Attached Link: SoftMan vs Adobe

Although this case does not involve Poser or CL, it does set precedence for many of the concerns that have been raised about the P5 EULA. In addition, this case took place in California, the "home state" of CL. From the P5 EULA: "APPLICABLE LAW This EULA is governed by the laws of the state of California, except that federal and international law governs copyrights and registered trademark(s). Should any court having appropriate jurisdiction find any provision of this EULA invalid, that particular provision will be deemed deleted and will not affect the validity of any other provision of this EULA." Credit to Stormrage at PoserPros for finding the case.

Case? Give me the cite and I'll take a look. There is such a thing as an illegal clause in a contract, even an adhesion contract.

Oh, never mind, I just clicked on the link. Let me play a bit.

A preliminary injunction is how the court might stop someone from doing something BEFORE a judgment is reached. This is a constitutional issue because it kinda looks like "guilty until proven innocent" (though its not quite that, but similar). So, in order to get an injunction, you have to show that there is a high likelihood that you will win. Read the legal standard in the case, that sets the stage. Looks like they revisited the sale vs. license argument and cited cases that reflect software as being sold rather than licensed (I have long since believed that the 'license' agreement is not valid since it really and truely is a sale). The court did not bind Softman to the shrink wrap adhesion agreement because that was not how they obtained the software. Beware, because for us, that's how we obtained most of the software we bought and opened. I say most because some software is a web DL and whether or not a web adhesion agreement is enforceable is not yet challenged to my knowledge. Softman is entitled to use the copy of the software as an owner within the rights of copyright law. Be careful there too. While you can, as an owner, sell your copy(like selling a book), you cannot make copies of it and redistribute it (which is a copywrite thing). Adobe did not show that they would be irrepairably harmed. As large as they are, they can likely recover from the harm that will occur during the course of the trial. Keep in mind that if they win, softman has to stop doing what they do. Further, Softman was doing this since '97 and there was no showing of irrepairable harm from that time. (Note: I think a good comparison of lost revenue to warez and unauthorized usages would sway this argument the other way. However, there is little data on economic loss due to warez etc, that can be used in general and for the injunction, it would have to be a specific company statistic unique to this software, which would cost a fortune to compile.) Court looked to public policy and leaned towards the side of oversophistication on the part of the EULA. Its about time! Guess the backlash to MS is starting to surface, which I thought it would. Court goes back to the shrinkwrap and leans towards the strength of an adhesion contract that an end user has to face in making the 'rip it open' decision. Yet at the same time, acknowledges the sophistication issue again in how some companies emasculate general law with their EULA's. As for trademark and the Lanham act, I guess there was merit to raise that issue, but unless the interface is similar to adobe's, there's likely no issue here. However, on a preliminary injunction, the Judge would not see the expert testimony and interface similarities. That's for later at the trial. So Adobe lost the preliminary injunction. Quite frankly, its very hard to win one. You have to be at the level of a summary judgment to win one from what I've seen. Thus, not liable until proven liable is the decision here on the prelim. Make no mistake, Adobe may still win their case, and most likely will. While it appears to me to be a clear cut copywrite violation, the standard for a prelim of irreparable harm was not met. Ok, I typed fast and the secretary isn't here to spellcheck. Just my 2 cents. I do know of one 3d software company that has found a way to bypass all this and control their software well beyond the attempts of adobe, but I won't say how they did it cuz we really don't want to give anyone any ideas.

Ronmolina, I agree with you that the initial post misunderstands what was read. That's why I posted a bit of an explanation. Does warm my heart a bit to see a judge look at public policy and traditional law rather than the corporate monster.

Ron, don't delete, you had some good things to say. By the way, the reason my crystal ball suggests that Adobe will win is because there appear to be several judicial admissions from softman that the code was taken and redistrubuted (even if it was "parts" of the code). Code is copywrite. I suspect the adobe attorneys will be bringing a MSJ (Motion for Summary Judgment) immediately after the depos, rogs, and admissions are completed.

It's a license agreement if they sell you a license to use the software under their conditions, so it's a license because they say it is. Personally I can go along with that, especially if I can transfer the license to somebody else after I quit using it. The part I'm unclear on is how they can expect a court to allow that any illegal clause doesn't invalidate the entire license. Like they're telling the court beforehand what's legal. It doesn't matter for an end user like me, but it could apply to their competitor.

Oh, let me clarify a bit. There are several ways that we have laws. Congress can enact a law which becomes a federal statute. A state can pass a law which becomes a statute. The US Supreme Court can issue a ruling that interprets the Constitution and thereby modifies the 'meaning' of a federal or state statute. A Federal district or a State can issue a ruling (caselaw) that is consistant with the upper court rulings and also clarifies a statute, etc. An attorney has to grapple with all of this and put it together in favor of the client. Opposing counsel does the same. That's the adversary issue where two attorneys read the same stuff and argue in favor of their client. The Judge reads both sides and researches on their own and makes a decision. Appeal courts look at those decisions and review what the judge did. This case is in the 9th circuit. That's a trial court and the bottom level. Its above the local state court because the parties are in different states with financial concerns over $75k (which is one way that suits end up on federal court rather than state court). When in Fed Ct, the substantive law of the land controls and federal procedures control over state procedures. These procedures can make or break a case for a client. So its a real quagmire and attorneys have lots to do to get it all put together in favor of their clients. That said, there's a long standing policy (caselaw, statutes, etc) that say people can make any agreement they want so long as it doesn't go against certain other laws. If it does, its illegal. Also, contract verbage is interpreted against the drafter, or in favor of the non drafter. So if there is a dispute about what something means, and the dispute is valid, there's a chance the contract will be interpreted in favor of Softman. But if the terms are clear enough, then it will be interpreted in favor of Adobe. I think they are clear enough in light of federal copywrite law. So, while I can contract with you in Nevada to sell a car at 122% finance charge (since there is no usery laws there) the same contract would be invalid as to the interest rate in other states and the court would adopt a reading consistent with the local state laws and reduce the interest rate. EVEN THOUGH BOTH PARTIES SIGNED. That's what illegal clauses are about. Its a matter of protecting the unsophisticated. Public policy, etc. The law is designed not to favor the person who has the advantage (though it does protect there a bit), but to favor the common person. Fair is fair and unfair is unfair. Does that help?

and a license is not a license just because someone says it is. If I dress up a rock to look like a penguin, its still a rock. That's what the court is doing by saying that even though the EULA is a license, it appears to be a sale.

Ok, I think someone missed something here. Softman wasn't distributing "code" they were taking bundled software packages apart and reselling the individual program disks. What everyone seems to forget here is that Adobe got their money from Softman when they originally purchased the bundled programs. What is upsetting Adobe, and what prompted them to file the lawsuit in the first place was that Softman was reselling the product as individual items for more than they paid for it as part of the bundle. I also agree with the judge's statement that Softman cannot be bound by the EULA because they never installed the software and therefore never agreed to the terms of the EULA. The same way that if I happen to get two copies of a software package for my birthday or Christmas, I can keep one, install it, use it, register it, etc. and I can give away or sell or do anything I darn well please with the other copy so long as I don't install it on my computer first (which, when you think about it, would be a rather stupid thing to do) and there's not a darn thing anyone on god's green earth can do about it. I can go down to any store that sells computer software, buy any program and then give it or sell it to anyone I darn well please as long as I've never installed it or registered it. After all, how would anyone even prove that I bought it? Especially if I paid cash? It's not like my name is on a receipt somewhere in some store's files. Kate (prepared to cheerfully ignore any and all flames aimed in her direction)

{It's not like my name is on a receipt somewhere in some store's files.} That's what you think, Kate. :-) Actually, it's quite frightening the info some stores have on you even when you pay with cash. Ever blindly give them your phone number when you check out. I never do, but the clerks look at me like I'm really weird when I ask "WHY?", so most people must.

Actually, the only place that has ever asked for my phone number was Radio Shack and I told them they didn't need to know that in order to sell me a 9 volt battery and when the salesman said "but we need it for our records" I said "you know what? I can just buy batteries at the supermarket instead". Now, the places where I'm most likely to buy software have never asked me for any personal information, not even my name. Strange world, ain't it? Kate

Yes, it looks like another case of Big business upset at not getting all the money they feel they so richly deserve. Adobe wants the extra money that softman is getting from splitting up the bundle. If Adobe wanted to end this simply, they could just stop selling bundles.

EricofSD,

You seem to be very well-versed in the law. Glad to know that you picked out some of the finer points within the case.

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As stated in the original post, the case does not directly involve CL or Poser, but the case does describe some legal precedence regarding the EULA vs Copyright Law discussions that recently went on here regarding CL and the P5 EULA.

Some of the pertinent points within the case that I noticed are (any emphasis added is mine):

1. 'the owner of a particular copy . . . lawfully made under this title . . . is entitled, without the authority of the copyright owner, to sell or otherwise dispose of the possession of that copy.' 17 U.S.C. 109(a).
2. The Adobe license compels third-parties to relinquish rights that the third-parties enjoy under copyright law. [Subsequent Sales.]
3. This license provision [transferring or assigning licensed software] conflicts with the first sale doctrine in copyright law, which gives the owner of a particular copy of a copyrighted work the right to dispose of that copy without the permission of the copyright owner.
4. Other courts have reached the same conclusion: software is sold and not licensed.
5. If a transaction involves a single payment giving the buyer an unlimited period in which it has a right to possession, the transaction is a sale.
6. A number of courts that have addressed the validity of the shrinkwrap license have found them to be invalid, characterizing them as contracts of adhesion, unconscionable, and/or unacceptable pursuant to the Uniform Commercial Code. These courts have refused to recognize a bargain in shrinkwrap license that is not signed by the party against whom it is enforced. In Step-Saver, the Third Circuit found that the terms of a contract were formed when the parties shipped, received and paid for the product. Therefore, the software shrinkwrap agreement constituted additional terms to the contract, and under Uniform Commercial Code 2-207 (governing commercial counter-offers), these terms were invalid without express assent by the purchaser.
7. The Court finds that the provisions contained in Adobe's EULA purport to diminish the rights of customers to use the software in ways ordinarily enjoyed by customers under copyright law.
8. Sound policy rationales support the analysis of those courts that have found shrinkwrap licenses to be unenforceable.
9. A system of "licensing" which grants software publishers this degree of unchecked power to control the market deserves to be the object of careful scrutiny.

cyber, you did some research, as opposed to my off the cuff podium speech. Some observations that match your numbers ... 2. The relinquishing of rights might well be an illegal term of the contract. Depends on the facts. One thing to remember is that there are gov't laws and party laws. Party laws are reflected in contractual arrangements. If the contract limits Constitutional rights or force a violation of a law, its not ok. Outside of that, parties are free to write their own law (contract) which is often referred to as a face to face negotiation. Adheshion is not face to face. And I didn't shake Bill G's hand when I bought Win OS. 3. I agree. 4. Most is sold. As I said, I know of one that doesn't fall into this category. 5. Definitely agree. 6. Adhesion contracts can be valid as long as they are not illegal or oversophisticated. UCC 2 deals with merchants. End users are not merchants. So this is a difference between adobe and our gripes. The adobe case is between merchants. Our gripe on the EULA is, in part, between a merchant and a non merchant. The UCC has specific distinctions between the two. Market place people may well be treated as merchants. Hobbyists are definitely not merchants. Also, UCC 2-207 is often referred to as part of the "battle of the forms" where each merchant has a form with fine print on it that doesn't match a face to face negotiation. When merchant A has a form for a purchase order that spells out certain terms, and merchant B has an invoice that spells out different terms (cuz one bought from office max and the other bought the forms from office depot - or wrote their own), a battle can ensue as to what the contract offer/acceptance really is. The UCC seeks to resolve that. This said, the UCC is only the law when in Federal Court. When in State court, the state law applies and not all states have adopted the UCC. Some have adopted only parts of the UCC. So, it depends on what jurisdiction the suit is in to resolve the applicable controlling rules. 7. Agreed, and this is a public policy issue as well as an illegality issue. 8-9 I have long since believed this. All this aside, it may cost big bucks to defend against a suit. Granted the defendant may be entitled to attorney fees if they win, they will likely not find a lawyer who takes this on a contingency. So many roll over and settle as a sound business decision instead of fighting. That's an unfortunate side effect that lets the big guy win even when wrong. Well done, Cyber. ******************************** My Disclaimer: The views of this Poser Dork do not necessarily reflect the views of this station or its political stand.

EricofSD, Thanks for your compliments. However, Stormrage still gets credit for finding the case so I could "nit-pick" it to death and apply it to the P5 EULA. :0) I am sure that, by now, I am probably looked upon by many as being anti-CL/Poser. I am more concerned with consumer advocacy/protection than "company bashing", or whatever terms people may decide to use. In the end, I think that by bringing up these issues and allowing the company (be it CL, DAZ, Microsoft, etc) to address them benefits all consumers. I hope that this whole debacle will get solved to the mutual satisfaction of all sides. I have seen P5 and it lessens some of the issues I came across in P4PP, which would be beneficial for what I need it for. However, until such ambiguities are clarified, I find it hard to conscientiously purchase or recommend the product.