When PsyStar announced they would be offering their own Macintosch clone, pre-installed with Apple’s Mac OS X Leopard, they opened up a whole can of worms. Despite the fact that the company itself was shrouded in mystery and dubiousness, the possible implications of their actions sparkled an interesting debate here on OSNews as well as other discussion venues: can PsyStar and its users just discard Apple’s End User License Agreement for Leopard? Instead of relying on my own limited layman’s understanding of Dutch Common Law, I decided to contact Dutch legal experts, and ask for their opinions on Apple’s EULA, and EULAs in general.
Please note that whatever is said below is based on the information given by Dutch legal experts with proper credentials. I’m not talking about uncle Jim who has a brother-in-law who happens to be married to a retired lawyer. The information below comes from active Dutch lawyers, and consequently, are only applicable in The Netherlands.
In The Netherlands, it is quite common to have ‘legal insurance’ (by lack of a better term). It’s called rechtsbijstandverzekering, which means something along the lines of ‘justice assistance insurance’. This insurance guarantees that you will be given legal assistance in the form of funds, legal experts, and/or lawyers whenever necessary (granted the case in question falls within the scope of the insurance). I have fairly extensive legal insurance, which also grants me the right to ask for the opinions of legal experts even when there is no case. In other words, I can bug legal experts for free with trivial questions. This is source number one for my findings below, and they remain anonymous.
Source number two is Arnoud Engelfriet, a Dutch internet lawyer and ICT legal expert. His weblog Ius mentis details and explains various technology-related legal issues – a wealth of information on all sorts of legal issues we commonly discuss on OSNews. I have included several links to his findings in this article, even though they are written in Dutch. I would like to thank Arnoud for his detailed and easy-to-understand articles on Dutch technology-related legal issues. His information has been invaluable for this article.
The dreadful EULA
First, let me explain what an EULA actually is. The End User License Agreement details how you may use the software it applies to. When you go to the store to buy Super Awesome Garden Designer 8.0 Ultimate Edition, you do not actually buy the software in question – you buy the right to use said software. Software falls under copyright law, and as such, the author must grant you the right to use that software – and for that right, you pay money.
In The Netherlands, an EULA constitutes as a contract, and as such, you need to treat an EULA according to Contract Law. According to Engelfriet, this means there are four important steps in the process of establishing the legal power of an EULA: the formation of the contract, the offering of the contract, nullification of terms in the contract, and possible interference of other, possibly higher laws. Let’s start at the beginning.
For a contract to actually be a contract in the first place, there needs to be a party offering something, and a party accepting that offer. In the case of software, the offered something is the right to use that software. If you acquire software via legal means, you technically don’t need an EULA at all.
Software distributors solved this issue by forcing you to agree or disagree with the EULA during the installation process, before you can actually use the software – disagreement terminates the installation procedure, meaning you can’t use the software. According to Engelfriet, this is a legally sound construction in The Netherlands, as the distributor is not legally obliged to offer you a choice between the terms of the EULA, or the normal user rights regarding software as defined by article 45j and 45k of Dutch copyright Law (you are allowed to run software on one machine, and you are allowed to make a backup).
So, a software distributor may force you to agree or disagree with the EULA, even of if disagreement means you can no longer use that software. This seems awkward, and brings us to step two.
The first criterion is that the conditions of use must be presented prior or during the making of the agreement; in case of software bought in retail stores, it would be easy to argue the agreement is made during the actual purchase, which would mean that if an EULA is not presented then, it would be invalid.
However, there is a catch. To make sure that conditions of use (think: “all customers must wear a pink hat while in this store”) do not have to be specifically presented to each user, Dutch law states that telling a user that the conditions of use can be found at location xyz, without specifically stating the conditions themselves, is also a valid way of presenting conditions of use, regardless of whether the user actively agrees with the conditions or not. In the case of an electronic sale, there is an extra requirement (besides presenting them electronically): the user must have the ability to save the conditions of use (to a file).
The second criterion states that the conditions of use must be presented in the right way. As Engelfriet explains:
The main rule is that you should get a piece of paper on which the EULA can be found. When an EULA is only presented on-screen, it constitutes as an electronic agreement. Law then states that the EULA must be presented in such a way that it can be saved so that it is accessible at a later time. A .pdf or .doc file included in the zipfile satisfies this demand.
This last demand is crucial. The ability to copy/paste the text into a separate file does not satisfy this demand, as it requires too much effort on the user’s end. If there is no straightforward way to reread the EULA at a later date, it is invalid.
Because EULAs are conditions of use, the conditions in them may not be unreasonable. Engelfriet notes that “strict” does not mean “unreasonable”. In other words, something like restrictions upon on how many computers you may use software is not unreasonable – it is just strict. As the user, you will have to prove that the conditions in the EULA are unreasonable.
In addition, there is a list of prohibited conditions. A condition in the EULA that is prohibited can be nullified. Engelfriet: “Think of something like dismissing liability or a condition that only a Californian judge may decide over a disagreement.” This brings me to the Apple Mac OS X EULA that started this whole debate in the first place.
The Mac OS X EULA states:
2. Permitted License Uses and Restrictions.
A. Single Use. This License allows you to install, use and run one (1) copy of the Apple Software on a single Apple-labeled computer at a time. You agree not to install, use or run the Apple Software on any non-Apple-labeled computer, or to enable others to do so.
Is this infamous restriction unreasonable, and therefore can it be nullified? The anonymous source doesn’t think so:
The EULA specifically states that the software must be installed on an Apple computer, this is logical because it allows the software to function optimally. If you install the software on a non-Apple computer, there will be a large chance it will not function optimally. The distributor wants to prevent this by stating the software may only be installed on an Apple computer.
In other words, the infamous condition 2A cannot be nullified because it does not seem to be unreasonable at all.
The final point deals with how other laws might interfere with conditions in an EULA. Dutch law states that you are allowed to make a backup copy of your software – no matter what an EULA might say. Engelfriet does claim that such cases are rare.
Oooh what does this button do?
Is clicking “I agree” on a computer a legally binding way to engage in a contract? This was something I personally struggled with, almost at a moral level. I simply found it preposterous that clicking “I agree” had the same value as actually signing a contract in person with my autograph. Seeing just about any EULA uses this method, I also posed the following question to the anonymous legal expert: is clicking “I agree” similar to signing with an autograph?
Next, you asked if the “I agree” button is similar to an autograph. Via both means, you agree to something. Via the “I agree” button you agree with the conditions of use before you can use the software. So this is binding too, since you may view the conditions of use prior to using the software.
In the comments to the EULA article Engelfriet agrees with this notion, which leads to two legal experts agreeing on this matter.
The above means that assuming the distributor points me towards the EULA prior or during the sale, the EULA I agree with by clicking “I agree” is actually a valid contract according to Dutch Contract Law. The distributor can point me towards that EULA in several ways, for instance by including a notice on the box that says “The use of this software is governed by the rules put forth in the EULA. You can find the EULA at [internet address].” another possibility is to print the EULA on the box. The ability to view the EULA at a later date is crucial.
Effectively, if PsyStar was a Dutch company, Apple would have legs to stand on to legally force them to stop distributing Mac OS X Leopard pre-installed.
On a personal note, the findings of this article severely contradict my own opinions and interpretations of the law, which I posed in the comments section of the PsyStar article. It was my firm belief that an EULA could not be valid if it was not explicitly offered prior or during sale. What I did not realise, however (being a layman and all), was that the terms in an EULA are analogous to conditions of use – which is crucial for the validity of the EULA.
Rests me to repeat that the above is only valid in The Netherlands, and is based on the interpretation of the law by only two different legal experts – it could very well be that there are other experts that disagree with these interpretations. Such is the problem with the law.
If I were you, I’d get out that copy of Super Awesome Garden Designer 8.0 Ultimate Edition. Who knows what its EULA might say.
If you would like to see your thoughts or experiences with technology published, please consider writing an article for OSNews.