Vol 7 No 1 - Roger Williams University School of Law

Contract FormationThe second area of controversy that may have importantramifications on the CISG discussions on electronic contracting isthe treatment of contract formation issues in the context oflicensing, and in particular, its application to shrink-wrapsituations (where an item is purchased in a box or wrappingcontaining language that by opening or using the item, the userconsents to terms contained therein) as well as click wrapsituations (where a party signifies it acceptance of new oradditional terms by a mere mouse click). In many respects, thissecond set of issues deal with straight contract formation.Theoretically, contract formation rules should be the same, nomatter what the nature or subject matter of the transaction,59 yetthere was continual tension between the Article 2 and Article 2Bprocesses as to what those correct contract formation rules shouldbe. The contract formation rules of UCITA have proven to bequite controversial, in large part because of their impact uponintellectual property law regimes.60 Even apart from theircontent, however, the approach exemplified by UCITA’s provisionshas been challenged, and indeed they have not been mirrored inthe Article 2 contract formation provisions.61UCITA legitimates both shrink-wrap and click-wrapagreements.62 Key to its provisions is the concept of “manifestingassent” after an “opportunity to review” the terms of a standardthe floor of the Conference by a vote of 60 to 98, but a motion necessary to obtainNCCUSL approval of the entire project (including the new scope provision) failed on avote of 53 to 89. This leaves the issue of the scope of revised Article 2, and indeed thelarger question of whether there will ever be a revised or amended Article 2,unresolved.59. As Judge Easterbrook said in Hill v. Gateway 2000, Inc., 105 F.3d 1147, 1149(7th Cir. 1997), cert. denied, 118 S. Ct. 47 (1997) (involving a purchase of a computerwhich was delivered with new and additional terms), about attempts to distinguish theprior case of ProCD v. Zeidenberg, 86 F.3d 1447 (7th Cir. 1996) (involving purchasedsoftware which came with a shrink-wrap license limiting use): “ProCD is about the lawof contract, not about the law of software.”60. See infra notes 123-44 and accompanying text; see also Brennan, supra note50.61. See, e.g., Speidel, Trenches, supra note 12; Rusch, supra note 12.62. Most shrink-wrap or click-wrap agreements would qualify as “mass market”licenses under UCITA’s provisions, and their enforceability would be governed byUCITA § 209. See UCITA § 112 & official cmt. 5 (setting forth several illustrations ofthe enforceability of click-wrap agreements).