CHAPTER 5 Chapter 5 Non-Open Source Licenses In the previous chapters, we have examined open source and free software licenses, all of which permit, to varying extents, substantial inroads on the protections other- wise available under copyright or patent law. In this chapter, by contrast, we exam- ine one variety of a classic proprietary license, as well as the Sun Community Source licenses and the Microsoft Shared Source Initiative. Classic Proprietary License The classic proprietary license needs relatively little explanation. The license does not need to distinguish, for example, between source and binary code: the source code is simply not made available. The license need not distinguish between distribution of derivative and original works: with one very narrow exception, neither is permitted. Proprietary licenses, like the one described below, may contain “open source” licensed software (under the more permissive licenses, like the MITand BSD Licenses), but the code they license may not be included in any open source project, unless the code is licensed under a parallel non-proprietary license that permits such use. The following license is the creation of the author. It licenses the hypothetical soft- ware of the Mildew Corporation, using terms found in virtually all proprietary licenses. 1. General. The software, documentation and any fonts accompanying this License whether on disk, in read only memory, on any other media or in any other form (col- lectively the “Software”) are licensed, not sold, to you by Mildew Computer, Inc. (“Mildew”) for use only under the terms of this License, and Mildew reserves all rights not expressly granted to you. The rights granted herein are limited to Mildew’s intel- lectual property rights in the Mildew Software and do not include any other patents or intellectual property rights. You own the media on which the Mildew Software is recorded but Mildew and/or Mildew’s licensor(s) retain ownership of the Software itself. 114 This is the Title of the Book, eMatter Edition Copyright © 2004 O’Reilly & Associates, Inc. All rights reserved. This provision provides that the software and associated documentation provided by Mildew are only licensed, not sold, to the consumer. This provision is substantially similar in effect to language used in the open source and free software licenses already described. The only rights granted are those specifically described in the license; all other rights are reserved. The sentence stating that Mildew does not license any property rights other than those that it owns is likely meaningless. By licensing the Software, Mildew is implic- itly representing that it has the authority to license all of its components, whether those components are its own work or not. It seems unlikely that a court would hold that Mildew was not responsible for damages to a consumer arising from infringe- ment if the Software turned out to infringe the intellectual property rights of a third party. After all, given the closed nature of the licensed software, consumers are not allowed to determine for themselves whether the software was infringing, even if they have the inclination or the resources to do so. The second section of the license makes clear the very strict limitations on the use of the software: not only may the end user not distribute the software, he cannot even install more than one copy of it at a time. 2. Permitted License Uses and Restrictions. This License allows you to install and use one (1) copy of the Software on a single device or computer at a time. This License does not allow the Software to exist on more than one such device or computer at a time, and you may not make the Software available over a network where it could be used by multiple devices or multiple computers at the same time. Because of these limitations, every user of the software, whether on a network or oth- erwise, must be individually licensed. This type of restriction is contained in almost every proprietary license and is universally enforced by the courts. The second para- graph continues with a narrow exception to this restriction. You may make one copy of the Software in machine-readable form for backup pur- poses only; provided that the backup copy must include all copyright or other propri- etary notices contained on the original. The next part of this sentence expressly bars any attempt to derive any of the utility of the code for use other than in the licensed Software. Except as and only to the extent expressly permitted in this License or by applicable law, you may not copy, decompile, reverse engineer, disassemble, attempt to derive the source code of, modify, or create derivative works of the Software or any part thereof. Any attempt to do so is a violation of the rights of Mildew and its licensors of the Software. If you breach this restriction, you may be subject to prosecution and damages. Breaching this provision would certainly terminate the license and would render the user liable for damages for further use. Although it is hard to see what damages, if any, Mildew would suffer from such unauthorized use beyond the sales price of another unit of the Software, such use could obviously lead to more substantial forms of infringement through the creation and distribution of derivative works. In Classic Proprietary License | 115 This is the Title of the Book, eMatter Edition Copyright © 2004 O’Reilly & Associates, Inc. All rights reserved. addition, reverse engineering or otherwise trying to derive the source code from soft- ware could violate U.S. copyright law or the Digital Millennium Copyright Act. Such source code certainly could not be used or distributed in any event, without violat- ing the civil and criminal laws of the United States. The final provision is a special disclaimer of liability, noting that the Software is not intended for use in high-risk applications. THE SOFTWARE IS NOT INTENDED FOR USE IN WHICH THE FAILURE OF THE SOFTWARE COULD LEAD TO DEATH, PERSONAL INJURY, OR SEVERE PHYSICAL OR ENVIRONMENTAL DAMAGE. The third section bars transfers or sales of the licensed software, except for the exception provided under law by the first-sale doctrine, which permits users to sell the rights acquired by license along with the physical medium, regardless of the terms under which the work was originally acquired. 3. Transfer. You may not rent, lease, lend or sublicense the Software. You may, how- ever, make a one-time permanent transfer of all of your license rights to the Software to another party, provided that: (a) the transfer must include all of the Software, including all its component parts, original media, printed materials and this License; (b) you do not retain any copies of the Software, full or partial, including copies stored on a computer or other storage device; and (c) the party receiving the Software reads and agrees to accept the terms and conditions of this License. This paragraph does not grant any rights to the licensee that he or she would not otherwise have by operation of law. Like most of the open source and free software licenses already examined, the license provides for automatic termination upon any breach of the license. 4. Termination. This License is effective until terminated. Your rights under this License will terminate automatically without notice from Mildew if you fail to comply with any term(s) of this License. Upon the termination of this License, you shall cease all use of the Mildew Software and destroy all copies, full or partial, of the Mildew Software. However, because the rights granted by the license are so limited in the first place, the effects of the termination are not likely to be severe, at least for programs pur- chased by individual consumers. As already noted, the measure of damages for con- tinuing use of the licensed program is not likely to be greater than the sales price of the Software. It should be noted, however, that U.S. copyright laws provide for potentially severe penalties for unlawful distribution of copyrighted material, includ- ing punitive damages. The fifth section provides a limited warranty for the medium on which the code of the Software is carried. Commercial software usually carries at least this minimal a warranty. 5. Limited Warranty on Media. Mildew warrants the media on which the Software is recorded and delivered by Mildew to be free from defects in materials and workman- ship under normal use for a period of ninety (90) days from the date of original retail 116 | Chapter 5: Non-Open Source Licenses This is the Title of the Book, eMatter Edition Copyright © 2004 O’Reilly & Associates, Inc. All rights reserved. purchase. Your exclusive remedy under this Section shall be, at Mildew’s option, either a refund of the purchase price of the product containing the Software or replace- ment of the Software which is returned to Mildew. THIS LIMITED WARRANTY AND ANY IMPLIED WARRANTIES ON THE MEDIA INCLUDING, BUT NOT LIMITED TO, THE IMPLIED WARRANTIES OF MERCHANTABILITY AND OF FITNESS FOR A PARTICULAR PURPOSE, ARE LIMITED IN DURATION TO NINETY (90) DAYS FROM THE DATE OF ORIGINAL RETAIL PURCHASE. SOME JURISDICTIONS DO NOT ALLOW LIMITATIONS ON HOW LONG AN IMPLIED WARRANTY LASTS, SO THE ABOVE LIMITATION MAY NOT APPLY TO YOU. THE LIMITED WARRANTY SET FORTH HEREIN IS THE ONLY WAR- RANTY MADE TO YOU AND IS PROVIDED IN LIEU OF ANY OTHER WARRAN- TIES (IF ANY) CREATED BY ANY DOCUMENTATION OR PACKAGING. THIS LIMITED WARRANTY GIVES YOU SPECIFIC LEGAL RIGHTS, AND YOU MAY ALSO HAVE OTHER RIGHTS WHICH VARY BY JURISDICTION. The following provisions restate the same limitations articulated by the second to last sentence of the fifth paragraph: Mildew disclaims all responsibility for any dam- ages caused by the Software, except to the extent it is prohibited from doing so by law.