ProCD, Inc. v. Zeidenberg

86 F.3d 1447 (7th Cir. 1996)

 

RULE:

A copyright is a right against the world. Contracts, by contrast, generally affect only their parties; strangers may do as they please, so contracts do not create "exclusive rights."

FACTS:

Appellant included a shrink-wrap license in its packaged software. Appellant also chose to discriminate in its pricing of the software between commercial and non-commercial users. Appellee purchased a consumer package of the software, but chose to ignore the license restricting its use to non-commercial purposes. Seeking to enforce the license, appellant filed for an injunction. The trial court denied the injunction, holding that the license was ineffectual because the terms did not appear on the outside of the package. 

ISSUE:

Should the injunction be granted?

ANSWER:

Yes.

CONCLUSION:

The court held that the license was to be treated as an ordinary contract accompanying the sale of products. While the terms of the license were included within the package, its terms afforded the purchaser an opportunity to review the product and its terms before being bound. Since the license agreement was a two-party contract, it was not equivalent to the rights of copyright.

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