James S. Huggins' Refrigerator Door: Click here to go to my Home Page. ucita, uniform computer information transactions act, american committee on interoperable systems, acis, ucita, uniform computer information transactions act, american committee on interoperable systems, acis, qwerty
. Letter from American Committee for Interoperable Systems (ACIS) to Article 2B Drafting Committee Opposing UCC 2B

October 7, 1998

 

Mr. Connie Ring
Chair, UCC Article 2B Drafting Committee

Mr. Ray Nimmer
Reporter, UCC Article 2B Drafting Committee

c/o National Conference of Commissioners
on Uniform State Laws
676 North St. Clair Street
Suite 1700
Chicago, IL 60611

 

Dear Sirs:

I am writing to you in my role as Chairman of the American Committee for Interoperable Systems (ACIS) to comment on the most recent revised draft of UCC Article 2B. I wish to express concern with the change to Section 2B-105(b) that was intended to incorporate a motion put forward by Commissioner Harvey Perlman, and adopted during the deliberations of the NCCUSL Annual Meeting in July. In a nutshell, I am troubled by the change from the original language of the Perlman motion, which I support in full, to the new formulation that appears in the most recent Article 2B draft.

ACIS is a voluntary association of more than 30 corporations and organizations concerned with the future of the computer and communications industry. Members include: Advanced Micro Devices; Amdahl Corporation; Bull HN Information Systems Inc.; NCR Corporation; Seagate Technology Corporation; Storage Technology Corporation; Sun Microsystems, Inc; and 3Com Corporation among others. ACIS was created by its members to support policies and principles of intellectual property law providing for a careful balance between the goals of strong protection and rewards for innovation, and the goals of interoperability, fair competition and open systems. Our paramount concern is that intellectual property protection not be improperly extended in scope or practice in ways which would impede further innovation and development in this critical industry.

For some time, ACIS has been concerned that Article 2B would lead to a disruption of important principles of intellectual property law by rendering enforceable non-negotiated, mass-market license terms which prohibit reverse engineering. Such "shrink wrap" or "click-on" license terms would be a major impediment to the goals of achieving interoperability and promoting open systems. The original Perlman motion helped to significantly allay our fears with regard to this potential detrimental effect of Article 2B. However, the language used to incorporate the Perlman motion in the most recent Article 2B draft seems to dilute the motion's primary intent.

The new language of Section 2B-105(b) reads as follows: "A contract term that violates a fundamental public policy is unenforceable to the extent that the term is invalid under that policy." To be specific, the wording "FUNDAMeNTAL public policy" and "to the extent that the term is INVALID..." seem to be changes that erode the effectiveness of the Perlman motion. Requiring that the public policy be "fundamental" seems to invite further confusion and debate rather than provide certainty. Further, the qualification that contract terms would only be unenforceable to the extent that they are "invalid" under "that policy" seems to say that the public policy itself must specifically reference that type of contract term and label it as invalid.

In contrast, the original Perlman motion would permit a court to find a contract term to be unenforceable if the term is contrary to specific public policies relating to innovation, competition, and free expression, whether or not those policies have deemed certain contract terms to be invalid through explicit reference. This is a determination more appropriately left to the courts.

even the Reporter's notes to 2B-105 seem to backslide from the thrust of Commissioner Perlman's motion. Portions of the note establish an overly restrictive lens through which to view whether a term may be found unenforceable. The test, according to the Reporter's notes, would be whether or not the fundamental public policy said to make a term invalid itself "clearly over-rides the fundamental policies that support freedom of contract..." Taken together, the terminology used in Section 105(b) and the severe requirements suggested in the notes create a "belt and suspenders" framework that seems designed to prevent any term from ever being found unenforceable under this basis.

The Reporter's note also misses the mark with its characterization of reverse engineering. The note states that "debate" over when it would be proper to reverse engineer is an area where the public policy is "in flux." In truth, that "debate" has enjoyed considerable consensus of late, not only among court decisions, but also in federal legislation. Both the House and the Senate have passed legislation, the Digital Millennium Copyright Act, that specifically allows reverse engineering for purposes of achieving interoperability. This is a significant development that dramatically clarifies public policy on the issue of reverse engineering. This acceptance of reverse engineering should be reflected in the notes accordingly.

In conclusion, ACIS recommends that the language from the original Perlman motion be used in place of the current Section 2B-105(b), and that the Reporter's note be modified to be less restrictive in its tone and effect. Thank you for your consideration of these points.

Sincerely,

 

Peter M. C. Choy
Chairman

cc: ellyce Anapolski, NCCUSL


UCITA Pages On
James S. Huggins' Refrigerator Door

UCITA: Uniform Computer Information Transactions Act 
(This is the primary UCITA page.)
 
Home Box Office
Memo Spring 1998 (?)
 
45 Professors of Contracts and Commercial Law Letter 16.Jul.1999
 
Motion Picture Association of America Letter 10.Sep.1998
 
50 Intellectual Property Law Professors Letter 17.Nov.1998
 
Motion Picture Association of America Letter 09.Nov.1998
 
American Bar Association Letter 10.Jun.1999 
 
Motion Picture Association of America Letter 07.Dec.1998
 
American Committee on Interoperable Systems Letter 13.Jul.1998
 
Motion Picture Association of America Letter 10.May.1999
 
American Committee on Interoperable Systems Letter 07.Oct.1998
 
Movie, Publishing and Broadcasting Industry Letter 10.Sep.1999
 
American Committee on Interoperable Systems Letter 21.Jun.1999
 
National Music Publishers Association Letter 21.Jan.1999
 
American Committee on Interoperable Systems email 15.Jul.1999
 

Opposition Summary 
 
American Law Institute Letter 26.Mar.1999
 
 
Pamela Samuelson Letter 09.Jul.1999
 
Association of the Bar of the City of New York Report 21.Jun.1999
 
Principal Financial - Introduction to UCITA
 
 
Attorneys General Letter 23.Jul.1999
 
Principal Financial - Summary of UCITA
 
 
Attorneys General Letter 28.Jul.1999
 
Recording Industry Association of America Letter 09.Oct.1998
 

Attorneys General Letter 23.Jul.1999 
 
 
Sample Letter 


Caterpillar Statement 1999
 
 
Security Mutual Insurance Letter 26.May.1999
 

Consumer Groups Letter 10.Nov.1998 
 
Society for Information Management Letter 23.Mar.1998
 
 
Consumers Union Letter 08.Oct.1998
 
 
Society for Information Management Letter 08.Oct.1998
 
 
Consumers Union Letter 21.Jun.1999
 
Software engineering Institute Letter 01.Jun.1999
 
Digital Future Coalition Letter 23.Jun.1999
 
 
swtest-discuss Letter 20.Nov.1998
 

Digital Future Coalition Page Fall 1999
 


Want to link to my UCITA pages?
Want to suggest a link for me to add?
Please read my
Requests and Suggestions for Linking

The extra text menu links (previously here) are being removed in the site redesign.
Browser and search engine improvements have eliminated the motivation/necessity for them.

This page created:
before
Fri, 25.Oct.2002

Last updated:
16:20, Sat, 10.May.2014

. . .

NOTICE --- SITE  UNDERGOING REWRITE - SEE LINK BELOW FOR DETAILS

 Explanation of the rewrite: New Page Layout.
 Check out my blog: My Ephemerae
 Yes ... I want you to link to my site Please link to me
 Want to email me? I'd love to hear from you.
 I have begun tutoring in the South Houston, Texas area.

. . .
ucita, uniform computer information transactions act, american committee on interoperable systems, acis, ucita, uniform computer information transactions act, american committee on interoperable systems, acis, qwerty . . . ucita, uniform computer information transactions act, american committee on interoperable systems, acis, ucita, uniform computer information transactions act, american committee on interoperable systems, acis, qwerty