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Censorship Your Rights Online

Network Associates Loses Battle to Silence Reviewers 200

Posted by timothy from the prior-consent dept.
ajkessel writes "This article from today's New York Times covers a court ruling against Network Associates in a suit brought by the New York State Attorney General to invalidate Network Associate's shrink-wrap clause which states: 'The customer will not publish reviews of this product without prior consent from Network Associates Inc.' Network Associates has vowed to appeal." Reader SlashDotIDOne points to a CNET story which says "Network Associates could be forced to pay $0.50 for every license which included this draconian requirement: 'The customer will not publish reviews of this product without prior consent from Network Associates Inc.'"
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Network Associates Loses Battle to Silence Reviewers More

Network Associates Loses Battle to Silence Reviewers

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  • Woohoo!!! (Score:2, Interesting)

    by Trolling4Dollars ( 627073 )
    Sticking it to "the man" again! Considering the massive problems that we are having in the US with truth in advertising, decent journalism and contractual silencing of critics in other arenas, this is great news! I'm glad to see some logic prevailed. A lot of companies pay lip service to the statement that the "customer is always right". This particular contractual clause was just as tenuous as the stupid "non-compete" clauses that some employers slap down on people. It's ridiculous for any company to think that they can control what an employee does once they have left. Just the same as a company thinking that they can silence unsatisfied customers. Now, if only those anti-SUV ads would start showing up in more places.

  • So... (Score:5, Funny)

    by Anonymous Coward on Saturday January 18, 2003 @02:09PM (#5108284)
    Is it safe to even comment on the story?

  • Best Quote Ever: (Score:5, Funny)

    by Saint Aardvark ( 159009 ) on Saturday January 18, 2003 @02:09PM (#5108287) Homepage Journal
    "Our goal here was to actually increase the amount of information available to customers."--Kent Roberts, executive vice president and general counsel for Network Associates.

    • Re:Best Quote Ever: (Score:2, Informative)

      by Skater ( 41976 )
      From the folks in the PGP arm of NAI (when PGP was part of NAI), I think they said the reason for that policy was to prevent journalists from testing software and coming to bad conclusions because they weren't familiar with the subject material.

      It seemed kind of lame, but I can at least see where they were coming from.

      --RJ

      • That is elitist, and nuts. Remind me if I ever write a book to put a EULA in claiming that the book can't be reviewed by critics because I don't want people who don't have familiarity with the subject material to review it.

        If reviewers were forced to only review products / services / etc with which they had familiarity why Tom's Hardware would be out of business in a week...Hmm maybe that's not such a bad idea after all...

        *rimshot*

      • Re:Best Quote Ever: (Score:3, Insightful)

        by rgmoore ( 133276 )
        I think they said the reason for that policy was to prevent journalists from testing software and coming to bad conclusions because they weren't familiar with the subject material.

        Which is patently silly. One of the things that I'm most interested in when reading a review is whether the features listed by the manufacturer are actually easy enough to use that I could have a hope of doing what I want to with the software. If the reviewer can't figure out how to use them with the documentation provided, that's a very interesting thing for me to know. Preventing reviewers from revealing that kind of information is just plain wrong.

    • Is this guy a blatant liar or just plain stupid?

      I am getting so tired of spin, lies and Orwellian doublespeak. Apparently the truth is an endangered species today. Or maybe I should be offended that corporations believe that we are stupid or incapable of critical thought.

      • Re:Best Quote Ever: (Score:2, Insightful)

        by instarx ( 615765 )
        Blame it on the lawyers.

        This isn't a typical anti-lawyer rant - there is some logic behind it...

        Lawyers do not think about problems and situatons the way we do. Lawyers are advocates. You and I look at all sides of an issue and reach a conclusion based on all the facts, plus and minus. Lawyers, on the other hand, are not _supposed_ to look at all the facts - only the ones that help their side! Lawyers are not required to be objective and are definately not required to present any arguments that do not support their position.

        Take a recent example: a very recent study showed that people taking an expensive blood pressure medicine had a 25% higher incidence of heart falure over those taking a cheaper drug, even though the blood pressure in both groups were lowered to the same level. What was the pharmaceutical company's official press release? "Our drug shown to be just as effctive in lowering blood pressure as other more traditional drugs!" Is this true? Yes. Is it the whole story? No. But the lawyers have learned that as long as what they say is technicaly true, it doesn't matter what they don't say. If questioned, their legal argument would be that they made no claim whatsoever about increased longevity. I'm not picking on pharmaceuticals - all industries do it as well as te governement.

        The point of this rant is that we all have to be skeptical about _everything_ we read and hear on any topic that involves money (business) or power (politics). I hate it too, but that is just the way it is. Trust nothing, verify everything, think for yourself!

        An excellent treatment of how to lie with spin and statistics is the book "Trust Us - We're Experts" An interesting read and highly recommended.

  • Good (Score:3, Insightful)

    by wan23 ( 636995 ) <wan23&email,com> on Saturday January 18, 2003 @02:10PM (#5108293)
    Why do so many corporations think they can ignore laws they don't like (i.e. the first amendment) and make up new ones arbitratily (well.. I suppose that happens all the time, doesn't it?)

    • Re:Good (Score:2, Interesting)

      by Planesdragon ( 210349 )
      Why do so many corporations think they can ignore laws they don't like (i.e. the first amendment)

      Corproations aren't the government. Corporations can and do abridge the freedom of speech through contracts all the friggin' time.

      Now, if it's unfair and unreasonable, the offended citizen can go to court and get the corp smacked for all sorts of things like discrimination and fraud and unfair practices--but "first amendement violation" isn't one of them.

      • Re:Good (Score:5, Informative)

        by civilizedINTENSITY ( 45686 ) on Saturday January 18, 2003 @03:19PM (#5108702)
        But is it 1st Amendment?

        Last spring, Mr. Spitzer sued Network Associates, which has its headquarters in Santa Clara, Calif., asserting that the company's software included an unenforceable clause that effectively violated
        consumers' free speech. The clause, which appeared on software products and the company's Web site, read: "The customer will not publish reviews of this product without prior consent from Network Associates Inc."

        http://www.canarsiecourier.com/News/2002/0221/Othe rNews/018.html [canarsiecourier.com]
        Spitzer's suit also alleges that the clauses infringe upon consumers' and the media's freedom of speech and fair use rights under copyright law. It contends that by informing software users that the speech restrictions are justified under existing "rules and regulations" - even though no such rules or regulations really exist -- the company also committed an unlawful deceptive practice.

        What New York Law Says [gigalaw.com]

        But are these clauses really illegal under New York State law? And does the attorney general have the right to bring a civil action for money damages and an injunction because of it? Here's where close attention to the laws is vital.

        Pertinent provisions of the laws of the State of New York give the state's attorney general broad powers to bring suit for what it perceives to be illegal or fraudulent business practices.

        For example, Section 63(12) of New York's Executive Law specifically allows the attorney general to bring suit regarding cases of "persistent fraud or illegality in the carrying on, conducting or transaction of business". The statute says, "[t]he term 'persistent fraud' or 'illegality'... shall include continuance or carrying on of any fraudulent or illegal act or conduct ". In fact, under the section, the term "fraud" includes "any... deception, misrepresentation, concealment, suppression, false pretense, false promise or unconscionable contractual clauses" and does not necessarily require wrongful intent.

        In the Network Associatescase, the claimed fraudulent conduct is that the Censorship Clause refers to allegedly non-existent rules and regulations. Even more so because the actual license agreement inside the box mentions nothing about this clause and otherwise makes clear that the four corners of the license agreement represent the entire agreement with the purchaser. Such conduct is claimed to be "illegal" because it is an "unenforceable covenant, invalid as against public policy," according to the complaint.

        In other words, according to the New York attorney general, Network Associates' warning was fraudulent not only because it wrongly referred to non-existent rules and regulations, but also because the plain terms of the license agreement would have excluded such a clause, found only on the box, label or download page of the software, from even being enforceable and because the restriction violated public policy by creating a "chilling effect" on legally permitted speech that would be beneficial to the consumer.

        Interestingly, under cited case law interpreting this statutory section, proof that Network Associates actually intended to defraud or mislead isn't necessary. Yet, according to the attorney general, Network Associates has shown this intent anyway.

        In its legal memorandum, the attorney general said that Network Associates tried to use the Censorship Clause to kill an unfavorable review of its "Gauntlet" firewall software [pgp.com]by Network World magazine, allegedly invoking the clause to threaten the magazine with legal action if the review was not taken down from the magazine's web site and otherwise retracted.

        Under the terms of this New York State law provision, when the attorney general finds such conduct, it has the right to seek broad relief, including financial damages and injunctions to stop the practice from continuing.

        Similarly, Section 349 of New York's General Business Law makes unlawful "[d]eceptive acts or practices in the conduct of any business, trade or commerce or in the furnishing of any service in this State" and allows the attorney general to file suit for an injunction and for restitution, that is, the return of money wrongfully given.

        As set forth in the attorney general's memorandum, the disputed Network Associates clauses "unfairly chill the consumer's enthusiasm to enforce" their rights.

        What is particularly alarming about this statute, from the point of view of a defendant like Network Associates, is that it also authorizes a private right of action, allowing any individual harmed by the practice to sue for as much as $1,000 and recovery of counsel fees based upon deceptive practices prohibited by the law. So, if New York state were to be successful on this claim, a multitude of individual suits might be in the offing, perhaps even a class action.

    • Re:Good (Score:5, Insightful)

      by mickwd ( 196449 ) on Saturday January 18, 2003 @02:31PM (#5108421)
      Because management training schemes teach managers that "it's easier to ask for forgiveness than it is to ask for permission". They're taught to try it on and to see what they can get away with.

      Too many people here think there's just something "evil" about big corporations in general. They're not evil as such. The reason they act as they do is all about making money. They'll try and get away with whatever they can to make money until they're told they can't (the same way certain dictators will try things on until threatened with force).

      But then money, as they say, is the root of all evil.

      • Re:Good (Score:3, Insightful)

        by shreak ( 248275 )
        You seem to be saying that just because something isn't "evil" it isn't bad. This is not true. It seems to be the nature of corporations to focus only on makeing money and to try any avenue, no matter how morally bankrupt, to that end. This is "bad". If the system forces this behavior then the system is "bad".

        It's in my son's nature to try and get away with stealing cookies out of the cookie jar (he's 6). It's his nature, he's not "evil". He's still punished because it's "bad" behavior.

        At some point I'll expect my son to be a "morally aware" person. This means that, even though he's never tried it and been punished for it, he'll know that taking cash from an open and unattended till is wrong. He won't try it just to see if it works. More over, if he does try it, he would be punished at a much higher intensity, because he should have known better.

        You seem to be arguing that we shouldn't expect corperations to "know better". I don't agree, we should hold corporations to a higher level of "moral awareness".

        =Shreak

  • Stifling Speech (Score:5, Interesting)

    by hackwrench ( 573697 ) <hackwrench@hotmail.com> on Saturday January 18, 2003 @02:12PM (#5108301) Homepage Journal
    "Such clauses censoring speech and criticism chill not only consumers' speech, but also prevent academics, consumer advocates and technology experts alike from openly and freely discussing software products," New York Attorney General Eliot Spitzer

    Make Eliot Spitzer a Supreme Court Justice!

    • Re:Stifling Speech (Score:5, Interesting)

      by Nessak ( 9218 ) on Saturday January 18, 2003 @02:30PM (#5108416) Homepage
      Eliot Spitzer is one of the few people in this country which seems to be doing his job right when it comes to justice and protecting consumers. While this is good, most people will remember him for going after Merrill Lynch for all types of charges related to fraud that the federal goverment wanted to overlook. His state office is doing more then federal offices like SEC and even aspects of DOJ. But what has ge gotten in return?

      After Enron & Worldcom went down in flames and congress scrambled to enact some sort of legislation that made it look like they were trying to fix the problems, they included clauses which makes it very hard for states to go after companies in cases like Eliot Spitzer did with Merrill Lynch. Lobbists & Feds knew that if states have active people like Spitzer, it might risk the good system of oversights the federal goverment is becoming so good at.

      So I agree, make Eliot Spitzer a Supreme Court Justice. I'm sure many other reasonable citizens who like their rights being protected would agree. But somehow I don't think Congress would ever elect anyone who has as much guts and insight as Spitzer. He is simply to great of a risk to the people with the real money.

      • Re:Stifling Speech (Score:3, Interesting)

        by jmauro ( 32523 )
        While this is good, most people will remember him for going after Merrill Lynch for all types of charges related to fraud that the federal goverment wanted to overlook. His state office is doing more then federal offices like SEC and even aspects of DOJ. But what has ge gotten in return?

        Except he folded like a lawn chair. [salon.com] Remeber. Saying and doing are two different things. He talks the talk, but when it comes down to it he's not doing anything other than small fines on the "evil doers".

      • Re:Stifling Speech (Score:5, Insightful)

        by jgalun ( 8930 ) on Saturday January 18, 2003 @03:19PM (#5108706) Homepage
        His state office is doing more then federal offices like SEC and even aspects of DOJ. But what has ge gotten in return?

        I know this isn't really where you were going, but Spitzer has become extremely well-known and well-respected as a result of his actions against Wall Street and corporations. His plan is to run for New York Governor some day, and this popularity has a real good chance to make that a reality. Because Spitzer has done something very wise, politically-speaking. By going against lying investment banks and NA for preventing reviews, he is aligning himself not against business, but against the excesses of business that hurt the average person.

        Spitzer will get the anti-business, far-left votes when he runs for governor, no matter what, because the choice comes down to Democratic Spitzer versus a Republican. But in being for saving capitalism (and protecting the average investor/user) through regulation, rather than attacking capitalism through government fiat, Spitzer can pick up votes from the broad middle that believes in capitalism and a corporate economy, but also believes that corporations sometimes do illegal things that must be prevented.

        Having said that Spitzer's line of attack is very wise politically, I don't actually believe that he has made his decision on how to confront corporations based on self-interested political motives. The fact is that Spitzer almost became a corporate lawyer himself. He does not hate corporations, and he does not want to destroy Merrill Lynch. He just wants to make sure they don't lie to investors.

        It's like FDR during the New Deal. There were people on the far left who wanted socialism in the US. But FDR believed that it was best to keep capitalism, but to fix its most egregious flaws.

        And I think it's silly to write off Spitzer as a potential Supreme Court Justice, some day. If a Democratic president nominated him, it would be very hard for Republicans in Congress to oppose him. Because while Republicans might not love Spitzer, that doesn't give them enough to oppose him. Sure, Larry Kudlow and Forbes magazine would support spiking his nomination, but it would definitely be a losing issue for the Republicans to make, because there are too many swing and Republican voters who would say, "Hey wait, I own stock, I'm glad Spitzer stopped these bastards from lying to me!"

        Supreme Court nominations get a huge amount of publicity. It's way too risky for the Republicans, already perceived as the party of the rich, to spike a guy because he protected stock market investors (who now make up a majority of the population) against lying corporations.

  • Non-registration Version (Score:5, Informative)

    by Amsterdam Vallon ( 639622 ) <amsterdamvallon2003@yahoo.com> on Saturday January 18, 2003 @02:12PM (#5108303) Homepage
    Court Rules Against Network Associates' Software Review Policy
    By Travis P. Scholtens

    A New York court has ruled that Network Associates, a maker of popular antivirus and computer security software, may not require people who buy the software to get permission from the company before publishing reviews of its products.

    The decision, which the company has vowed to appeal, could carry a penalty in the millions of dollars, according to Ken Dreifach, chief of the Internet bureau of the office of the New York State attorney general, Eliot Spitzer.
    Advertisement

    Last spring, Mr. Spitzer sued Network Associates, which has its headquarters in Santa Clara, Calif., asserting that the company's software included an unenforceable clause that effectively violated consumers' free speech. The clause, which appeared on software products and the company's Web site, read: "The customer will not publish reviews of this product without prior consent from Network Associates Inc."

    In a decision the parties received late Thursday, Justice Marilyn Shafer of State Supreme Court in Manhattan ruled that the clause was deceptive and that it warranted a fine, which she wrote that she would determine in the future.

    Mr. Dreifach said the decision had implications beyond Network Associates. "These types of clauses are not uncommon," he said. The decision "raises the issue of whether these types of clauses -- whether they restrict use, resale or the right to criticize -- are enforceable," he added.

    Indeed, other software makers, including Microsoft, have been criticized by product reviewers for including prohibitions in their users' licenses.

    But Mr. Dreifach said the State of New York singled out Network Associates because, he asserted, "it was the most egregious example we saw." He said that before New York pursued other cases, the attorney general would wait and see whether companies changed their policies, and whether consumers used the decision to address concerns with companies.

    Kent Roberts, the general counsel for Network Associates, said last February that the company had decided to update the language on its products. At that time, he said the new language would address Network Associates' real concern, namely, that reviewers did not publish reviews of old or outdated versions of the software.

    Yesterday, Mr. Roberts said the company was still in the process of changing the language. "It's a process to change the physical product," he said. "We're trying to get it done as quickly as possible."

    Still, Mr. Roberts said he disagreed with the court's reasoning. He said that Network Associates had never intended to restrict speech, but wanted to make sure that reviewers did not publish misleading information about its current release of products.

    "I still fail to see -- having read the opinion several times -- how we are being deceptive," he said.

    The State of New York asked the court to impose a fine of 50 cents for each product sold with the license. Mr. Dreifach estimated the numbers of products to be in the millions, but said Network Associates had not complied with a request to provide the precise number sold.

    Mr. Roberts said the clause had appeared on "almost all of our products," which includes three product lines with several software versions on each line. But he said he did not have an estimate of how many products had been sold with the clause.

    • Re:Non-registration Version (Score:2, Interesting)

      by Anonymous Coward
      Network Associates is clearly full of shit. But what I don't like is that the court is, in its decision, making the false assumption that shrink wrap licenses are valid, enforceable contracts to begin with. And the party the State is going up against, NAI, is not in a position to want to fight against this false assumption. So, the end result is that the courts are able to set a precedent in which shrink wrap licensing is ruled valid & no consumers have a say in it. In fact, they make it seem like the State is acting on behalf of the consumer, when they really are not. Pretty sneaky.

      • Well there is an upside to making shrink-wrap licenses valid. It makes the GPL, BSD, etc. stronger.

        • Not really. The GPL isn't a shrink-wrap license.

          You can download (or buy, or be given) a GPLed program, and use it in any way you want, without the GPL being involved at all. You can even sell your copy if you wish.

          But, if you want to take the source code (which is available because the program is GPLed) then you can do as much with it as copyright law allows. Read it. You can't use it, you can't base your program on it. Normally you'd have to write to the developer asking for permission, but here they've anticipated your letter and they're saying "If what you want to do is use the source, and you're willing to do so in these ways and with these limitations, go for it, accept this contract and go for it."

          An EULA is supposed to affect how you use the program, and if you're even allowed to use it. The GPL isn't relevant to that at all, it's only a way around you having to write to the developers asking for permission to use their source code in a new project. And then, only if you want to release it.

          We could abolish EULAs (I wish) and it wouldn't impact the GPL at all.
      • The law is fairly logical and supports the notion of conditionality. The courts can rule that A does not imply B without ruling that A is true. I.E. were this is a contract it would be invalid does not prove that if the clause were removed the contract is valid.
  • So... what about us Corporate "Unlimited Licenses" users? How much do they "owe" me/my company?

    • Re:50 cents (Score:3, Informative)

      by martissimo ( 515886 )
      nada... seriously the state just asked for a fine of 50 cents per license, it's going to New York, not you
      • seriously the state just asked for a fine of 50 cents per license, it's going to New York, not you

        Drats. I was just filling out a stamped self-address envelope and sticking it in a stamped envelope to claim my $.50

        -
    • So... what about us Corporate "Unlimited Licenses" users? How much do they "owe" me/my company?

      One unlimited license = $0.50?
      • One unlimited license = $0.50?

        Most likely, but when you factor in the number of retail licenses they've sold within New York State, the fine is still going to head into a very annoying number in the millions.

        Really, the violation here was per license, not per user... because nobody was ever really restricted from reviewing Network Associates products. The violation was that NA falsely claimed that you couldn't in the license... which likely fooled a lot of people into thinking they couldn't.
    • You just bankrupted NA. Congratulations!

  • Registration-less link (Score:1, Informative)

    by Anonymous Coward
    here [cnn.com]

  • License is good warning (Score:5, Insightful)

    by moz25 ( 262020 ) on Saturday January 18, 2003 @02:17PM (#5108343) Homepage
    If you may only use a product on the basis of not sharing your experiences, then I'd see that as a WARNING that the product probably sucks and doesn't hold up in comparisons without optimal boundary conditions.

    It signals a BIG lack of confidence from side of the manufacturer if it believes the quality of its product won't shine through reviews naturally. Sure, there'll be a few bad/dishonest reviews, but the majority of (semi-)reliable ones should be positive. That is... if the manufacturer agrees that its product is indeed excellent. In this case, apparently not ;-)

    This case is good news.. I hope it sets a precedent.

    Regards,

    Moz.
    • That, or it means they don't expect the majority to read... and can then gain money sueing anybody who does something that does represent a bad image of the product.

      How many tiny little clauses are there that make it easy for big companies to sue. I'm still waiting to see who slips "and will forthwith donate one's firstborn child, upon reaching the age of two years, as a sacri^h^h^h^h token of good esteem to the company."
    • What they're probably trying to avoid is competition making them look bad by publishing benchmarks, or whatevers that show they are worse than said competition.

      I really doubt they actually care of custommer base writing reviews - that has very little credibility. Norton, on the other hand, saying NA is no good is something to think about (for some).

  • I know that a number of vendors require permission before being able to perform and report the results of benchmarking their products especially in the database arena and was wondering if this ruling could me made to apply to them as well?

    I don't have a EULA or licence handy but would be quite interested in seeing whether this sets a precedent or is unrelated.
    • There is a substantial difference between enterprise software vendors that require signed contracts and shrinkwrap EULAs.


      My guess is that this ruling will lead to the conclusion that a shrinkwrap EULA can not contain restrictions on the right to commercial or academic speech about the product. I should hope that is the case - there are legal reasons (in the USA) that such "Contracts of Adhesion" (I believe that's what they are generally called) can not be expected to be read in detail by the person accepting the contract, and clauses like this are generally not enforceable. This should come as no surprise except to the imbeciles who've been pushing EULAs as some sort of magic legal protection for years now.


      Of course, signed contracts between two parties are different beasts entirely. If you sign a contract for a $100,000 license for a database product, or some other large enterprise software system, they can probably put all sorts of clauses of this sort in there.

      • I'd challenge that agreeing to the EULA is a requirement at all.

        When I purchase boxed software, the exchange has the basic properties of a sale. I don't go into CompUSA and license software--I buy it. By purhasing the software in such a manner, there are certain things that I feel I'm implicitly allowed to do. Like, say, installing and running the software. The text of the EULA is not required in any way for me to be allowed to do this. Furthermore, I would hold that "agreeing" to a shrinkwrap license by performing some action which would be reasonably expected to be performed after purchasing the software (again, opening the box, installing it, and running it) is not in fact agreement, but just clicking on pretty widgets (or shredding the pretty shrinkwrap).

        Just my two cents.

        • Re:What Does This Mean for Benchmarks? (Score:5, Insightful)

          by Fnkmaster ( 89084 ) on Saturday January 18, 2003 @03:16PM (#5108688)
          Oh, I certainly agree with you from a moral and legal perspective that an EULA is meaningless since there are no characteristics of a contract at all.


          Rather, the argument that Spitzer used seemed to be that because the contract was included in the box of a mass market software product and had terms that were anathema to the public interest, those terms should be thrown out (i.e. as in with a contract of adherence). He did not seem to make the argument that the EULA wasn't a contract at all and thus was invalid on the face of it (though I agree with you that it should be, and that some decisions have supported our view on this). Rather, this just reinforces that terms odious to the public interest should be thrown out from EULAs, and thus presumably that they are being interpreted as contracts of adherence, at least by this argument in this court.

    • I've always been amazed that the big database vendors (Microsoft and Oracle for sure, IBM probably) got away with putting restrictions on reviews like this in their EULA's for years, but understood it to be a result of the complexity of configuring the products. That's why we don't see head-to-head comparisons of the major commercial database server products. A couple of small changes to a DB configuration can have a huge effect on the performance of the product, so the companies require their own engineers be on-hand to tune the config. Most publishers just don't have the time or resources required to set up a fair comparison review that fulfills the terms of the EULA. The only comparison reviews we see are published (in ads, mostly) by the vendors themselves. And they never say anything bad about themselves (or anything good about their competition). Sometimes it's the hardware vendors who publish benchmark results, and their purpose is to sell more hardware, not to enlighten end users.

      What could possibly cause the same restrictions on anti-virus software? Could it be that difficult to configure? Or is the user above correct in inferring the software must be really bad? I suspect the reason the clause is in the EULA is that some lawyer thought they could get away with it and tried it. Now the court says no, and the vendor makes a pout and removes it. That means the laws work. Yay.
      • It's still utter nonsense. Oracle doesn't send over a team of it's best engineers to make sure that my database is configured properly (unless I pay them alot of money), and MS certainly doesn't do it for SQL Server. Therefore, any benchmarks that WERE tuned in such a way have nothing to do with MY use of the product, so are misleading at best. I WANT to see how database X performs out of the box.
    • Yes, I was thinking the same thing.

      Now someone with balls should extend this precedent by posting on the internet and in print a complete review of all the different databases: Oracle, Dbase2, Sql Server, Sybase, etc using their real names. Attach a copy of this case to the website and just prepare for the wolves to close in. My bet is the wolves back off and get scared.

      The result would be a much more review friendly world, where we could start posting reviews on any products we want without fear of lawsuit. Not just databases but applications servers and much more! What a world this could be!
  • Sounds great. Companies being forced to pay up when they try to impose illegial terms on an EULA.

    Look out Microsoft!

  • Maybe (Score:2, Interesting)

    by Bendebecker ( 633126 )
    Just maybe one company will now get it through their thick skulls that just because they write something in some end-user license agreement doesn't mean it's legal to then hold a person to it. Sue on!

  • This ruling is interesting (Score:5, Interesting)

    by GigsVT ( 208848 ) on Saturday January 18, 2003 @02:20PM (#5108364) Journal
    In a way, this ruling creates a basis to say that an EULA is not a "contract" under contract law.

    It's been firmly established that companies can enter into contracts with other companies and individuals that have the end result of censoring speech. Every nondisclosure agreement is of this nature.

    This ruling is basically saying that the EULA is not a contract in the usual sense, and could provide basis for throwing out a whole lot of EULA clauses that are obnoxious.

    While I think it would take another case to broaden this to the point of really making a difference, if this stands up to appeal, then it does make for interesting precedent. The end result could be reeling back in the EULA, and maybe getting some spyware people thrown in jail (including MS). A very good thing.

    As always, IANAL.
    • isn't "a meeting of the minds" an essential aspect of a contract? I mean, an obviously intoxicated individual can't make a valid contract for this reason can he?

      And aren't there exceptions made in contract law when the parties have "unequal strength", or some such thing?

      I've often wondered whether all those strict and draconian terms are enforceable. I didn't realize that claiming enforceability might be regarded as consumer fraud. I like it!

      • isn't "a meeting of the minds" an essential aspect of a contract?

        That is one of my objections to EULAs. Even my lawyer, who lives in MD which passed UCITA, doesn't read them because "there are too many of them". Although he would never sign a contract without reading it.

        I suspect that they are designed to discourge people from actually reading them. Don't put a printered version in package. Disable the ability to print it. Put a multipage contract in a little scroll box that only shows 6 lines at a time. Use monotype and heavy leagelese.

        And aren't there exceptions made in contract law when the parties have "unequal strength", or some such thing?

        There are; but, I am not sure what the test for it is. All the cases that challenged them on "material modification of the original contract" grounds. The defendant in the ProCD case unsuccessfully argued that the purchase was the original contract. In Stepsaver, they successfully argued that the Purchase Order was the original contract. In a CA case, they are arguing that there is not contract because they did not run the software or click on "I Agree".

    • But does the ruling seem to say that a EULA is not a contract?

      From what I understand from the article, it was ruled that the specific clause was unenforceble as it violated customers' free speech. If anything, I think the ruling creates a basis which says that a EULA can be a contract, ie. the judge ruled that a clause in the EULA was not enforceble and therefore not valid - this is a feature of contract law in many countries.

      Tim

      • Mr. Dreifach said the decision had implications beyond Network Associates. "These types of clauses are not uncommon," he said. The decision "raises the issue of whether these types of clauses -- whether they restrict use, resale or the right to criticize -- are enforceable," he added.

        A lot EULA's have stupid and asinine clauses in them and they're getting worse every year. I think this ruling sets a precident that there are restrictions to how far EULA's can go in limiting the rights of the customer.
    • Nonono, this ruling goes more towards saying that you can't sign away your basic rights, which in this case would be the right of free speech.

      Which, of course is correct as the Constitution and therefore the Bill of Rights takes prescedent over everything else in this country.

      Well... It's supposed to anyway.

      • nda's? (Score:2, Insightful)

        by gimpboy ( 34912 )
        Nonono, this ruling goes more towards saying that you can't sign away your basic rights, which in this case would be the right of free speech.

        dont you do this when you sign an nondiscolsure agreement (NDA)? say i interview with a company and i have to sign an nda. then i've effectivley signed away my rights to talk about anything they put in the nda--isnt this how it works?

  • They suck !

    That being said, I can't believe their arrogance. Lucky I'm not a judge sitting on that case.

  • .NET benchmark clause (Score:1, Insightful)

    by Anonymous Coward
    Does this mean it's OK to publish non-Microsoft-approved .NET benchmarks now?

  • If I'm right (Score:4, Insightful)

    by carlmenezes ( 204187 ) on Saturday January 18, 2003 @02:22PM (#5108377) Homepage
    Hasn't Microsoft used a similar clause in their .NET license agreement? Can that be challenged too?

    • Re:If I'm right (Score:3, Funny)

      by jc42 ( 318812 )
      Hasn't Microsoft used a similar clause in their .NET license agreement? Can that be challenged too?

      Yes, of course. But it'll take you ten years and a few million dollars in court costs. And in the end, the court will "punish" Microsoft by ordering them to send copies of the EOLA to the Technical Committee that was set up by the DoJ's "punishment". After doing that, of course, nobody will be able to use the EULA as evidence against Microsoft in any further court actions.

  • You buy the product and let someone else review it. Then they write the review of it. As they didnt buy it they are not bound by the the EULA.

    And what stops someone who bought it telling another that its good/bad so they could review it for you.

  • Does n't Oracle have a similar clause saying you cant produce benchmark results for their database?
  • It amazes me that anyone thinks they could get away with such a clause.

    I could maybe understand if it were some confidential non-disclosure agreement, but it's not it's their off the shelf product/services.

    Tell them to start doing more business in the USSR circa 1980 and maybe they could get away with such a stupid clause.
  • I have noticed that too often it seems that IP holders, **especially** copyright holders, tend to think that any demand that they be held to the same standards and expectations that everyone other manufacturer is constitutes a draconian restriction of their "rights." Many of the ones I've debated in other forums act like "my shit doesn't stink because I made this so you can't tell me what to do." They think that because it's "their property" they can restrict how their customers use it no matter what. There is a valid argument in some cases such as licensing source code so you can make a derivative product for your company or agency's needs, but off-the-shell? Who the hell are they to do such things?

    Copyright holders better learn pretty quickly that the states can really piss on their parade because unbeknownst to many otherwise legally astute individuals, the states, not the feds, have total sovereignty within their borders. That means your little EULA can be balled up and chucked in the trash by NY, CA, VA, etc. They can make it a class 6 felony punishable by 20 years in a state prison for knowingly distributing "copy-restricted" CDs and what can the copyright holder do? Abide by the law or go to prison, that's what. Right now my state, VA, could pass a law declaring off the shelf licenses null and void and there would be no recourse because VA has the right to invalidate any contract within its borders. It can say, "we don't give a rat's ass who you think you are and what jurisdiction you want to be covered in. You are selling your products in Virginia to a resident of Virginia and that means you are under **our** jurisdiction, not Washington State's!"

    Personally I think the system would just be better off if each state would invalidate EULAs and make it a felony to sell copy-restricted media within their borders. The feds cannot stop that, period. They can allow theoretically it to pass from point A to point B, but they cannot give the greenlight to Walmart to seel Britney's latest hacked up CD if the state says Walmart cannot. There is no real market for IP. Either you accept the terms of the copyright holder or you go to hell. That's not a market, that's a socialist-style monopoly. Copyright holders need to respect that, if they did they'd be richer, we'd be freer and more supportive of them IMO.

  • Those who have closely followed the unfolding of NSI since their early days are no doubt unsurprised by this story. Those, like John Gilmore, having tracked the development o f NSI back to SAIC and DARPA are likely to have an ever-increasing "See, I told you so" conspiracy-theorist standpoint. NSI, in many ways, is the Microsoft of the DNS world. NSI wishes to offer services in exchange for money, yet at the same time, wants to also maintain control of those who are their customers.

    It is seemingly paradoxical how companies selling technology offer their products as enabling of opportunity and yet, ultimately want to use that opportunity to create further dependency upon themselves. Slashdot itself, at some point will seek refuge in its popularity and economic viability, thus corrupting its own indealism by way of regulating and moderating its "free" speech claims.

    LadyboyLovers.com [ladyboylovers.com]
  • I guess the courts still aren't as anti-consumer as the slashdot crowd wants to believe, yet.

    • No, No, They are... (Score:2, Interesting)

      by notque ( 636838 )
      At least both sides get posted here at slashdot. The courts are generally terrible at following logic as it adheres to computers, because each individual judge is not the most computer savy.

      They use comparitive laws usually to side with one side or another (that, and corperate pandering), and comparitive laws in other fields don't apply.

  • Another reason to kill the UCITA (Score:3, Interesting)

    by darkonc ( 47285 ) <stephen_samuel@b ... m ['n.c' in gap]> on Saturday January 18, 2003 @02:36PM (#5108452) Homepage Journal
    The news.com article has a related story about the controversy over the ucita [com.com].

    Someoone should point out to the New York State Attorney General that if the UCITA gets passed in New York, it could make this rulling moot. The ruling is based on the fact that the gag clause is unenforcable while the UCITA would (among other things) add teeth to the click-through agreement, and might make the gag clause enforcable. At that point, the ruling would disappear in a puff of logic.

    • At that point, the ruling would disappear in a puff of logic.

      While it's quite possible the ruling may dissapear in a puff, I don't quite think it would be a puff of logic.

      -
      • Once the law is is place, it's essentially a logic exercise (although law contains a lot of normative decisions as well). Once it's decided that the law validates the gag-clause, the rest falls out (unless they somehow decide that the gag clause is unconstitutional/unreasonable).

        If you think of legalese as a natural-language programming language, and the judges as a wet-ware execution processor (with one or two bits loose, here and there) then the legal system gets pretty easy to deal with. I was reasonably successful using that model up to the court of appeal level.

        Like learning any new language style, it takes time to get up to speed, but once you do, it's no more difficult to understand than Java (just a lot more verbose).

        • If you think of legalese as a natural-language programming language, and the judges as a wet-ware execution processor

          Yeah, chuckle. I was just making a joke about legal "logic". The same way a lawyer would find 255+1=0 and 32767+2=-32767 to be rather peculiar "logic" :)

          -
          • The legal logic system suffers from what I call ghoti-fish.. In the legal system, they use phrases like: "Good case, bad law". Think of it as code re-use with a vengance:

            • gh as in enough
            • o as in women
            • ti as in initiative
            Given these legal precedents, it's clear that ghoti is pronounced the same as fish.

            The prosecution rests (er, um, nanosleep(2)s).

  • Good for them. Maybe this will be the start of giving Oracle and MickeySoft the big finger about not being allowed to post benchmarks of their DB products without permission.

  • I didn't sign anything. (Score:3, Interesting)

    by macdaddy357 ( 582412 ) <macdaddy357@hotmail.com> on Saturday January 18, 2003 @03:44PM (#5108824)
    If shrinkwrap EULAs are allowed to stand up in court, that would violate free spech, fair use, and the first sale principle. I applaud this decision, but I ignore EULAs anyway. I didn't sign anything, so I didn't agree to anything.
  • To: PR@nai.com
    Subject: About the recent reviewer lawsuit...

    http://www.nytimes.com/2003/01/18/business/18SOFT. html [nytimes.com]

    On behalf of people who hold sacrosanct the 1st Amendment, I'd just like to say HA HA YOU TOTAL LOSERS. Harsh, maybe. But heartfelt. And, if you SERIOUSLY appeal this, as has been rumored, you will LOSE again. And I will send you another email quite similar to this one, except that next time, I'll rub in how you got beaten down twice. Heh. Losers.
  • It seems to me that if the courts throw out enough EULA's, the whole concept of EULA's will be weakened or even rejected altogether. So ridiculous as it may seem, if we put insane clauses in the EULA's for our software (firstborn child, etc.), it will eventually help get rid of the whole stupid concept. Am I right? What do you guys (or gals if there are any) think?

  • What if I'm not the customer? (Score:3, Interesting)

    by Wolfier ( 94144 ) on Saturday January 18, 2003 @05:45PM (#5109470)
    Let a friend publish the review!
  • At first glance, this seems to be a welcome development. But read the following quote carefully:

    He said that before New York pursued other cases, the attorney general would wait and see whether companies changed their policies, and whether consumers used the decision to address concerns with companies.

    Does anyone actually think NY State is going to monitor companies to see if they change their policies? This translates into "corporations who do not donate to the party-in-control in New York State will be singled out for harsher treatment, so start getting out those checkbooks."

    In all seriousness (the above was only partly tongue in cheek) though, this decision would have been OK even if no fine was imposed. It would be perfectly acceptable for the decision to basically say "These clauses are legally un-enforcable. Consumers should feel free to ignore them without any fear of legal liability." I would have been fine with that.
  • As I recall, Netscape imposed, and for all I know still does impose, a similar ban on benchmarking it's Enterprise web server, and also made some attempt to limit how you reviewed the software. Those benchmarks that were done showed it was a dog (allegedly).

  • "Unenforceable, illegal and deceptive" EULA (Score:3, Informative)

    by Animats ( 122034 ) on Saturday January 18, 2003 @09:58PM (#5110706) Homepage
    This makes it clear to companies that there's a real risk to putting improper threats in EULAs. Usually, such threats aren't enforced or enforceable; they're just there to terrify customers. (The legal term is "in terrorium") But Network Associates actually tried to enforce such a term, which is blatently illegal. Read the Attorney General's press release. [state.ny.us] From their memorandum of law:
    • "Software maker Network Associates, Inc. ("Network Associates" or "the company") misleads its consumers by placing written restrictions on their software purchases. Namely, the company tells consumers, either in form License Agreements or on the face of the software diskette, that:
      • "Rules and regulations" prohibit consumers from "disclos[ing] the results of any benchmark test" (i.e., product test), absent "written approval" and
      • Those "rules and regulations" also prohibit them publish[ing] review of this product," absent "prior consent." (Hereinafter, the "Censorship Clause.")

      This Censorship Clause is unenforceable, illegal and deceptive. First, it is by its own terms an illegal restrictive covenant, which violates public policy and thus Executive Law 63(12). Under New York law, a restriction that broadly chills or restricts important rights -- here, of free speech and fair use -- without a legitimate purpose, will be struck down. This Censorship Clause restricts consumers and the media alike from reviewing the software or disclosing important design or product flaws. Yet it serves no legitimate purpose, such as protecting trade secrets or confidential material.

      The Censorship Clause is also a deceptive practice, contrary to New York GBL 349 and Executive Law 63(12). Specifically, it misinforms consumers that the company's prohibition against publication of reviews or benchmark tests (itself an illegal restriction) reflects existing "rules and regulations." Of course, no "rules and regulations" actually exist, under federal or state law -- a fact that most attorneys, including those who drafted the Censorship Clause, surely know. Misinforming consumers about their legal rights in this way is a deceptive practice, forbidden by New York GBL 349 as well as Executive Law 63(12). Finally, the Censorship Clause is also void and deceptive because it conflicts with the License Agreement contained with the company's boxed software. The boxed License Agreement, which is by its own terms the "entire Agreement between the parties," omits the Censorship Clause. Yet the company then places that very Clause on the face of the software diskette -- even though it is by the very terms of the License Agreement void and unenforceable. This, too, is an independent deceptive practice, prohibited by GBL 349 and Executive Law 63(12)."

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