The Software Freedom Conservancy Inc. has sued Vizio, Inc., a manufacturer of televisions with computing capabilities, in California state court. The SFC has accused Vizio of distributing software derived from code licensed under the General Public License v2, without complying with the copyleft obligations of that license.
Intriguingly, SFC is asserting a breach of contract claim, not a copyright infringement claim. SFC does not own the copyright to the Linux kernel, the open source software at issue in this case.
So how can SFC accuse Vizio of breaching a contract it never had with Vizio?
As a consumer of the Vizio product, SFC maintains that it is an intended third-party beneficiary of the GPL “contract” between the copyright owners of the Linux kernel, on the one hand, and those who take, copy and distribute code derived from it, on the other (ie Vizio). As an intended third party beneficiary, SFC is entitled to enforce the contract as if it is a direct party.
The remedy that SFC is seeking? Specific performance of the obligation to release the “full source code corresponding to the executable code resident on Vizio’s devices covered by the GPL agreements.”
Specific performance of the source code disclosure obligation is the holy grail of the FOSS movement, and now there’s a plausible path towards it.
That’s the sound of distant thunder.
Needless to say, if SFC is successful here, and consumers have standing to enforce copyleft open source licenses—and compel the production of source code of derivative works—the consequences will be non-trivial.
Described as the “fourth Apollo crewmember,” and credited with saving thousands of lives by improving common medical procedures like IV insertion, a checklist aims to solve one of two operational vulnerabilities humans have in tackling any decision, problem, or task: ignorance — lack of information, and ineptitude — failure to apply known information correctly or consistently. It’s not that we don’t know; it’s that we seem to lack the attention and focus to invest in marshalling what we do know, in a readily accessible form.
A simple checklist is a powerful legal knowledge management tool, and ideally suited for assisting counsel in drafting or negotiating standard categories of agreements.
Here are selected excerpts from a checklist for evaluating the other side’s confidentiality agreements (on the assumption that your client will disclose the client’s valuable and proprietary information):
Defined Purpose. If the NDA contains a defined “purpose” for the CI exchange, is the purpose used in order to restrict permitted use of CI, or is it used in order to limit the type of information that qualifies as CI (i.e., to qualify as CI, the info must be germane to the purpose)? If the latter, either pushback or ensure the client understands the risks of disclosing something that’s not deemed germane ….
Affiliates. If affiliates are not mentioned, consider including them. (Even if your client has none now, it may later.) If they are included, ensure language making the signatory responsible for affiliate breaches. In all cases, affiliates should be defined to mean those controlling, controlled by, or under common control ….
Special Restrictions. Consider including restrictions against (a) reverse engineering, (b) using CI to develop or improve any product or technology, (c) using CI to enhance a patent portfolio, or (d) using CI to assess whether patents are infringed. ….
Residuals. Consider pushing back on the clause or, failing that, adopt defensive measures to protect CI: (a) no intentional memorization; (b) no license to IP; (c) can use but not disclose; (d) limit to non-tangible information; (e) limit to technical information and not financial, business, marketing, or other information ….
Redline is a dynamic collaboration environment for a select cadre of lawyers worldwide, and a powerful knowledge management platform.Watch the trailers Lawyers with Mojo and Knowledge is Power, or go here to learn more.
The intended audience for this post is licensed and practicing lawyers, not laypersons seeking legal advice for their situation. If you are not a lawyer, hire one before using or relying on any information contained here. This post is: (1) informational only and not intended as advertising or as solicitation for legal services, (2) not intended to render legal advice to you, and (3) not a substitute for obtaining legal advice from a qualified attorney to assess your exact situation. The information here is subject to change and may not be applicable or correct in your jurisdiction. The views and opinions expressed here are Sean’s alone and do not necessarily represent the positions of Sean’s present or former employers, law firms, or clients.
Consider the following not uncommon scenario: in the payments section of the contract you are negotiating, overdue interest is charged at five percent. A higher rate is better for your client, and the client wants ten percent, so you redline accordingly. Client ultimately concedes and is willing to accept five. However, the draft from opposing counsel contains the following text:
Overdue interest is chargeable at the rate of five percent (10%).
The number in parentheses erroneously remains at 10. If anything, the discrepancy favors your client, since it leaves open the possibility to argue for application of the 10%.
Do you leave it alone and remain silent?
What if the applicable contractual rule of construction favors the text over the numbers, or the numbers over the text?
Does the answer change depending on the monetary significance of the ambiguity, or the impact on one or both of the parties?
Redline is a dynamic collaboration environment for a select cadre of lawyers worldwide, and a powerful knowledge management platform.Watch the trailer Lawyers with Mojo or click here to learn more.
Redline is powerful knowledge management. Private guilds enable solos and institutions alike to develop libraries of go-to clauses and forms—and their redlined variations derived from experience and collaboration.
Professional services vendors that develop custom software or technology to the specifications of their customers often face demands to indemnify and defend their customers from infringement claims of any and all intellectual property rights. “If I’m sued because of your deliverable,” the argument goes, “then you should step up and take responsibility for your failure to respect third party IP rights.”
This stance, though common, fails to appreciate the unique danger posed by “strict liability” IP rights for such vendors, in which liability for infringement attaches regardless of whether the accused infringer knew of the existence of the protected subject matter, and regardless of any intention or knowledge. Utility patents, design patents, trademarks, trade dress, and, in the EU, design registrations, represent strict liability IP rights.
On the other hand, copyrights, EU design rights, and trade secrets, where copying or misappropriation is an integral element of proof of infringement, are for this reason not strict liability IP rights. Buyers of custom deliverables are justified in holding their vendors to account if they failed to exhibit the necessary professionalism to prevent copyright infringement or trade secret theft. Plagiarists and thieves should have no place in product development.
Strict liability IP rights are quite different. Studies have demonstrated that it’s impossible to write software that doesn’t infringe a utility patent somewhere in the world. Design patents (which can apply to user interfaces) are particularly hazardous: they are granted automatically without review, and in the US, require disgorgement of all profits attributable to an infringing product or component.
Demanding that custom-development service vendors indemnify for strict liability rights infringements is problematic. The customer typically controls the specification, and the work is often iterative, driven by customer feedback that takes no account of potential infringements. Generally, there’s no time or budget, during the crunch of the project, for strict liability IPR clearance searches or freedom-to-operate opinions. The customer says, “please add this, and do it this way,” and the vendor complies, without asking questions about patents or trademarks. Such searches are not within the vendors’ core competency in any case.
In the custom development context, knowledge qualifiers connected to a non-infringement warranty, or a shared liability allocation, might be more appropriate with respect to strict liability IP rights. Strategies for drafting and negotiating relevant work product in this regard can be found here at Redline.
Redline is a dynamic collaboration environment for a select cadre of lawyers worldwide.Watch the trailer Lawyers with Mojo or click here to learn more.
The intended audience for this post is licensed and practicing lawyers, not laypersons seeking legal advice for their situation. If you are not a lawyer, hire one before using or relying on any information contained here. This post is: (1) informational only and not intended as advertising or as solicitation for legal services, (2) not intended to render legal advice to you, and (3) not a substitute for obtaining legal advice from a qualified attorney to assess your exact situation. The information here is subject to change and may not be applicable or correct in your jurisdiction. The views and opinions expressed here are Sean’s alone and do not necessarily represent the positions of Sean’s present or former employers, law firms, or clients.
