software that is ‘embedded in and marketed as an integral part of the goods.’ In addition, NCCUSL failed to take meaningful action relating to making UCITA easier to understand and to use. AFFECT states that “These most recent changes by NCCUSL do not significantly improve the law and AFFECT thus remains committed to opposing further enactment of UCITA.”
Affect continues to maintain that the modification adopted by NCCUSL do not significantly change UCITA. A proposal by proposal commentary can be accessed at: ( http://firstname.lastname@example.org/pdf/AmendmentAnalysisFinal.pdf)
Following NCCUSL’s annual meeting, AFFECT wrote an open letter to the president and house of delegates of the American Bar Association urging them not to lend support to UCITA By not downgrading UCITA from a uniform law to a model act, NCCUSL continues to place UCITA before the ABA for consideration. The growing dissatisfaction with UCITA, even within NCCUSL, and NCCUSL’s failure to incorporate in a meaningful way the amendments suggested by the ABA UCITA Working Group, is the basis for AFFECT’s request to the ABA.
Another indication that NCCUSL is moving away from UCITA is the organizations return to the UCC Article 2. Article 2 governs transactions in goods, and has been used in litigation over software. The new language of Article 2 rejects the language or terminology of UCITA such as “computer information.” Goods is redefined here to exclude “information.” The term “information” is left undefined, leaving it to the courts to determine. AFFECT would prefer language that would specify the legitimate needs of customers of software and digital content, balancing them with the needs of producers, but prefers the new language of Article 2 to UCITA.
The new language of UCC Article 2 now goes to the American Law Institute for consideration. NCCUSL and ALI need to agree on language before it is included in the Uniform Commercial Code. ( http://email@example.com/pdf/ABAletter.pdf )
On a related issue, AFFECT opposed a change to UCC Article 1 language that would allow a licensor to choose the law of any state they wish to apply to the software license in “click through” licensing.
For more information and detail on these events please see the following sources:
AS UCITA APPROVAL LAGS, ABA EDGES TOWARD NO STANCE, DRAFTERS PLAN NOVEMBER MEETING
Pike & Fischer’s Internet.Regulation.Alert
exclusive weekly news on the coming cyberspace regulation revolution
Vol. 3, No. 29 — July 27, 2001 p.6
AFFECT: What’s Happening
NCCUSL News Release on the Nov. 16-18, 2001 meeting:
Materials in preparation for the Nov. 16-18, 2001 NCCUSL/ABA Meeting :
Massachusetts NCCUSL Commissioner Stephen Y. Chow's letter to the Attorneys General
(Chow is one of only two commissioners opposed to UCITA, his letter is very telling and disturbing.)
A state by state accounting of UCITA legislative activities can be accessed at the ALA UCITA web page: http://www.ala.org/washoff/ucita/news.html
RUSA/ILL/MOUSS UCITA Working Group:
Rick Uttich (chair)
Margaret Ellingson firstname.lastname@example.org
Nada Vaughn email@example.com
Charlotte Dugan firstname.lastname@example.org
Emaly Conerly* email@example.com
Russell Palmer firstname.lastname@example.org
Mary Wilke email@example.com
Kay Vyhnanek* firstname.lastname@example.org
Cindy Kristof email@example.com
Tom Delaney* firstname.lastname@example.org