The History of UCITA

The Uniform Computer Information Transaction Act (UCITA) is a proposed state contract law designed to standardize the licensing of software and all other forms of digital information. UCITA is a complex law that will adversely affect individual consumers, businesses, industries, libraries, schools and universities -- anyone using software or any kind of digital information.

UCITA originated as a new article -- Article 2B -- to the Uniform Commercial Code (the "UCC"), which was co-sponsored and drafted by the American Law Institute (ALI) and the National Conference of Commissioners on Uniform State Laws (NCCUSL). The drafting process took almost a decade. Typically, Uniform Commercial Codes proffered by ALI and NCCUSL are adopted by all 50 states because they are fair and balanced to both sides of the transaction, arrived at through a consensus between competing interests of the parties.

But this is not the case with UCITA. As the interests of software producers increasingly biased the perspective of the drafters and the law became increasingly complex, ALI withdrew its sponsorship and support for UCC 2B because it was convinced that NCCUSL would not change UCC 2B to make it fair. ALI's withdrawl from UCC 2B -- an unprecedented event -- killed any chance of it becoming part of the Uniform Commercial Code.

During the drafting, NCCUSL received letters from 26 attorneys general, the Federal Trade Commission and many intellectual property and commercial law professors indicating their concerns. But instead of letting UCC 2B die as it should have, NCCUSL recast UCC 2B as a stand-alone code and renamed it UCITA. Now, NCCUSL and certain software companies are urging state legislatures to enact UCITA, causing the present controversy and clamor among users to erupt.

In 2000, UCITA was passed by two states: Maryland and Virginia.

Maryland's law went into effect in October 2000. The Information Technology Board's UCITA Committee is evaluating the need for further legislation. None is planned in 2001.

Virginia is refining its law to go into effect July 1, 2001. After passage in 2000, the Joint Commission on Technology and Science (JCOTS) appointed a sub-committee to consider amendments to the law before its effective date. Seventy-four amendments were proposed by businesses, libraries and non-profits. Twenty-four were accepted and referred to the Legislature for passage. The amendment package is expected to pass in early 2001.

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