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2007 Prentice Hall, Business Law, sixth edition, Henry R. Cheeseman

Chapter 17: E-Contracts
and Licensing
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2007 Prentice Hall, Business Law, sixth edition, Henry R. Cheeseman
Uniform Computer Information
Transactions Act
A model state law that
provides uniform and
comprehensive rules for
contracts involving:
computer information
transactions
software licenses
information licenses

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2007 Prentice Hall, Business Law, sixth edition, Henry R. Cheeseman
Uniform Computer Information
Transactions Act (continued)
The UCITA covers the
following aspects of licensing
information rights:
Formation of a contract
Authenticating the record
Attribution procedure
Performance
Warranties
Breach of license agreements
Limitations of remedies

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2007 Prentice Hall, Business Law, sixth edition, Henry R. Cheeseman
The Internet
Collection of millions of
computers that provide a
network of electronic
connections.
Originally funded by the
Department of Defense.
National Science Foundation
continued system to facilitate
high-speed communications.
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2007 Prentice Hall, Business Law, sixth edition, Henry R. Cheeseman
The World Wide Web
Millions of computers
supporting HTTP.
Web sites and pages are
stored on servers operated
by Internet service providers.
Pages are viewed through
web browsers.
Extremely attractive to
commercial activities.
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2007 Prentice Hall, Business Law, sixth edition, Henry R. Cheeseman
Electronic Mail
E-mail is a widely used
application for
communication over the
Internet.
Electronic writing
Unique identifying address
Allows for instantaneous
communication around the
world
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2007 Prentice Hall, Business Law, sixth edition, Henry R. Cheeseman
Domain Name
Domain name a unique
name that identifies an
individuals or companys
Web site.
Domain names may be
registered by filing the
appropriate form with the
domain name registration
service and paying the
appropriate fee.

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2007 Prentice Hall, Business Law, sixth edition, Henry R. Cheeseman
Anticybersquatting Consumer
Protection Act
Aimed at cybersquatters who
register Internet domain
names of famous companies
and people and hold them
hostage by demanding
ransom payments from the
famous company or person.
The name must be famous.
The domain name was
registered in bad faith.

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2007 Prentice Hall, Business Law, sixth edition, Henry R. Cheeseman
E-Contracts
E-mail is sometimes the
method used to negotiate
and agree on contract terms
and to send and agree to
the final contract.
Assuming that all of the
elements to establish a
contract are present, an e-
mail contract is valid and
enforceable.

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2007 Prentice Hall, Business Law, sixth edition, Henry R. Cheeseman
E-Contracts Writing
Requirements
Electronic Signature in Global
and National Commerce Act
Electronic contracts meet the
writing requirements of the
Statute of Frauds.
Electronically signed contracts
cannot be denied effect
because they are in electronic
form and are stored and
delivered electronically.
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2007 Prentice Hall, Business Law, sixth edition, Henry R. Cheeseman
E-Signatures
Electronic Signature in Global
and National Commerce Act
Recognizes electronic
signatures
Same force and effect as pen-
inscribed signature on paper
Allows for verification of digital
signatures
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2007 Prentice Hall, Business Law, sixth edition, Henry R. Cheeseman
E-Licensing
The Uniform Computer
Information Transactions Act
(UCITA) governs the creation,
performance, and
enforcement of computer
information transactions.
Some states have adopted
UCITA.
Other states are applying
state law and equity
principals.

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2007 Prentice Hall, Business Law, sixth edition, Henry R. Cheeseman
Licensing
Intellectual property and
information rights are
valuable assets of individuals
and businesses.
License a contract that
transfers limited rights in
intellectual property and
informational rights.

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2007 Prentice Hall, Business Law, sixth edition, Henry R. Cheeseman
Licensing (continued)
Licensor The owner of
intellectual property or
informational rights who transfers
rights in the property or
information to the licensee.
Licensee The party who is
granted limited rights in or access
to intellectual property or
informational rights owned by the
licensor.

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2007 Prentice Hall, Business Law, sixth edition, Henry R. Cheeseman
Exclusive License
A license that grants the
licensee exclusive rights to
use informational rights for a
specified duration.

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2007 Prentice Hall, Business Law, sixth edition, Henry R. Cheeseman
Licensing Agreement
Licensor
Licensee
License
transfer of rights in
intellectual property
or information)

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2007 Prentice Hall, Business Law, sixth edition, Henry R. Cheeseman
Licensing Agreement (continued)
Detailed and
comprehensive written
agreement between the
licensor and licensee.
It sets forth the express terms
of their agreement.

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Breach of Licensing Agreements
The parties to a contract for
the licensing of information
owe a duty to perform the
obligations stated in the
contract.
If a party fails to perform as
required, there is a breach of
the contract.

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2007 Prentice Hall, Business Law, sixth edition, Henry R. Cheeseman
Breach of Licensing Agreements
(continued)
Licensees refusal of defective tender
Licensees revocation of acceptance
Adequate assurance of performance

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2007 Prentice Hall, Business Law, sixth edition, Henry R. Cheeseman
Remedies
The UCITA provides various
remedies that injured parties
can obtain against
breaching parties.
Cancellation
Licensors damages
Licensors right to cure
Licensees damages
Specific performance

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2007 Prentice Hall, Business Law, sixth edition, Henry R. Cheeseman
Limitations of Remedies
The UCITA provides that the
parties to an agreement may
limit the remedies available
for breach of the contract.
Limitation of remedies in
licenses subject to the UCITA
are enforceable unless they
are unconscionable.