Uniform Computer Information Transaction Act - Coursework Example

Uniform Computer Information Transaction Act (UCITA) Uniform Computer Information Transaction Act (UCITA) College Subject Abstract The Uniform Computer Information Transaction Act which tries to safeguard the software developers from the theft or copying by pirates by finding solutions among contradictory software licensing regulations, which differ from state to state in USA as of date. UCITA tries to provide a uniform provision which is applicable to all the states in USA. However, there are severe criticism against UCITA from the drafting stage itself and only two states have implemented in their act. UCITA is inherent with many anomalies and limitations which have to be addressed else its future in the USA seems to be very bleak. Uniform Computer Information Transaction Act (UCITA) There are a number of litigations that are plaguing around software sales, information sales and internet sales. For sale of goods, Article 2 of UCC safeguards the interests of the consumers against exploitation by manufacturers. Likewise, there should be a uniform law that should govern the contract pertaining to software, internet sales. Further, the law should be analogues and should not be different in Virginia or Kentucky. The result is the Uniform Computer Information Transaction Act which tries to safeguard the software developers from the theft or copying by pirates by finding solutions among contradictory software licensing regulations, which differ from state to state in USA as of date. I. History of the Uniform Computer Information Transaction Act (UCITA) The Uniform Computer Information Transactions Act (UCITA) prescribes regulations for licensing computer information and allied contracts in the states. Under the above act, transactions like contracts pertaining to access to computer programs, online databases and processing of data are being covered. Despite stiff oppositions from Attorney-General’s of 26 states in US and various bodies, the above bill was voted by NCCUSL on 29 July 1999. The law is proposed to offer safeguard to all e-commerce transactions as how (Uniform Civil Code) protects the interest of consumers when they buy products in the market. UCITA is specifically drafted to offer a safeguard to e-commerce transactions like UETA (Uniform Electronic Transactions Act) which safeguards non-UCITA and non-UCC transactions, Article 8 of UCC safeguarding holding of securities and Article 5 of UCC safeguarding the electronic LC (Letters of Credit). Though, the UCITA tries to protect the e-commerce transactions in a piecemeal way but core issues to e-commerce transactions like online information transactions have not been codified clearly in it now. The main objective of the UCITA is to prescribe regulations and rules to administer commercial transactions through information technology and to offer concise and clear governing law to be applicable to the e-commerce transactions. Hence, there is a necessity to make appropriate enactment in the states of uniform law footed upon their contract law. There was stiff opposition from American Law Institute for the scope and wording of proposed Article 2-B, and it withdrew from drafting process. Undiscouraged by this, the NCCUSL progressed independently and removed the draft Article 2-B from the UCC and alternatively, recommended it to states as a stand-alone law, rechristened it as UCITA. The first state to adopt UCITA is Virginia followed by Maryland. Other states are in the process of introducing the bills in their legislature to enact UCITA or giving much consideration for its enactment in the near future. (Marke, Sloane & Ryan, 1990, p.23-71). Considering the UCITA as controversial, North Carolina, Iowa, Idaho, West Virginia, New York and Vermont have introduced or passed law declining to apply UCITA provisions to contract with their residents. There was a stiff opposition from AMA (American Bar Association) as it recommended that UCITA should be redrafted. Despite widespread criticism and opposition, there is a need for a uniform legislation and the effect of UCC in USA, UCITA may yet turned to be a crucial basis for interpretation and elucidation of digital licensing contracts not only in USA but in other parts of the globe. It is to be noted that UCITA symbolizes a vital attempt to address the various issues relating to computer transactions and content licensing. (Bates, 2011, p.216). II. “Positions of the states for the Uniform Computer Information Transaction Act (UCITA)” States in USA may support the UCITA on the following grounds. One of the main objectives of UCITA is to provide a set of common and unified set of regulations for online sales contracts and wants to minimise the time and resources spent on litigations due to issues in the online contracts. It is argued by the supporters that UCITA offers uniformity in all the states as regards to e-commerce. The Act has enumerated regulations that administer electronic transactions establishing uniformity across the nation and help to reach accord between the business and consumers. UCITA will facilitate small businesses across USA to enter into e-commerce transactions in all the fifty states without having to perform research on electronic contract regulations that may differ from state to state. UCITA is likely to bring down the number of litigations in e-commerce transactions as the interpretation of uniform law will be much easy and less cumbersome. (InfoWorld, 2000, p.73). A very liberal contract formation is allowed under Section 202 of the UCITA. It permits that a contract may be concluded in any style adequate enough to demonstrate an agreement which includes demeanor of parties, offer and acceptance and functioning of electronic agents. UCITA also exclusively allows mass market licenses like “click-wrap” or “shrink-wrap” and mass market licenses do not have negotiated agreements. UCITA also offers some regulations for pre-transaction disseminations in internet-transactions that include the supply of information about software or product. §211(1) of UCITA specifically provides that a licensor should make available standard terms for evaluation of the conditions and terms of the license before the requirement to pay or before delivery whichever happens first. A contract in silence cannot be concluded under UCITA. UCITA also allows the court to annul a term that supposes to be part of a license if it is unacceptable, or if it is one-sided. UCITA also provides that there should be some remedies available to licensors. Supporters are of the view that UCITA would offer more advantage to the community by making non-free software available freely and make unbearably provisional in nature thereby compelling end-users at the mercy of the software developers. (GNU 2012). UCITA offers a major advance to the end-user to reject the software if it has bugs that stop it from catering the performance norms. Immediately, after the cancellation of such contract, the affected party is needed to adhere to the licensor’s conditions as regards to the software. Unlike the UCC, the UCITA permits to claim liquidated damages in case of injury. It also permits the parties to modify, substitute or make some additions to reliefs that it offers. Unless the exclusion or limitation or unconscionable, the licensor may restrict or exclude incidental or consequential damages. (Delta & Matsuura, 2008, p.13.108). III. “Positions of the states against Uniform Computer Information Transaction Act (UCITA)” AFFECT (Americans For Fair Electronic Commerce Transactions) has criticized the UCITA heavily and demanded that the information economy should be competitive and fair. It was alleged by the critics that UCITA throws a direct threat to the American economy by according the licensor or the software manufactures exceptional control over their products without seeing that enough safeguard has been accorded to the end-users or licensees. Some critics argue that UCITA is a one-sided act as it offers only two options namely take it or leave it to end-users and licensees. Some critics were of the opinion that the UCITA facilitates the vendors to shun the impact of copyright law, which includes the fair usage of information and the capability to transfer copies. Critics are of the opinion that UCITA authorizes a “click-on” or “shrink-wrap” approach to electronic licensing and hence, copyright law, consumer protection and privacy protections would be surpassed by the “click-on” contract as advanced by UCITA. (Marke, Sloane Ryan, 1990, p. 23-72). Critics are of the view that UCITA makes a software distributor as accountable or a developer for flaws in a software program whereas it permits a click-on license to overcome any such default. Thus, companies like Microsoft, Oracle who uses shrink –wrap licenses to shun liability altogether. Further, it is alleged that UCITA offers proprietary software developers the authority to forbid reverse engineering, and they can create a secret file protocols and formats, which would be difficult for others in a lawful way to find out such secret protocol. (GNU 2012). It is alleged that UCITA facilitate the online publishers to inflict limitations on the internet savvies as the internet publisher can transform the license conditions with the retrospective effect and will compel the users to delete the free materials if one do not acknowledge such change.(GNU 2012). The most controversial feature of the UCITA is the reliefs that it allows in part 8 of the section 801(a) which explains that reliefs available under UCITA are cumulative in nature, and the distressed party cannot recover more than once for the same injury. An aggrieved party can seek damages or claim from the licensor in addition to recession of contract or declining to return the information already enjoyed.(Delta & Matsuura ,2008,p.13.107). The remedies available under UCITA are enforceable by judicial process, and the same is famously known as “electronic self-help”. However, critics are of the opinion that the electronic self-help is the most controversial feature of the UCITA. (Delta & Matsuura, 2008, p.13.108). IV. “Future of the Uniform Computer Information Transaction Act” Out of 50 States in USA, only Virginia and Kentucky states have adopted the UCITA as on date. In other words, there is stiff opposition from the remaining 48 States to implement UCITA. This itself demonstrates how serious the issue is. UCITA has many drawbacks. As regards to the length of the acquirer’s right to use the software, there is no timeframe set out in UCITA. It authorises the licensors to deny access to the software operating from remote places without accessing to court or without any order from court. UCITA does not allow transfer of software from one company to another in case of acquisition or merger or by way of gift to one person to another. It permits the licensors to shun any accountability for damage caused due to defective products .UCITA facilitate the licensor to stop criticism about their product. It facilitates the vendors of software to obstruct the evolution of innovative product and to collect the confidential data about consumer licenses and client’s business. It denies the end-users to know the terms and conditions of the contract before making any payment and also permits the licensors to alter the conditions of the contract one-sidedly through e-mail. It is pro licensor as it does not allow any negotiation between parties and impose preconditions on the buyer. It facilitates the licensors to take the benefit of loopholes to decide where legal issues are to be resolved thereby shifting the venue to the vendor states thereby refusing to litigate in the buyer’s state. As the disadvantages outweigh the benefits, UCITA needs either a complete overhaul or revamping. Unless or otherwise, such disadvantages are not addressed, the future of the UCITA seems to be bleak as only just two states have espoused the UCITA in USA as of date even after 13 years have lapsed from its introduction. References Bates, MJ. (2011). Understanding Information Retrieval System. New York: CRC Press. Delta, GB & Matsuura, JH. (2008).Law of the Internet, Volume 2. New York: Aspen Publishers Online. GNU (2012). Why We Must Fight UCITA? Retrieved December 8, 2012, from http://www.gnu.org/philosophy/ucita.html Huggins, J.S. (2012). UCITA. Retrieved December 8, 2012, from http://www.jamesshuggins.com/h/tek1/ucita.htm InfoWorld. (2000, January 10). UCITA Threatens the Rights of Consumers. InfoWorld, 22(2), 73. Marke, JJ, Sloane R &Ryan L. (1990). Legal Research and Law Library Management. New York: Law Marke, Sloane Ryan Journal Press. Read More