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Liability of Computer Security Software Providers in the European Union TILBURG UNIVERSITY Liability of Computer Security Software Providers in the European Union Master Thesis Ivana Lackova ANR: 591 867 June, 21st 2013 Supervisor: C.M.K.C. Cuijpers Table of contents Chapter 1 - Introduction ............................................................................................................. 2 Chapter 2 - The situation in the USA ......................................................................................... 4 2.1 Short excurse to legislative history of §230 CDA and the related case law .................... 4 2.2 Zango v. Kaspersky .......................................................................................................... 6 2.2.1 Background of the case ............................................................................................. 6 2.2.2 Drawbacks of Zango v. Kaspersky ........................................................................... 9 2.3 Zango v. PC Tools .......................................................................................................... 10 2.4 The end user and immunity of CSSPs according to §230 CDA. ................................... 11 Chapter 3 - CSSP’s outputs and product liability in the EU .................................................... 13 3.1 Nature of CSSPs outputs ................................................................................................ 14 3.1.1 Software in general - mere product or service? ....................................................... 16 3.1.2 Are updates part of the software (product) or are they an additional service from the software provider? ............................................................................................................ 19 3.2 CSSPs liability to consumers on the internal market ..................................................... 20 3.2.1 Liability for defective software ............................................................................... 21 3.2.2 Liability for unsafe software ................................................................................... 24 Chapter 4 - CSSP’s liability according to the eCommerce Directive ...................................... 26 4.1 Can a CSSP classify as an information society service provider in the EU? ................. 27 4.2 If CSSPs qualify as information society service providers, will the exemptions from liability, also known as the “safe heaven” apply to them? ................................................... 31 4.3 Conclusion ...................................................................................................................... 33 Chapter 5 - CSSP’s liability in national legislation - The Slovak Republic and The Czech Republic ................................................................................................................................... 34 5.1 General tort law .............................................................................................................. 35 5.1.1 The Slovak Republic and The Czech Republic until 31.12.2013 ........................... 36 5.1.2 The Czech Republic and the New Civil Code ......................................................... 38 5.2 Goodwill protection ........................................................................................................ 40 5.2.1The Slovak Republic and The Czech Republic until 31.12.2013 ............................ 40 5.2.2 The Czech republic and the New Civil Code .......................................................... 42 Chapter 6 - Conclusion ............................................................................................................. 43 Bibliography ............................................................................................................................. 45 1 Chapter 1 - Introduction Computer security software providers (hereinafter also as “CSSP(s)”) play a significant role in the cyber world by developing software to protect users from harmful content on the Internet, from causing harm to files by viruses, generally called malware. Malware for the purpose of this thesis can be defined as programming (code, scripts, active content, and other software) designed to disrupt or deny operation, gather information that leads to loss of privacy or exploitation, gain unauthorized access to system resources, and other abusive behavior.1 The outputs of CSSPs, mainly called security software packs, usually consist of various forms of firewall, anti-spam, anti-spyware and anti-virus software.2 Therefore, the role of the CSSPs is not only to monitor and detect, but also to filter and possibly disallow malicious content. While performing these actions a mismatch can occur and the file or content detected as offensive may not be harmful. The owner of the software, whose file was mistakenly detected as malware, can suffer damage, because the end-user cannot access their website or cannot use their program. The role of end user in this situation is also important. The user can claim the goods (software, service) that were blocked and ask for a refund. However, there is another aspect - the scope of the control over the software that the CSSP provided to the user by program settings. This aspect cannot be overlooked either, because the CSSP should not be liable when the user adjusted his computer program settings and had control over the content. This thesis will focus on the question, whether there is any liability of CSSPs, when their software mistakenly identifies a file or service as malware in the European Union (hereinafter also as “EU”) and removes the file or service, or blocks access to it. Nowadays, it is relatively clear in the United States of America (hereinafter also as “USA”) what CSSPs can expect, when their detection software (by mistake or by having too strict settings) filters and removes, or denies access to the content of another software provider or interactive online service provider. 1 Official website of the Department of Homeland Security. (n.d.). An Undirected Attack Against Critical Infrastructure. Retrieved March 3, 2013, from www.us-cert.gov/control_systems/pdf/undirected_attack0905.pdf 2 e.g. ESET Smart security available at: “Internet Security With Firewall, Anti-Theft, Parental Control & more - ESET Smart Security." ESET UK - Antivirus Software, Internet Security & Virus Protection. Retrieved March 3, 2013, from http://www.eset.co.uk/Home/Smart-Security 2 Therefore, in order to provide guidelines for the EU, the situation in the USA will be described in Chapter 2 of the thesis. A key decision has been given in the case Zango v. Kaspersky3 which affirmed immunity for CSSPs according to §230(c)(B) Communication Decency Act of 1996, 47 U.S.C. (hereinafter also as “CDA”). The chapter briefly describes the situation before Zango v. Kaspersky and the case law related to CSSPs. Although Zango v. Kaspersky is the only known case of CSSP liability in the United States Court of Appeals, there are also some interesting claims and decisions on the District court level, which are included in the thesis. The last part of Chapter 2 will be focused on the end user, because CSSP´s software could also be capable of causing harm. The question, whether relevant provisions of CDA would have been applicable, if the harm was caused to the user, will be answered as well. In Chapter 3, the focus will be on product liability of CSSPs. The research will be performed on the EU level and case law in the United Kingdom and Germany. As these countries have developed legal systems there is a higher probability that there were claims, where CSSPs were sued for damages in relation to filtering of legitimate material. Chapter 3 will also try to answer the question, whether CSSP’s outputs are definitely products or if there is space to consider their actions as a service. The question whether false positive detection can be considered as a defect of the product will be answered as well. Consequently in Chapter 4 the definition of Computer security software providers according to European legislation, using existing Directives and case law will be provided. The basis for this chapter will be an answer to the question, whether CSSPs are information society service providers. The importance of this chapter is to identify whether or not CSSPs fall within the definition of information society service providers and whether or not there is immunity from liability. Due to author’s interest in the topic and deeper knowledge of the Slovak and Czech legal system, the legislations of those countries will be involved in the thesis. The forth-coming recodification of the Czech Civil Code including the reform of the civil liability regime, which will come into force on January, 1st 20144, could prove very interesting. The general tort law as well as goodwill protection (alternatives to the USA legal institutes, which were used in the claims in the USA) according to Czech and Slovak legislation applicable for CSSPs will be discussed in Chapter 5. 3 Zango v. Kaspersky Lab, Inc., 2009 WL 1796746 (9th Cir. June 25, 2009) 4 Uvodni stranka - Obcansky zakonik. Uvodni stranka - Obcansky zakonik. Retrieved June 3, 2013, from http://obcanskyzakonik.justice.cz/cz/uvodni-stranka.html 3 The liability regime for CSSPs in case of blocking content as well as mismatches is not very clear in the EU. There is no exact legislation in the EU as opposed to the USA. Until now, there has not been any ECJ decision concerning CSSPs liability so far. This research
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