Letter (February 1998) from IEEE to the Article 2B drafting
National Conference of Commissioners on Uniform State Laws
676 North St. Clair Street Suite 1700
Chicago, IL 60611
Re: UCC Article 2B
On behalf of the IEEE United States of America (IEEE-USA) and
its 220,000 U.S. members who are electrical, electronics, and
computer engineers, we wish to comment on Article 2B of the Uniform
The IEEE-USA Intellectual Property Committee and the IEEE-USA
Committee on Computers and Information Policy have reviewed your
activities and find them very commendable. It is clear that your
committee has worked hard during the past several years in trying
to reach a uniform system for the licensing of intellectual property
and computer software.
However, we have some recommendations which we believe may
enhance your present draft. At this time, since the UCC 2B document
is still in a state of flux, we will make specific recommendations
but will not offer specific language. We will be happy to work
with you at a later date to develop specific language. The following
is a list of IEEE-USA's recommendations:
- Software proprietors should not be able to avoid the impact
of the exhaustion doctrine by designating a transaction as a
license or bailment rather than a sale when the transaction appears
to be a sale.
- An owner of rights should be allowed to withhold authorization
of some uses, where the action is reasonably calculated to achieve
a legitimate objective of the owner. This is true as long as
the limitation or restriction does not violate any specific prohibition
imposed by federal statute. For example, a limitation and restriction
imposed solely to prevent infringement of intellectual property
rights should be rebuttably presumed reasonable. A price-fixing
limitation, conditional restriction is conclusively presumed
- Self help protection can adversely affect the health and
safety of people and property, and can endanger lives whether
intentionally, unintentionally, or improperly activated. Those
who embed self help protection in their software must be responsible
for its operation, whether inadvertent or intentional and should
not be disclaimable. That responsibility should not be limited
by privity of contract but should extend to those persons who
lawfully obtain the software or reasonably may be foreseen to
be users of the software directly or indirectly.
- Contract terms that frustrate rights otherwise afforded by
intellectual property law should not be enforceable.
- One should not be able to disclaim incidental or consequential
damages in situations where there is a known defect undisclosed
and the damage is of the type reasonably foreseeable.
- For mass markets and when the amount in controversy is within
the Customer's home state's small claims court jurisdiction limit,
then the Customer should be able to bring an action in the home
state or if he cannot obtain personal jurisdiction of the defendant
in his home state, then anywhere he can obtain jurisdiction over
Please contact Scott Grayson, Manager of Career Activities,
if you wish to discuss these matters further. He can be contacted
at (202) 785-0017 ext 339 or via email at "Scott D. Grayson"
Sincerely, John R. Reinert, D.M. IEEE-USA President
cc: Michael Andrews Ned Sauthoff Tom Suttle Scott Grayson Deborah
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