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Aye, Robot, or Can Computers Contract?
Mark Rasch, 2007-11-16

A contract is usually described as a "meeting of the minds." One person makes an offer for goods or services; another person sees the offer and negotiates terms; the parties enter into an agreement of the offer; and some form of consideration is given in return for the provision of something of value. At least that's what I remember from first year law school contracts class.

With e-commerce, many of these elements have long been missing -- most generally the ability to negotiate the terms of a contract. Today, we may even have a situation where the humans have been taken out of the loop. Automated tools -- including automated replies, spiders, crawlers, and browsers -- may enter into contracts on our behalf, but without our knowledge.

That's a problem, when, in the ordinary course of browsing the Web or engaging in other electronic transactions, a person may enter as many as between 50 and 100 contracts a day. These include the terms of service (TOS) for your ISP, search engine, and browser, terms of use for a Web site, the privacy policies posted on the Web sites, copyright agreements or notices, trademark agreements or notices, warranties or disclaimers of warranty, and of course, the terms of software end user license agreements or EULAs. These agreements may include conditions on what you may or may not do on the site, an agreement to arbitrate disputes, an agreement to abide by and sue under the law of a particular jurisdiction, a granting of a license to use your information, and agreements not to use the information to which you are granted access in particular ways. In addition, an entity can condition your "access" to their Web site based upon your agreement to their terms and conditions -- failing to abide by their terms and conditions results not only in potential "breach of contract" liability, but also in liability for trespass, unauthorized access to a computer, or the civil tort of "trespass to chattels."

The situation begs the question: Are such contracts binding and if so, binding on whom?

My Robot Ordered the Tickets

Take for example, the recent case of Ticketmaster L.L.C. v. RMG Technologies, Inc., (U.S.D.C., Central District of California, October 16, 2007.) Ticketmaster, like many other Web sites has a "Terms of Use" that you must agree to before they will allow you to directly enter their Web site. These terms allow people to access the site only for non-commercial purposes, and do not permit the use of "automated devices" to access the service. Both the terms of use and certain technological measures are intended to prevent people from accessing the site more than once every three seconds and to limit the number of tickets that can be purchased during any individual visit.

The defendants, RMG, created a tool they called the "Ticket Broker Acquisition Tool" (TBAT) that would repeatedly visit the Ticketmaster site to acquire tickets from the site. Despite a lack of direct evidence that proved the defendants personally visited the Web site, or agreed to the terms of use, the court found that the nature of the tool itself made the defendant liable for the "infringing" cache copies of the Ticketmaster site which were copied by the tool. The court found that it was "highly likely" that the defendants received notice of the terms of use "by actually using the Web site."

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Mark D. Rasch is an attorney and technology expert in the areas of intellectual property protection, computer security, privacy and regulatory compliance. He formerly worked at the Department of Justice, where he was responsible for the prosecution of Robert Morris, the Cornell University graduate student responsible for the so-called Morris Worm and the investigations of the Hannover hackers featured in Clifford Stoll’s book, "The Cuckoo’s Egg."
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