Contract or License?

Lawrence E. Rosen lrosen at
Thu Sep 13 21:34:17 UTC 2001

I've been following the discussion about the RealNetworks' RTSP Proxy
License and the question about whether a license can restrict "use" as
opposed to copying, creating derivative works or distributing those
copies and derivative works.

Copyright law does not restrict use of an authorized copy.  To the
extent that the author of software relies solely on a copyright notice
to inform prospective users of her rights, then owners of authorized
copies can use that software without further permission.

However, a contract can impose restrictions on use; contract law allows
consenting adults to agree to accept conditions on their use of software
or any other product.  (There are minor exceptions: The courts won't
enforce restrictions on use based on race, religion, sex, etc. of the
user, since that would violate certain constitutional principles of
equal protection.)  To the extent that a software license is a contract,
restrictions on use are enforceable.  

OSD provisions prevent OSI's approval of licenses that discriminate
against persons or groups or fields of endeavor, or that restrict
license rights to a specific product.

The author of the note below admitted that he doesn't understand the
distinction between a contract and a license.  (Unfortunately, he
confuses that question by using the terms "unilateral" and "bilateral,"
which describe two different types of contracts.)  I must admit that,
even though I am an attorney, I have never understood the distinction
between a software license and a contract.  Can anyone on this list cite
any legal authority (other than an assertion by the license author) for
the proposition that a software license is not a contract?  

/Larry Rosen

> -----Original Message-----
> From: Joseph Reagle [mailto:reagle at] 
> Sent: Friday, September 07, 2001 10:03 AM
> To: Jeffry Smith; license-discuss at
> Cc: www-archive at
> Subject: Re: RealNetworks' RTSP Proxy License
> On Friday 07 September 2001 12:01, Jeffry Smith wrote:
> > A key point that I've found on Open Source - you place the 
> license on
> > REDISTRIBUTION, not use.  Remember that, under standard 
> Copyright, the
> > user has the right to use the software, but not redistribute new or
> > modified copies.  The Open Source licenses are what enable 
> that.  Thus,
> > by only specifying redistribution, you can mimic the GPL, 
> and say, in
> > effect "You don't have to agree with this license, but 
> nothing else gives
> > you the rights included.  Use of these rights indicates 
> acceptance of
> > this license."
> I've noted this distinction between an acceptance of a license 
> (unilateral?) and contract (bilateral?) before [1]; it's an 
> interesting 
> (and perhaps) important distinction that I don't completely 
> understand yet.
> However, based on this thread I went and had a look and most 
> of the OSI 
> license *do* restrict use:
Redistribution and use in source and binary forms, with or without 
Software without restriction, including without limitation the rights to

use, copy, modify, merge, publish, distribute, sublicense, and/or sell 
copies of the Software
(a) to use, reproduce, modify, display, perform, sublicense and
the Original Code (or portions thereof) with or without Modifications,
as part of a Larger Work


5. You are not required to accept this License, since you have not
it. However, nothing else grants you permission to modify or distribute
Program or its derivative works. These actions are prohibited by law if
do not accept this License. Therefore, by modifying or distributing the 
Program (or any work based on the Program), you indicate your acceptance
this License to do so, and all its terms and conditions for copying, 
distributing or modifying the Program or works based on it. 

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