Digital Copyright Canada

SCO's argument asking for more time is interesting, because we learn that Novell asked to -- and SCO agreed they could -- attach 60 more documents to the Appendix. And Stuart Singer, who takes credit in his bio on Boies Schiller's website for representing SCO as lead counsel at this same court of appeals the last time SCO appealed, is busy with another case, working on a preliminary injunction proceeding. Well. Almost. It doesn't say the "SCO" word:Won appellate decision from Tenth Circuit (August 2009) regarding ownership of copyrights and contract rights for the UNIX operating system. Heh heh. They are incorrigible. Not exactly the whole story, eh? What he won was a jury trial to *determine* the ownership of UNIX and UnixWare copyrights and contract rights, but the jury at the trial said Novell retained ownership of the copyrights for UNIX and UnixWare in 1995-6, and the judge ruled that Novell had the right to waive contractual violations, so SCO lost completely, despite the Court of Appeals granting SCO that extra bite of the apple with a jury trial. Which, I must point out, reached exactly the same conclusion that the first judge had on summary judgment way back in August of 2007. Singer's bio makes it sound like SCO prevailed. No wonder Bloomberg got it so wrong today [see News Picks]. That's the trouble with fibs and spin. They detach your mind from reality. Over time, that can't be good for anybody's mental health.

Preliminary injunctions are very, very hard to win, because one of the things you have to demonstrate early in the case, meaning before you've done discovery, is that you probably will win in the end, so it's a legitimate excuse this time. But what might those extra 60 documents be, I wonder?

[Update: This post was featured on Slashdot.]

The case law governing software license agreements has evolved dramatically over the past 20 years as cataloged by Doug Phillips in his book The Software License Unveiled. One of the recent trends in this evolution, as correctly noted by Phillips, is that courts will often honor contractual limitations of liability which appear in these agreements, which seek to insulate the software company from various claims and categories of damages, notwithstanding the lack of bargaining power on the part of the user. The case law has been animated, in large part, by the normative economics of Judges associated with the University of Chicago. Certain courts, as a result, could be fairly criticized as being institutionally hostile to the user public at large. Phillips notes that a New York appellate court, in Moore v. Microsoft Corp., 741 N.Y.S.2d 91 (N.Y. App. Div. 2002), went so far as to hold that a contractual limitation of liability barred pursuit of claims for deceptive trade practices. Although the general rule is that deceit-based claims, as well as intentional torts, cannot be contractually waived in advance, there are various doctrines, exceptions, and findings that a court might use (or misuse) to sidestep the general rule. Such rulings are unsurprising at this point, because the user, as chronicled by Phillips, has been dying a slow death under the decisional law, with software license agreements routinely interpreted in favor of software companies on any number of issues.

It was against this backdrop that, on August 4, 2010, a software company seeking to use a contractual limitation of liability as a basis to dismiss various tort claims, met with stunning defeat. The U.S. District Court for the District of Hawaii ruled that the plaintiff’s gross negligence claims could proceed against the software company and that the contractual limitation of liability did not foreclose a potential recovery of punitive damages based on such claims. Furthermore, the matter remains in federal court in Hawaii notwithstanding a forum selection clause (section 15 of the User Agreement) in which the user apparently agreed “that any action or proceeding instituted under this Agreement shall be brought only in State courts of Travis County, State of Texas.”

The case is Smallwood v. NCsoft Corp., and involved the massively multiplayer, subscription-based online fantasy roll-playing game “Lineage II.” The plaintiff, a subscriber, alleged that the software company failed to warn of the “danger of psychological dependence or addiction from continued play” and that he had suffered physically from an addiction to the game. The plaintiff reportedly played Lineage II for 20,000 hours from 2004 through 2009. (Is there any higher accolade for a gaming company?) The plaintiff also alleged that, in September of 2009, he was “locked out” and “banned” from the game. The plaintiff claimed that the software company had told him he was banned “for engaging in an elaborate scheme to create real money transfers.” The plaintiff, in his Second Amended Complaint, couched his claims against the software company in terms of 8 separate counts: (1) misrepresentation/deceit, (2) unfair and deceptive trace practices, (3) defamation/libel/slander, (4) negligence, (5) gross negligence, (6) intentional infliction of emotional distress, (7) negligent infliction of emotional distress and (8) punitive damages.

The software company undertook to stop the lawsuit dead in its tracks and filed a motion to dismiss all counts. The defendants argued, among other things, that Section 12 of the User Agreement, entitled “Limitation of Liability,” foreclosed essentially any recovery. The provision, which is common in the industry, purported to cap the amount of the software company’s liability at the amount of the user’s account fees, the price of additional features, or the amount paid by the user to the software company in the preceding six months, whichever was less. The provision also stated that it barred incidental, consequential, and punitive damages:

12. Limitation of Liability
* * *
IN NO EVENT SHALL NC INTERACTIVE . . . BE LIABLE TO YOU OR TO ANY
THIRD PARTY FOR ANY SPECIAL, INCIDENTAL, CONSEQUENTIAL,
PUNITIVE OR EXEMPLARY DAMAGES . . . REGARDLESS OF THE THEORY
OF LIABILITY (INCLUDING CONTRACT, NEGLIGENCE, OR STRICT
LIABILITY) ARISING OUT OF OR IN CONNECTION WITH THE SERVICE,
THE SOFTWARE, YOUR ACCOUNT OR THIS AGREEMENT WHICH MAY BE
INCURRED BY YOU . . . .

The Court considered the parties’ arguments and then penned a whopping 49-page decision granting the software company’s motion to dismiss, but only partially. The Court determined that the User Agreement contained a valid “choice of law” provision stating that Texas law would govern the interpretation of the contract. However, the Court then ruled that both Texas and Hawaii law did not permit people to waive in advance their ability to make gross negligence claims. The plaintiff's remaining negligence claims survived as well. The claims based on gross negligence remained viable for the full range of tort damages, including punitive damages, whereas the straight-up negligence-based claims would be subject to the contractually agreed on limitation on damages.

The fact that the gross negligence claims survived is significant in and of itself, but in reality having the right to sue for “gross negligence” is the functional equivalent of having the right to sue for straight-up negligence as well—thus radically broadening the scope of claims that (according to the court) cannot be waived in a User Agreement. Although it is true that negligence and gross negligence differ in theory (“negligence” = breach of the duty of ordinary care in the circumstances; “gross negligence” = conduct much worse than negligence), it is nearly impossible to pin down with precision the dividing line between the two concepts. Interestingly, Wikipedia notes that the Brits broadly distrust the concept of gross negligence and that, as far back as 1843, in Wilson v. Brett, Baron Rolfe “could see no difference between negligence and gross negligence; that it was the same thing, with the addition of a vituperative epithet.” True indeed.

The lack of a clear dividing line is an important tactical consideration. A plaintiff often pleads a single set of facts as supporting claims for both negligence and gross negligence and—in the absence of a contractual limitation on liability—expects both claims to survive a motion to dismiss, survive a motion for summary judgment, and make it to a jury. When the contractual limitation of liability is introduced into the mix, and the plaintiff is forced to give up the pure negligence claims, it hardly matters: the gross negligence claims—based on the exact same facts—cannot be waived (at least under Texas and Hawaii law) and therefore survive, at least up to the point of trial. Courts will not decide genuine factual disputes—that is the function of the jury. This is usually enough for the plaintiff, since the overwhelming majority of cases settle. Thus, a gross negligence claim, in most situations, is the functional equivalent of a negligence claim. For these reasons, the Smallwood decision, if it stands, may achieve some lasting significance in the software license wars.

A friend had trouble with their iPhone yesterday and enlisted me in a trip to the Apple Store.

(The Apple store in Lenox Square Mall, Atlanta, from Apple.com.)

Three hours later I realized that Apple is back in the same box Steve Jobs put it in over 25 years ago.

To continue the morning’s baseball theme, It was deja vu all over again.

My friend’s WiFi was on the fritz. The battery was losing power faster than a politician under indictment. No problem, he said. I have an appointment.

The store was tightly packed with people, even though it was Monday afternoon. We were called at 3:18 for an appointment scheduled for 3. After examining the unit our hyper-friendly Apple geek suggested a reboot. No good. Sadly he suggested reloading the operating system. Some 15 minutes later, still no good.

OK, he said, we can fix it, but it will take time because it’s a hardware problem. Wait, my friend said, that’s my home phone. Can’t I just buy another?

Sure, the geek replied. Just get in this line here. How long is this line here, my friend asked. About an hour-and-a-half to two hours, came the reply from the line monitor.

Some 45 minutes later, while my friend frantically used his AT&T data minutes to try and order a new phone online while standing in the Apple phone ordering line, his girlfriend arrived like cavalry to the rescue. She wasn’t under Apple’s spell. She pulled us out and said my friend could buy something later.

Suddenly, in the mall parking lot, a miracle occurred. There, right across the street, was an AT&T store. A company-owned store, its happy little death star sparkling in the sunlight.

Eureka, my friend said. They sell iPhones. So we went over.

It was night-and-day. By which I mean the AT&T store was nearly empty. The help was not overwhelmed. They were waiting for us. We were taken to a man named Scott, who engaged my friend in earnest conversation while I perused the inventory.

Look, I said, this Samsung CaptivaCaptivate costs just what the iPhone would. It’s an Android phone designed to look just like the iPhone, and it seems to have all the same features as the iPhone. Hint, hint. (Thanks to ITGuy08 for catching the misspelling.)

Well, Scott replied, we don’t have any iPhones in stock, but I can get you into a Captiva right now. A half-hour or so later my friend was a happy Android user, asking me if I wanted an iBrick.

There are some important lessons here:

1. Apple claims to be unworried because it is selling iPhones as fast as it can make them. Even faster.
2. Apple is not scaled to meet demand for its product, and certainly not for its retail services.
3. Alternatives with the same look-and-feel are available now.

Back in the 1980s, PC users had to live through 6 years of FUD, waiting for Microsoft or IBM to get their act together and deliver a graphical user interface similar to the Apple Mac, introduced in 1984. Apple had 5 years to own the market, yet its insistence on complete control meant it couldn’t meet demand. Microsoft won.

It’s happening again, Steve. Only it didn’t take Microsoft 6 years to match you. Open source did it in two. And that’s why Android phones now out-sell the iPhone. They’re not better, they’re just available, and you don’t have to go into the 7th circle of Apple Hell to get one.

Over at his other job, our David Gewirtz suggests that, with the absorption of Sun into Oracle, open source badly needs an open source patron and that IBM should apply.

I previously suggested Dell for this role, saying it would be in their business interest to commit to this course. The problem with IBM is somewhat different. (Picture from Wikipedia.)

IBM has learned over the last two decades that it can succeed while avoiding the trips and dramas, the strum and drang, which pass the news cycles in the computer press. Sometimes no news is indeed good news, especially in computing, because it’s not about you but the customer.

But David has a point. All of open source benefited from having important projects in safe hands. With those projects no longer in safe hands a pall has settled, threatening to become a malaise.

IBM is in a unique position to fight that. It has invested heavily in Java and Linux. It passed its Symphony suite over to OpenOffice.org years ago, and now sells support while offering it for download there.

IBM has also benefited from open source through Eclipse and other projects. No other company has earned as much money from open source as IBM. No one else does a better job of giving the lie to the idea that open source is a money loser than IBM.

IBM has become the Stan Musial of open source. (That’s The Man himself, on Wikipedia, during 2008’s Stan Musial Day in St. Louis.)

It’s an open source Hall of Famer, with an excellent reputation, but few people outside its home base know the story, just as Musial is little known outside his hometown and certain retirement homes. (His SI cover this summer was, believe it or not, his first as a solo, although he was the magazine’s Sportsman of the Year for 1957.)

Now, if I can extricate myself from my own childhood we’ll go on.

Despite the nonsense of our Supreme Court (they also think tomatoes are vegetables) companies are not people. They can be immortal, renewing themselves with every generation, adapting constantly, changing with the times.

IBM has proven this. The Watsons are dead. Lou Gerstner is long gone. Elvis has left the building. Yet IBM goes on, its market cap still bigger than Google’s or Oracle’s. If open source needs a hero to step up, IBM is best positioned for the job.

One might even argue that IBM owes this to open source. Having benefited from open source for over a decade, unifying its product lines under Linux, sharing development costs with rivals, and making a ton of money, IBM really should give back.

This is something open source teaches all of us. You benefit more from open source when you give than when you just take. In fact the more you give the more you benefit.

I’m not asking IBM to do something against its interests here. Quite the contrary. It is very much in IBM’s own interest that it step up and lead the open source movement. That’s something IBM representatives have been telling their customers and business partners for some time, that you give in order to get.

OpenBravo recently released an upgraded open source ERP solution aimed at small and medium-sized businesses.

QuickStart 2 features more than 12 business process flows including Order to Cash, Procure to Pay, and Bank Statement to Bank Reconciliation.

The Barcelona-based developer also offers subscription-based pricing as well as cloud deployment for SMBs that want automation and optimization of accounting, sales order processing, inventory, and procurement processes without deploying on-premise.

Version 2 also provides Advanced Payable and Receivables anagement module and a revised payment system that makes data and cash flow mopre transparent to users.

Drew Wilson of ZeroPaid has posted a 3 part interview (Part 1,Part 2,Part 3)with me discussing Copyright and Bill C-32.

The Great Google is wearing sackcloth and ashes this week, whipping up public resentment against legal rival Oracle by staying away from JavaOne, and quietly encouraging sales of James Gosling’s nifty anti-Oracle t-shirts. (Picture from Cafepress.)

But in publicly portraying itself as the Luke Skywalker of open source (and Larry Ellison as Darth Vader) Google is taking a risk. That’s right, someone might find out Oracle is its father. That would be a real disturbance in the force.

The problem, as Bruce Perens makes clear at his blog, is that this lawsuit isn’t really about open source. Google deliberately violated the patent freedom grant given by Sun, using a user interface toolkit not found in Java ME or Java SE.

Java on the web doesn’t seem to have the problems that Google built into Android, its users can stay within the patent grant without trouble.

Oops. Instead, Android implements the Dalvik Virtual Machine, recompiling  the Harmony class libraries on Apache’s version of Java SE. It then targets the new version at the same markets Oracle has identified.

Or, as Charles Nutter notes in his excellent summation of the issues, “Dalvik is not a JVM…it just plays one on TV.” Google made Java better, which is technically a good thing. But it did so in a legally questionable way.

One point even the fiercest open source advocates will insist on is that your rights to change code are not unlimited. They are defined by a license. If Google tweaked a proprietary version of Java it may lack the commercial rights to what it has done.

In other words, as painful as it may be admit this, Oracle may indeed have a case even Richard Stallman is bound to respect.

Google, who’s your daddy?

Canadians: Now that summer's over, it's your last chance to select your favorite young adult reads in Indigo's summerlong Teen Read Awards. They're soliciting Canadians' daily votes for great books for teens to read, as part of a longer and larger promotion of teen reading and literacy. I'm honored to note that my latest young adult novel For the Win is in the final heat!

BEST CANADIAN READ NOMINEES

Again Mella returned to the tripod and lantern. There were faint clinkings. Maybe she was cooking up a stir-fry in the wok. That wasn't really a very amusing thought; I was getting bored fast. I was tempted to turn around and see what was going on, but I'd been told quite explicitly not to do that, so I didn't. That moment was when I first noticed, what, a shimmer? a disturbance? in the forest in front of me.

I've just done the online checkin for my flight to Australia tomorrow for the Melbourne Writers' Festival and the World Science Fiction Convention (also in Melbourne), so now seems like a good time to publish my schedule of appearances for the week that I'm there:

Melbourne Writers' Festival:
Lecture, 1800h, Thursday, September 2, RMIT Capitol Theatre: Big Ideas: Copyright versus Creativity

(Note: the seminar announced for Sept 1 has been rescheduled; I'll post here when I have the final info)

World Science Fiction Convention:
Border crossing: YA authors writing for adults and vice versa (Thursday, Sept 2, 1500h, Room 212)

Making a living: Professional writing for speculative fiction authors (Friday, Sept 3, 1200h, Room 219)

Copyright in the 21st Century (Saturday, Sept 4, 1000h, Room 203)

To market: How to sell your short stories (Saturday, Sept 4, 1100h, Room P3)

Did the future just arrive?: The e-book and the publishing industry (Saturday, Sept 4, 1300h, Room P3)

The writer and the audience: Online interaction and public personae (Saturday, Sept 4, 1500h Room 204)

Reading (Sunday, Sept 5, 1000h)

Kaffeeklatsch (Sunday, Sept 5, 1100h)

The future of short fiction (Monday, Sept 5, 1100h, Room 203

Dirty feed (Monday, Sept 5, 1200h, Room 210)

I think it ought to inspire you, reading Allen's complaint [PDF], that it might get you to the tipping point, or at least help you to understand why most engineers do hate software patents, because they are a drain on the economy and a hindrance to innovation. So we did Allen's complaint as text, sort of as Exhibit A, shall we say, illustrating the point.

But if you can figure out precisely what this litigation is about from this complaint, what the defendants are alleged to have done wrong, you are doing better than I am. It's unbelievably vague.

So are the patents. What is it that these patents do? What's the process or method? I mean, "Alerting Users to Items of Current Interest", a patent on a system for recommending things that might interest you based on your interest in something else? How's this for prior art? When I go to the local hamburger joint, they ask me if I want fries with my burger.

Publishers Weekly

My August Publishers Weekly column reports in on my experiment to see which of the major ebook stores would carry my books without DRM, and with a text disclaimer at the beginning that released readers from the crazy, abusive license agreements that most of these stores demand as a condition of purchase. Amazon, Barnes and Noble and Kobo were all happy to carry my books without DRM, and on terms that gave you the same rights you got when buying paper editions. Sony and Apple refused to carry my books without DRM -- even though my publisher and I both asked them to.

The upshot is that you can now buy electronic editions of my books in the Kindle, Nook and Kobo stores in DRM-free, EULA-free editions!

In May, I cornered Macmillan CEO John Sargent and CTO Fritz Foy at the Macmillan BEA party. As the publishers of my books with Tor, I asked them if they'd be willing to try offering my e-books to all the major online booksellers—Amazon's Kindle store, Apple's iPad store, Barnes & Noble's Nook store, Sony's e-book store, and Kobo—as DRM-free products with the following text inserted at the beginning of the file:

"If the seller of this electronic version has imposed contractual or technical restrictions on it such that you have difficulty reformatting or converting this book for use on another device or in another program, please visit http://craphound.com for alternate, open format versions, authorized by the copyright holder for this work, Cory Doctorow. While Cory Doctorow cannot release you from any contractual or other legal obligations to anyone else that you may have agreed to when purchasing this version, you have his blessing to do anything that is consistent with applicable copyright laws in your jurisdiction."

As I explained to John and Fritz, although all my books are available as downloads for free, I often hear from readers who want to buy them, either because it is a simple way to compensate me (I also maintain a public list of schools and libraries who've solicited copies of my books so that grateful e-book readers can purchase and send a print copy to one of them, thus repaying my favor and doing a good deed at the same time) or because they like the no-hassle option of tapping on their device to buy a book. I am more than happy to offer my otherwise free books for sale in any vendor's store, of course, but only if the vendors agree to carry them on terms I feel I can stand behind as an entrepreneur, as an artist, and as a moral actor.

Doctorow's First Law