A new approach is needed

dlw danw6144 at insightbb.com
Mon Aug 30 13:48:57 UTC 2004

Current open source licenses are under attack in the
legal world.  Contracts are central to the issue.
The Free Software Foundation's Eben Moglen states:

"This right to exclude implies an equally large power to
license--that is, to grant permission to do what would
otherwise be forbidden. Licenses are not contracts: the
work's user is obliged to remain within the bounds of the
license not because she voluntarily promised, but because
she doesn't have any right to act at all except as the
license permits."
Enforcing the GNU GPL by Eben Moglen

The crux of Professor Moglen's argument is that the "in rem"
property rights of the owner of a copyright empower the
owner to place restrictions on the copyright absent any
involvement with contract law --- which involves "in
persona" personal rights distinct from property rights.
Property rights and personal rights cannot be mutually
exclusive though... people must deal with people concerning
their respective property ownership. Contracts provide a
mechanism or "interface" between property rights and
personal rights.  

Here's what Raymond T. Nimmer (~Melville B. or David )
states about the interface between property and contract

"In transactional relationships, property rights (including
intellectual property rights) may furnish background or
default rules that govern the transaction unless otherwise
agreed. From a contract law standpoint (as compared to
contracting practice), setting out background principles is
the primary function of intellectual property law. More
generally, the essence of any property right is that the
owner can transfer or withhold transfer of its property.
Transfers, to be effective, implicate contract law as the
basis for defining the value received and the interests
conveyed. "
The the Court of Appeals for the Federal circuit on a
closely related intellectual property matter concerning this
"interface" published an opinion in 2001 holding that any
license concerning a patent is a contract:

"The Supreme Court stated:
Any language used by the owner of the patent or any conduct
on his part exhibited to another from which that other may
properly infer that the owner consents to his use of the
patent in making or using it, or selling it, upon which the
other acts, constitutes a license and a defense to an action
. . . . De Forest Radio Tel. Co. v. United States, 273 U.S.
236, 241 (1927). When warranted by such a course of conduct,
the law implies a license. Devices for Medicine, Inc. v.
Boehl, 822 F.2d 1062, 1068, 3 USPQ2d 1288, 1293-94 (Fed.
Cir. 1987). Whether express or implied, a license is a
contract 'governed by ordinary principles of state contract
law.' Power Lift, Inc. v. Weatherford Nipple-Up Sys., Inc.,
871 F.2d 1082, 1085, 10 USPQ2d 1464, 1466 (Fed. Cir. 1989)."
JAZZ PHOTO, ET AL. v ITC , 264 F.3d 1094 (Fed. Cir. 2001)
c h&case=/data2/circs/Fed/991431.html>

The "license is contract" principle poses a serious problem.
The fact that all licenses are contracts leaves any
copyright license open for examination under both the
common law rules of states as well as the Federal Statutes.
The Federal statute 17 USC Sec. 301 is of profound
importance to the future of open source licensing.
Currently prevailing interpretations of Sec. 301
generally insist that that an "extra element" different
from just restrictions placed upon Sec. 106 rights is
required to avoid preemption.

 Here is an excerpt from 1 Nimmer on Copyright
§1.01[B][1][a] which states:
 "   [a] Breach of Contract. Adverting first to contract
rights, an author's right to royalties under a publication
contract may be conditioned upon the publisher's acts of
reproduction and distribution of copies of the work, but
there is also another crucial act that stands as a condition
to the publisher's liability: the publisher's promise to pay
the stated royalty. Without a promise there is no contract,
while a promise on the part of one who engages in unlicensed
reproduction or distribution is not required in order to
constitute him a copyright infringer. Certainly, pre-emption
should be denied, to the extent that a breach of contract
cause of action alleges more than reproduction, adaptation,
etc. simplicter of a copyrighted work,"

A second problem is the nature of a contract that attempts
successive assignments of rights or delegations of duties.
Even if all the identities of the ever growing number of
successive parties to an open source license e.g. the Common
Public License are preserved for privity, since the number
of parties is essentially unlimited (how many people are in
the public domain?) this appears as a scheme to formulate a
"right against the world" and probably triggers preemption.

I believe open source advocates should think about
forming some sort of corporation or foundation with
"benevolent" restrictions in its charter. Individual
copyright ownership could  then be transferred to the
foundation. Perhaps joint ownership is a plausible
solution. Several thousand open source coders "employed" by
one benevolent foundation is easier for me to accept than is
a software distribution that is released with several
thousand copyright party attributions named in several
thousand files. Linus would make a good CEO.

In any event I believe fresh approaches to the concept
of open source licensing are about to be mandated by
the events currently  transpiring in the area of
intellectual property law.

Daniel Wallace


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