Information Technology Law

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LLOYD I.J., Information Technology Law, Oxford/New York, Oxford University Press, 2008

Type Book
Topics Competition, Contract, Data Protection, Intellectual Property


Pp. 11-12. Data surveillance: “Every action of an individual reveals something about the person. […] This may occur directly, for example, in filling out a form, or indirectly, as when goods or services are purchased. The essence of data surveillance lies in the collection and retention of these items of information”.

P. 15. “As well as being a commodity in its own right, data is the motor and fuel which drives the information society”.

P. 360 ss. History of the development of software copyright. Why end-user software licences have been created. Software piracy.

[[CC4::P. 364. “The essence of copyright is that it prohibits the copying of a work without the consent of the copyright owner. In the case of most works, this does not impinge upon a third party's normal use of the work. The purchaser of a book can read it without requiring to make any form of copy. […] Software […] operates in a different manner. Any form of use requires that the contents of the work be copied from a storage location to been processed within the equipment. Normal use requires copying, a fact which creates complications, not just in the filed of copyright but also – through the widespread use of software licences – in the area of liability”. At p. 362, LLOYD said: “Also involving direct reproduction is the act of using software. Every time a program is used, a copy of its contents is required to be taken from its storage location on the computer to the machine's active processing memory. This […] has led in part to the emergence of software licences”.]]

[[CC4::P. 365- 367. A use right for software? In 1991, the Software Directive has been introduced. Its art. 4 has established an exclusive and extended reproduction right fro the copyright owner, but its art. 5(1) has introduced an exception, better explained in Recitals 17 and 18 (today Recital 13). LLOYD says (p. 367) that this exception has made end-user licences superfluous in some cases, because art. 5(1) has introduced a use right; but in other cases, a licence is still necessary, in his opinion, because “[t]he telecommunication facilities provided by such a development means that one copy of a program may be used by a considerable number of different people. Depending upon the nature of the program and the network, use may be either simultaneous or successive. A further difficulty may arise in the situation where a user has two computers, typically, one at home and one at work. In this case, the user may well wish to use the same software […] on both computers”. If we consider (see SMITH) that, in case of sale, licences help only in determining the intended purpose, but are not contractually binding in those aspects covered by art. 5(1), this is not true: licences are not necessary, because – if they are absent – the intended purpose will be objectively determined (see SMITH).]]

[[CC1::P. 367. Error correction. Art. 5(1) of the Software Directive states that the lawful acquirer of a copy of a software can without authorization make those actions which are necessary for error correction (and – no matter if he is a buyer or a licensee – clauses that oppose to it aren't valid: Recital 18). RICOLFI (I Contratti dell'Informatica, pp. 8-9) deals with the Italian norm (art. 64-ter.1 l.d.a.), which however reproduces the European provision: RICOLFI states that error correction (patches) is always possible, but the addition of new functionalities requires the authorization. In my opinion, for what concerns the intermediate category of updates, the possibility of making it without authorization depends on the fact that they are necessary to continue to use the copy of the software in accordance with its intended purpose. The provision about error correction seems to allow also the correction by a third party on behalf of the lawful acquirer (indeed, Report from the Commission to the Council, the European Parliament and the Economic and Social Committee on the implementation and effects of Directive 91/250/EEC on the legal protection computer programs deals with the fact that “lawful acquirer” of art. 5(1)may also be a person acting for the purchaser or hirer).]]

P. 373. Distinction between operating systems and application programs. Operating systems are computer programs that contain “the basic instructions necessary for a computer to operate”. Application programs are computer programs which “work with the operating system to perform specific applications and must respect its particular requirements”.

P. 444 ss. Competition and intellectual property issues. “The promotion of free and fair competition is a key objective of the EU” (p. 444), and the provisions of intellectual property law show a considerable degree of tension with the provisions of competition law. The CJEU has assessed whether the application of competition law principles might overcome in some cases copyright law. “[T]he Treaty of Rome […] established the EU do not impact upon the existence of intellectual property rights” (p. 444), but the CJEU has held that the provisions of articles 101 (anti-competitive agreements between undertakings) and 102 (conduct abusive of dominant position) TFEU “may restrict the extent to which they can be exercised” (p. 444). Particularly relevant in this domain is the Microsoft litigation (Case T-201/04): the final decision of the Court of First Instance came in 2007. It held that “[i]n respect of the exceptional situations in which the requirements of competition law might prevail over the exercise of intellectual property rights, […] three factors had to be present: in the first place, the refusal relates to a product or service indispensable to the exercise of a particular activity on a neighbouring market; in the second place, the refusal is of such a kind as to exclude any effective competition on that neighbouring market; in the third place, the refusal prevents the appearance of a new product for which there is potential consumer demand” (p. 450). Obviously, the dominant position of Microsoft has been fundamental for its defeat.

Pp. 510-511. Liability for defective products: in case of contractual liability, we can apply the UCP Directive and the Directive on Sale of Consumer Goods; in case of non-contractual liability, we can apply the Directive on Liability for Defective Products.

P. 513. Forms of software: standard software packages (identical copies will be supplied to users, often via a substantial distribution chain); customised software (the supplier modifies existing software, better to suit the requirements of a particular customer); bespoke or made-to-measure software (the supplier agrees to design and develop software to suit the needs of a particular customer). When we have standard software packages, “the producer attempts to introduce a set of terms and conditions through the device of a licence. [T]he validity of software licences is open to challenge on a number of grounds” (p. 513).

P. 514 ss. The legal status of software contracts in the UK.

P. 536. Enforceability of shrink-wrap licences. N.B.: “From a licensing perspective, use of the Internet may simplify the supplier's task of establishing customer awareness of and agreement to the licence terms. It is a simple matter to cause either a set of the terms or at least reference to their existence to be displayed, with the customer required to 'click' on a button marked 'I accept' before the transaction can proceed”. Therefore, with the commercialization of software through the Internet, it is less in doubt the validity of software licences. The problem raises again, however, when we deal with browse-wrap licences (see HELBERGER).

P. 545. Example of a contractual clause excluding liability (the software is provided 'as is'...).