1. Cancel Carte Blanche for the Information Industries: Federalizing U.C.C. Article 2.
- Author
-
Rustad, Michael L.
- Subjects
Warranty -- Laws, regulations and rules ,Commercial arbitration -- Laws, regulations and rules ,Limitation of damages -- Laws, regulations and rules ,Negligence -- Laws, regulations and rules ,Products liability -- Laws, regulations and rules ,Computer crimes -- Laws, regulations and rules ,Government regulation ,Product licensing ,Computer crime ,Uniform Commercial Code (U.C.C. 2) - Abstract
TABLE OF CONTENTS ABSTRACT 59 TABLE OF CONTENTS 61 I. INTRODUCTION 63 II. PART I: TODAY'S SOFTWARE CRISIS 66 A. The Financial Cost of Software Defects 66 B. Software Vulnerabilities [...], Warranty disclaimers, caps on damages, predispute mandatory arbitration, and anti-class action waivers constitute what I call, "no responsibility" or "rights foreclosure clauses" in computer contracts. This is the first empirical study of how the information industries, which include the 100 largest software companies and the 100 largest digital companies, deploy one-sided warranty disclaimers, caps on damages, and predispute mandatory arbitration clauses coupled with class action waivers to shift responsibility for defective software to the user communities. This gives the information industries carte blanche to release dangerously defective software without consequences. In their standard form contracts, the industries do whatever they wish by incorporating their designed terms and conditions. The software industry assert contractual rights without providing corresponding meaningful remedies for breach in their computer contracts. The net effect of these no responsibility clauses is to require users to waive their right to a judicial forum in favor of arbitration, where the stronger party is at a distinct advantage. Congress needs to enact a federal U.C.C. Article 2 reform that will invalidate no responsibility clauses, thus restoring mutuality in software license agreements.
- Published
- 2024