Re: [unrev-II] A Cusp: License issues for released code & Legal Notice

From: Paul Fernhout (pdfernhout@kurtz-fernhout.com)
Date: Tue May 16 2000 - 21:06:19 PDT

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    Eugene Eric Kim wrote:
    >
    > On Tue, 16 May 2000, Paul Fernhout wrote:
    >
    > > Based on previous discussions with my IP lawyer, indemnification as
    > > broadly construed is in effect a warranty to ensure the customer for the
    > > Intellectual Property can use the IP and will not have any additional
    > > legal costs associated with that use. What you say is correct, BUT you
    > > are ignoring who *is* then liable in this case (the contributor!) as
    > > well as the implications of that liability given however Stanford/BI
    > > have chosen to use the contribution (i.e. Stanford/BI's loss in not
    > > being able to use the code, and the cost of redressing that loss).
    >
    > You're right, the contributor would be liable. I don't disagree with the
    > examples you present in this e-mail; I wanted to correct your licensing
    > loophole examples in your original e-mail. However, let me also point out
    > that not having an indemnification clause in the license does not protect
    > you, the contributor, from being liable either.

    Good point. However if contributions are made under a license like the
    X/MIT License, author liability is disclaimed. For example:

    http://software-carpentry.codesourcery.com/mit-license.html

    THE SOFTWARE IS PROVIDED "AS IS", WITHOUT WARRANTY OF ANY KIND,
    EXPRESS OR IMPLIED, INCLUDING BUT NOT LIMITED TO THE WARRANTIES OF
    MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE AND
    NONINFRINGEMENT. IN NO EVENT SHALL THE AUTHORS OR COPYRIGHT HOLDERS BE
    LIABLE FOR ANY CLAIM, DAMAGES OR OTHER LIABILITY, WHETHER IN AN ACTION
    OF CONTRACT, TORT OR OTHERWISE, ARISING FROM, OUT OF OR IN CONNECTION
    WITH THE SOFTWARE OR THE USE OR OTHER DEALINGS IN THE SOFTWARE.

    This is the complete opposite of a blanket indemnification as in
    "permission to use".

    Simply creating or submitting infringing code probably in most cases
    does not create as much liability as using it, redistributing it, or
    sublicensing it, since the party whose IP is infringed may have to prove
    damages, and greater damage would be shown by commercial activity
    involving infringing code rather than just having emailed it once to
    someone else.

    If Stanford or BI were to take contributions made under such a license
    like X/MIT and then sublicense those contributions to third parties or
    alternatively embed them in the next generation of internet routers or
    set-top boxes or such, the liability would not be on the contributor but
    instead would be on Stanford or BI. And as far as I am concerned, that
    is where liability should be because Stanford or BI would probably be
    doing such licensing for a fee. "Contributory Infringement" includes
    making it easier for someone else to infringe. I think the author might
    under some cases be liable for contributory damages, especially if the
    act was willful, but I am not sure of the extent of these damages,
    except to guess they would be much smaller if applicable at all in most
    cases (but I am not sure of this).

    Obviously it is in Stanford / BI's interest to get a statement of
    originality "to the best of the author's knowledge" if they serve a role
    of repackager -- that is due dilligence and ensures against intentional
    infringement. An example is:
      http://www.python.org/patches/bugrelease.html
    I would have no major issues with making such statements if I were
    submitting such code.

    The line of reasonableness is crossed (in my opinion) when Stanford / BI
    wants contributors to shoulder a financial risk for no significant gain
    to the author, as part of a process that may provide a potentially
    significant financial gain to Stanford / BI. And as a practical basis,
    with the way the US PTO is handing out software patents, is is
    practically impossible for a contributor to know what existing or
    soon-to-be-issued patents (valid or not) they may have innocently
    infringed, especially in a field changing as rapidly as knowledge
    management.

    For what it's worth, that is why my wife and I have turned down having
    our software included on a CD in a book by a major publisher who
    requested we blanket indemnify the publisher (no control over legal
    defense, etc.). They didn't offer us any money -- just a copy of the
    book (which was about a related topic and by someone else) and of course
    the potential advertising value of being on the CD. While we believe
    our work does not infringe any third party's IP, still it was too great
    a risk for a small company -- since if someone did claim the software
    infringed something, we might be liable for every copy of the CD
    distributed by the publisher, and they provide a big target. (Our
    standard product licenses disclaim liability in various ways.) Note that
    if we had armies of IP lawyers on staff, we might well have said yes. We
    have allowed our software to be on CDs in other books and magazines
    where publishers have not asked us to sign such agreements.

    (I am not a lawyer, so contact your own lawyer before making decisions
    regarding legal matters.)

    -Paul Fernhout
    Kurtz-Fernhout Software
    =========================================================
    Developers of custom software and educational simulations
    Creators of the Garden with Insight(TM) garden simulator
    http://www.kurtz-fernhout.com

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