The GPL is the backbone of the free software movement, but is it strong enough to stand a test in the courts?
You get a call one afternoon from a mysterious stranger with a job proposition for you. “Salary, options, the whole nine yards,” he says, and convinces you to meet him at a local restaurant. “OK,” you think, “it’s Silicon Valley in the ’90s. Let’s hear what he’s got to say.”
A few hours later you’re sitting across from Palo Alto’s version of corporate America: A young guy in brown general-issue Banana Republic-ware, with a red bowtie — a token of his individuality. He stops the conversation every ten minutes to answer his cell phone and jot a few notes into his PalmPilot.
“Call me Bates, Gilbert Bates,” he says. “My company’s got its first round of seed capital and we’re adding a few more players to our team. I know you won’t want to turn this down. We’ve got the hottest product of 1999, and the Street loves us.” He leans forward conspiratorially: “Linux!”
Bates claims to have developed an emulator that will make Linux compatible with both Wintel and the Mac. And on top of that, he’s got a graphical user interface that puts Microsoft to shame. He’s almost through incorporating them into a new version of Linux and expects to sell millions of copies. “It’s the new standard OS,” he says. “We are going to put Microsoft out of business. And of course,” he whispers, “it’s proprietary.”
“Proprietary? Impossible!” you think. “That’s a violation of the GNU General Public License (GPL), which is the whole foundation of Linux!” But when you explain your objection, he simply laughs. “Our lawyers have taken a look at the GPL. It’s not enforceable. We are going to package our version of Linux with our own proprietary license — no source code included, of course.”
A thousand questions race though your head, and suddenly you almost wish you had taken Dad’s advice and gone to law school (almost, but not quite). You wonder: What happens if a judge decides that the license terms in the GPL are unenforceable? Are open source licenses so different from ordinary software licenses that a court won’t uphold them? And what will be the effect of a new act that you’ve heard is going to change the way that computer licenses operate, the Uniform Computer Information Transactions Act (UCITA)? Will it help or hurt the Linux community? Will it help or hurt the GPL?
Enforceable at Any Speed?
Bates pulls out a thick sheaf of documents. “My lawyers threw this together,” he says. “They say the GPL will never stick.” He points to a paragraph entitled “The General Enforceability of Software Licenses.”
“An ordinary software license is negotiated between two parties who each know what they’re getting into,” explains Bates. “The reason it’s enforceable is that each side has had the benefit of looking at the terms of the deal and has given it careful consideration before signing. The law wants to let people strike bargains that they want to make, for better or for worse, just so long as they make their decisions knowingly.” He looks up from the document for a moment. “That’s why people are able to create — and the courts enforce — license agreements for all sorts of intellectual property like copyrights, trademarks, and patents.”
“But courts don’t see a mass-market license in the same way as a negotiated agreement. Mass-market licenses such as the GPL (or the license that comes with Microsoft Word, for that matter) are software licenses that are offered on the same terms to all customers and not negotiated individually. If a user purchases packaged software at a store and doesn’t see the document that designates itself a ‘license’ until after she opens the package, a judge won’t have a ready answer as to whether there’s an enforceable ‘license’ or not. The decisions are all over the place.”
He reads again from the document: “Some judges have found mass-market licenses unenforceable because users have no way to meaningfully consent to the terms of the license. Still other courts have found mass-market licenses unenforceable because of the coercive nature of these licenses, which are typically presented to users on a take-it-or-leave-it basis. Many courts have regarded mass market licenses as ineffective, characterizing the transaction as sale of a copy of the software, rather than as a license.”
He looks up at you. “So that’s strike one against the GPL. It’s a mass-market license. Even though some courts have found that installing software may act as consent to the terms of a mass-market license, lots of other courts disagree. And that means that lots of judges would invalidate the GPL just because it’s not individually negotiated.”
A License Less Ordinary
“So what do you say?” asks Bates. “I could use a guy like you. How would you like to be the first kid on your block with options in Linux? Not support and installation, but Linux itself. Are you in?”
You kick back in your chair and think. “Proprietary Linux? It would be like minting money, if he could really do it. But it goes against everything that open source stands for.” And then it comes to you.
“Wait a minute,” you say. “If your argument is that mass-market licenses aren’t worth the paper they’re written on, then you’ve got a problem. Aren’t you going to depend on mass-market licenses to license your own operating system? If they’re no good, your plan doesn’t work.”
Bates frowns and narrows his eyes as he pushes himself away from the table. “You open source guys are all the same,” he grumbles. “Looking a gift horse in the mouth…” He shuts his eyes for a long moment, then opens them and takes another sip of wine. He savors it for a moment before swallowing, then smiles.
“But even if you’re right, it doesn’t matter. There are other reasons why my proprietary license will work while your open source license will not.” He pulls out the legal brief again and reads from it. “The GNU license differs from a proprietary software license in two important ways: First, there is no payment made for the open source software that the license comes with, and second, it is often unclear who has the right to enforce the license.”
Bates looks up from the brief and speaks to you directly. “My lawyers call the first issue a problem of ‘consideration’ and the second a problem of ‘standing.’”
Bates continues. “Under the law of contracts, the courts look to see whether there has been a payment of some sort before determining whether a contract is enforceable. The payment doesn’t have to be monetary, but it does have to be present in some form for a contract to be enforced. Lawyers call this payment ‘consideration’ and require consideration of some sort in every contract.”
Bates pulls out his cell phone and places it on the table. Then he pulls out a piece of paper, scribbles something on it, and gives it to you. You read: “I, Gilbert Bates, hereby contract and agree to give you my cell phone tomorrow morning,” below which it’s signed and dated.
“The ‘contract’ I just gave you,” said Bates, “is not enforceable. There’s no consideration for the cell phone. So if I did decide to give you the phone tomorrow, it would simply be a gift. But the courts will never force someone to give a gift — even one they’ve promised to give.” He crumples the paper up and holds it over the candle flame, where it starts to blacken and smolder. “This contract is no good.” He looks into your eyes. “And neither is the GPL.”
“The problem is that people don’t pay for Linux. A user may pay for the CD-ROM on which the code is burned, or for a service contract for technical support, but no user pays for the Linux code itself. They can’t under the terms of the Open Source license. So where is the consideration for the software? There is none, which means that the GPL is not enforceable.” Again, he smiles. “There’s no way around that!”
You think about it for a moment. “You know, there may be no money changing hands, but you said yourself that consideration doesn’t have to be purely financial. What if the consideration is something else?” Bates looks at you skeptically, and you try to think of something intelligent to say. “Although no money changes hands in exchange for Linux, users give up important things when they agree to the terms of the GPL. For example, they agree that
if they modify the source code, they will make it freely available to others.” You pick up the cell phone and flip it open, and Bates starts to look a little uncomfortable. “Maybe that’s ‘consideration,’” you say as you slide the phone into your pocket.
“I’m no lawyer, but don’t people agree to exchange services all the time? No money changes hands, but the courts enforce those contracts. No one asks whether the services exchanged are important enough to be consideration. How is this any different?” You pick up the crumpled piece of paper and smooth it out. It isn’t burned too badly and Bates’ writing is still legible. “So if a judge recognizes the value of the Linux community’s commitment to contribute modified code back to the community, maybe there is consideration after all.”
“There’s another problem,” says Bates. He doesn’t look so happy now. “Standing. Before a lawsuit can proceed, it must be shown that the person bringing suit has a legal right to do so. Having this right is known as having ‘standing’ to sue. But not everyone has standing.” Bates opens the legal brief again and quotes from it. “Trees don’t have standing to sue, even if they’re being illegally cut. A lawsuit can’t be brought in the name of a dog, even if the dog is being beaten by its owner. In each case, a group or member of a group such as the Sierra Club or the Humane
Society would have to sue, arguing that they, and not the tree or dog, would be injured if the
lawsuit is not allowed to proceed.”
Bates looks up from the brief. He speaks more forcefully now. “And people don’t always have the right to sue, either. A man may be upset when someone insults — or even attacks — his girlfriend. But this doesn’t give him the right to sue. He hasn’t been injured personally. Only his girlfriend has. And no matter how strongly he feels about it, unless he’s the one who’s actually been injured, the courts will hold that he can’t sue to enforce a right that belongs to his girlfriend. Only she can do that. Otherwise, we would live in a world in which anyone could sue at any time for anything that they don’t like, even if they haven’t been personally affected by it. Just think how clogged the courts would be then! We need to limit the number of suits that may be brought, so that standing requirements are strictly enforced.”
Bates pulls out a cigar and lights it. “So the question is, who has standing to enforce an open source license? Or, to put it another way, who is hurt when the terms of the GPL are ignored?” He puffs on the cigar, then takes a long draw and holds it. When he exhales, he covers you with smoke, and he grins widely. “Nobody,” he says. “Nobody is hurt, so nobody can sue.”
You start to cough, but stop yourself in order not to give him the satisfaction. “Just a minute,” you say. “That’s not true. Lots of people are hurt when the GPL is ignored.” You try to think fast. “If Red Hat supplied the code under the GPL, then Red Hat has a right to expect that anything you do with the code will be freely available for them to use in the future. They’ll have standing.”
“Maybe so,” Bates snaps. “But what if it isn’t clear whose distribution of Linux is being used? There’s no way to tell one distribution from another. Even if Red Hat has standing to sue us, they won’t know whether we used their distribution, so they’ll never do it! Even if you’re right, it doesn’t matter. We’re certainly not telling people whose distribution we’re using!” Bates blows smoke again, this time directly into your face, and you sneeze. “So I’m not worried about your argument.”
You sneeze again, and this time you catch Bates right in the eye. “Oooh,” you think, as he doubles over, his hands searching for his napkin. “Well, just wait a minute,” you say, doing your best to ignore his situation. “Even if you’re right, that doesn’t mean that nobody can sue. Doesn’t it mean the opposite — that everybody can sue, because there’s a chance that anyone might have supplied the distribution? Certainly if all the distributors formed an organization like the Sierra Club or the Humane Society, then the organization could sue on behalf of the whole community of Linux distributors, because one of them would have been the supplier. Right?”
You keep thinking out loud. “And aren’t there people who can enforce a contract even though they didn’t sign it themselves? For example, if you agree that instead of paying me a signing bonus, you’ll buy a necklace for my girlfriend and mail it to her, and we sign a contract that says so, then if you don’t buy the necklace my girlfriend can sue you. She’s the one with standing, not me. After all, the necklace was for her, not for me. She can sue even though she never signed a contract with you herself and may never know that the necklace is owed to her until I tell her.” You search your memory for the right term. “I think they call that being a third-party beneficiary of a contract.”
Bates wipes his eyes rapidly with his napkin as you continue. “Couldn’t a court decide that members of the Linux community are ‘third-party beneficiaries’ of the GPL? Haven’t members of the Linux community contributed to the Linux source code with the expectation that they will have the right to receive future versions of Linux free from proprietary restrictions? And doesn’t that entitle them to sue if you misappropriate their work, even though they haven’t directly entered into a deal with you?” The more you think about it, the more you like this argument. “The GPL clearly intends for developers to benefit from the development of Linux. So a violation of the GPL would be a violation of developers’ rights as third-party beneficiaries. Wouldn’t it?” you ask.
What if the License is not Enforceable?
Now you’re on a roll. “Suppose you are right, and a court finds that the GPL is not enforceable,” you ask. “You don’t really win in that case, do you? I mean, the only document that gives you permission to use and modify Linux in the first place is the GPL, so if it is declared invalid, then your use of Linux is invalid as well. Isn’t it? Since the license is the only permission that you have to use the copyrighted source code, if the license is not enforceable, copyright law will prevent you from making — much less selling — a modified version of the code. If you went ahead and did it anyway, your unlicensed use of the source code would open the door for a copyright-infringement suit from anyone who had contributed copyrighted material to the Linux kernel!”
Bates is not happy. He looks for an ashtray and, seeing none, snuffs his cigar in the small flowerpot on the table. You smell the stench of burning leaves.
“That’s only true if the entire GPL is found to be invalid,” grumbles Bates. “And that would never happen. If a judge felt that part of the GPL was problematic, he would remove the troublesome terms and leave the rest of the license in place. The most likely outcome is that the part of the GPL that requires developers to reveal their source code to all future users would fail for lack of consideration, as I said.”
He leans back in his chair and tries to appear confident. You notice a small black line of ash creeping slowly up the stem of a carnation in the centerpiece. A slow burn must be happening in the stem, you think, like a fuse or a cigarette. But Bates is too distracted to notice.
“Not at all,” you answer, trying not to look at the flower. “I don’t think that’s what would happen. The most important term of the GPL is the requirement that modified versions of the Linux source code will be made freely available. This is essential to the open source movement and has led to all the success and innovation that we’ve seen in open source software so far. It’s the reason why private companies are trying to emulate open source without giving up more than they have to.”
You lean back in your chair, and Bates leans forward in his in order to hear you.
“Now, I’m no lawyer,” you say, “but everything I’ve read about the law leads back to the idea that courts have a duty to promote competition and innovation. That’s the whole point of copyright law, and it seems to be what courts are aiming for whenever they decide an antitrust case as well: How do we maintain a fair and open marketplace in which competition and innovation are not stifled by the power of big companies that prefer the status quo?”
You try to remember what you’ve read about the Microsoft case. “They call it a question of public policy. So, if a court were to decide what terms to invalidate in the GPL, it certainly wouldn’t start with the one that the open source movement — and so much innovation — is based on. That would contradict the aims of public policy. I have to believe that even if other terms within the GPL were knocked out, this one would have a good chance of surviving.”
The carnation suddenly bursts into flame, singeing Bates’ nose. He shouts, more in surprise than pain, as he stumbles back. A waiter rushes over and grasps Bates by the arm. With a firm hand, he guides him toward the rest room.
UCITA: The Future’s Uncertain and the End is Near.
You feel a vibration in your pocket. It’s Bates’ phone. You flip the Startac open. “Yes?”
“Mr. Bates?” asks a man’s voice. “I’m sorry to bother you, sir, but I’m supposed to drop off your new Ferrari today. I was wondering where you would like it delivered? Your home or your office?”
“Hmmm…” you say, then make a snap decision. “I’m eating out at the moment. Why not bring it to me at the restaurant?” You give him the address and hang up just as Bates returns to the table and sits, dabbing his eyes with a wet napkin.
By the time Bates faces you, you’ve gathered your thoughts. “This argument is moot in any case,” you say. “They’re drafting a new law to take care of the problems you’ve been talking about. It’s called The Uniform Computer Information Transactions Act or UCITA, and it’s going to make the GPL enforceable.” You remember hearing about it from friends and try to pull their words from your memory. “Under UCITA, shrink-wrap and click-wrap licenses — all forms of mass-market licenses — are going to be completely enforceable,” you tell him.
Bates nods his head. “That’s right,” he says, “but that’s all the more reason why you should come where the money is and forget open source.” He raises his arms to the sky.
“I pray that they pass UCITA in its present form, but it’s not at all clear that they will,” he says. “If they do, proprietary software will benefit more than open source simply because proprietary software is far more likely to be licensed under restrictive terms, which UCITA will allow companies to enforce. I’ll be able to hold people to whatever agreement I dictate, simply by convincing them to click a little ‘I agree’ button or load a software program. And it will all be perfectly legal!”
“In fact, if UCITA passes,” he says, “I won’t need to worry about Linux at all because open source will become just another footnote in the history books. UCITA means the end of open source.” He pulls out another cigar and lights it.
“UCITA will allow me — and all the other software companies — to forbid reverse engineering of our products for interoperability purposes. And we will, of course. But without the ability to interoperate with proprietary software, open source software’s growth will slow tremendously. Would you use a Linux product that didn’t work with your other software? Forget it! Linux will roll over and die.”
You pluck the lit cigar from his hand. “No. That won’t happen at all,” you tell him. “In fact, the opposite is true. Open source users will refuse to buy a proprietary product with terms like that in its license. We’ll fight the marginalization of open source tooth and nail.”
You notice a young man walking into the restaurant. He speaks briefly to a waiter, who motions towards your table. “Time to go,” you think.
You rise and walk toward the man. “For Bates?” you whisper. He nods and hands you a key just as Bates, after throwing a wad of cash on the table, catches up to you.
“In fact,” you tell him, strolling toward the parking lot without breaking stride, “that’s the problem with your whole scheme. Whatever the benefits of ignoring the GPL, if you do so you’ll anger the entire Linux community and they’ll refuse to buy your product.”
You notice a new Ferrari in the parking lot, beautiful and bright red, and you try the key in the door. It fits perfectly and you slide in and take the roof down.
“They’ll fight you in the courts, and if that doesn’t work they’ll fight you in the market. A boycott of software that violates the GPL will work, if we can all stick to it.”
You start the car and rev the motor. You’ve never started a Ferrari before, but it feels alright. The sleek Italian automobile purrs like a kitten. You look Bates in the eye. “Your scheme to sell us your product will never work, Bates,” you say, “and I would never join your company — I would not have joined even if I thought the stock would go through the roof. Linux isn’t meant to be proprietary.”
You shut the door and head for the exit, calling out to Bates just before you are out of earshot. “Don’t you know, Bates, the best things in life are free?”
And you hit the open road.
Software publishers are anxiously awaiting the arrival of a new law of software licensing that will end the persistent questions about software-license enforceability. Once known as proposed Article 2B of the Uniform Commercial Code, this model law is known as the Uniform Computer Information Transactions Act (UCITA). It is called a uniform law, since its proponents intend for the law to be enacted in each state in the union, and to be enforceable throughout the entire country.
If passed, UCITA will make software-license agreements enforceable throughout the United States. Although it is envisioned as a law of software licensing, it proposes to regulate all computer information transactions, including some transactions that have traditionally been considered sales under the “first-sale” doctrine. The Act’s own words give it an extremely broad authority, declaring that it covers any agreement “a primary purpose of which is to require a party to create, modify, transfer, or license computer information or informational rights in computer information.” This broad definition encompasses the Linux license and would regulate how the license can be accepted, what terms are acceptable, and how the license would be interpreted.
The good news is that under UCITA, courts would most likely enforce the GPL. According to Robert Gomulkiewicz, a licensing official at Microsoft, UCITA will ultimately benefit open source developers generally, since it will ratify shrink-wrap and click-wrap software licenses and make it easier for a software developer to distribute its product without warranties.
But open source developers should take heed. While a rising tide may lift all boats, UCITA’s tide will lift some boats higher than others. Proprietary software will benefit more than open source software because proprietary software is likely to be licensed under more restrictive terms, which UCITA will enforce.
Under UCITA, as currently drafted, it is fair to say that virtually all restrictions on
the use of software or other computer information are
presumed to be lawful. This presumption in favor of restrictive terms may embolden proprietary software developers to distribute their products with terms that override rights that users take for granted at present. If it becomes easier for proprietary software developers to enforce restrictive license terms, this might ultimately be detrimental to the open source software movement.
To give one example, restrictive terms of a proprietary license might forbid any reverse engineering of software for interoperability or other purposes. Without the ability to interoperate with proprietary software, open source software’s growth will be limited. In addition, restrictive license terms may contribute to consumer lock-in to particular proprietary technology. A proprietary vendor of computer information will also be able to modify terms of its license — even months after the sale — by making the new terms available in a publicly accessible manner (e.g. a Web site where license terms are posted).
UCITA has not yet been enacted in any state, but it will likely be considered by various states in the next year and may become law in some. Given the limited benefits provided by the law and the large number of problems that pervade the act, most Linux developers may gain little and lose a lot if UCITA comes to their home state. The potential problems with UCITA have inspired the Free Software Foundation to support a campaign to defeat the model law. (See http://commons.somewhere.com/rre/1999/RRE.campaign.against.abu.html.) — Kurt Opsahl
Adam Goodman is founder and publisher of Linux Magazine and can be reached at firstname.lastname@example.org. Pete Comas is a Senior Editor for Linux Magazine and can be reached at pete @linux-mag.com.