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What Is UCITA?


Computer - Under UCITA, an electronic device that accepts information in a digital or similar form and manipulates it for a result based on a sequence of instructions.

Relevance: This definition would allow all sorts of devices to be called computers. Therefore, it allows UCITA to regulate a tremendous number of products, some of which we might not ordinarily consider as computers. One example would be pacemakers. These devices use "software" to regulate one's heart beat and they would be considered "computers" under UCITA.

Computer Information - Under UCITA, means information in electronic form which is obtained from or through the use of a computer or which is in a form capable of being processed by a computer. The term includes a copy of the information and any documentation or packaging associated with the copy.

Relevance: This definition allows ANYTHING digital to fall within UCITA's jurisdiction. Electronic books, music, movies, computer software, on-line magazines, web sites, anything that might be used within the broad definition of a computer.

Computer Information Transaction - Under UCITA, means an agreement or the performance of it to create, modify, transfer, or license computer information. The term includes a support contract under Section 612.

Relevance: This definition permits shrink-wrap/click-on license, i.e. clicking "I Agree" when installing software, signing-up for Internet access, or using an electronic book.

Consumer - Under UCITA, means an individual who is a licensee of information or informational rights that the individual at the time of contracting intended to be used primarily for personal, family, or household purposes. The term does not include an individual who is a licensee primarily for professional or commercial purposes, including agriculture, business management, and investment management other than management of the individual's personal or family investments.

Relevance: This is an extremely narrow definition. Under this definition, a teacher that uses his or her personal copy of a spreadsheet to maintain and calculate grades would be considered a business user of the software. If that same teacher used his or her personal Internet account to research lesson plans, those activities would be considered business uses of the service. The result, business users do not have the same rights as consumers and this definition allows software vendors to exclude large numbers of software customers from consumer protections.

Disclaimer - A term in a license that allows a person or organization to refuse responsibility. For instance, used cars come with the disclaimer "AS IS." They are sold with no warranty of any kind.

Relevance: Many software vendors sell new software "AS IS" by disclaiming responsibility for defects in the software.

Electronic Self-Help - The process where a software vendor or licensor may electronically disable, remove, or otherwise prevent the usage of computer information. This could be done remotely through "back doors" or hidden entrances in the software or the software may have hidden shut-down commands that may be activated by phone or through other mechanisms.

Relevance: The ability to shut down a company's mission critical software through electronic self-help would enable unscrupulous software vendors to "blackmail" companies into paying more money by merely threatening to shut down their software. Electronic self-help also poses serious security issues for software because any weakness or holes in the software may not only be used by the licensor, but also disgruntled employees or malicious third parties with the skills to exploit them. Proponents will say that restrictions in UCITA for using self-help protect users. However, by complying with the recipe outlined in UCITA, software vendors are granted a "safe-harbor" that relieves them from any liability for the damages caused to the user.

Fair Use - Copyright law affords users the right to make "fair use" of copyrighted materials without permission from the copyright holder. A fair use (Section 107) is a use permitted by the copyright statute that might otherwise be infringing. Fair use is necessary to achieve the constitutional purpose of copyright -- to advance knowledge and promote learning. Thus, the public needs to make some uses of works in order to create new works. Fair use applies to all copyrighted works regardless of format. As a matter of fair use, a user may, under certain circumstances, copy (generally a small portion of a copyrighted work) or distribute, display, perform, or prepare a derivative work based on a copyrighted work without copyright holder authorization. However, a user may not infringe copyright simply to avoid purchasing a work.

First Sale - The First Sale Doctrine of federal copyright law limits the exclusive right of distribution to copyrighted works. First Sale is a specific exemption in the federal copyright law that allows an individual or a business to the right to transfer, resell, rent or loan lawfully acquired copies.

Relevance: UCITA removes this legitimate right by categorizing transactions of software and computer information as a "license" rather than a sale.

Goods - Under UCITA, all things that are movable at the time relevant to the computer information transaction.

Relevance: This refers to anything "physical" included with the computer information, including but not limited to a computer with bundled software, a digital camera with software, or a law journal CD packaged with a paper version of the information. This definition does not include computer software and digital information. Most state consumer laws deal with either goods or services. According to UCITA software is neither and is therefore not protected under those laws.

Licensee - Under UCITA, a person entitled by agreement to acquire or exercise rights in, or to have access to or use of, computer information under an agreement to which UCITA applies.

Relevance: This is the customer.

Licensor - Under UCITA, a person obligated by agreement to transfer or create rights in, or to give access to or use of, computer information or informational rights in it under an agreement to which UCITA applies.

Relevance: This is the vendor or seller of the software.

Mass Market License - Under UCITA, a standard form used in a mass-market-transaction.

Relevance: This definition applies to any NON-NEGOTIATED license used in products generally available to the public. For instance software purchased at your local office supply store relies on a non-negotiated standard license. This type of license is often referred to as "click-on" or "shrink-wrap" because you agree to the terms of this contract by opening the plastic wrapping on the box or by clicking "I Agree." Normally, the customer cannot see these contracts until AFTER he or she has paid for the product and brought it home.

Reverse-Engineering - Under UCITA, the process of examining a computer program or digital product. This process is performed for many legitimate reasons, including debugging and developing interoperable products. Reverse-engineering is also used academically to teach students how software is constructed and to critique the software.

Relevance: UCITA would validate software licensing terms forbidding this legitimate use of the software. Reverse-engineering is a completely legal and permitted process for any purchaser of goods and for the "owner" of a copy of software under U.S. copyright law. UCITA removes this legitimate right by categorizing transactions of software and computer information as a "license" rather than a sale.

Shrink-Wrap/Click-On Licenses - Under UCITA, these are "contracts" that are created by opening the plastic wrap on the outside of the software or by clicking "I agree" during set-up.

Relevance: UCITA condones the practice of binding consumers to terms that are hidden until after purchase. This practice relieves vendors from competing with each other on license terms because these shrink-wrap/click-on licenses cannot be read before the software is purchased and brought home. These licenses are not negotiated, they are "take-it-or-leave-it" licenses.

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