Tuesday, May 12, 2009

Should software makers be liable for their code?

Many software vendors have an EULA (end user license agreement) that basically says that they do not guarantee their software makes a specific thing or is fitted for a specific purpose. Also they state they are not liable for almost anything that happens as a consequence of using that software. Here is an example from the Firefox EULA:

"4. DISCLAIMER OF WARRANTY. THE PRODUCT IS PROVIDED "AS IS" WITH ALL FAULTS. TO THE EXTENT PERMITTED BY LAW, MOZILLA AND MOZILLA'S DISTRIBUTORS, LICENSORS HEREBY DISCLAIM ALL WARRANTIES, WHETHER EXPRESS OR IMPLIED, INCLUDING WITHOUT LIMITATION WARRANTIES THAT THE PRODUCT IS FREE OF DEFECTS, MERCHANTABLE, FIT FOR A PARTICULAR PURPOSE AND NON-INFRINGING. YOU BEAR ENTIRE RISK AS TO SELECTING THE PRODUCT FOR YOUR PURPOSES AND AS TO THE QUALITY AND PERFORMANCE OF THE PRODUCT. THIS LIMITATION WILL APPLY NOTWITHSTANDING THE FAILURE OF ESSENTIAL PURPOSE OF ANY REMEDY. SOME JURISDICTIONS DO NOT ALLOW THE EXCLUSION OR LIMITATION OF IMPLIED WARRANTIES, SO THIS DISCLAIMER MAY NOT APPLY TO YOU.

5. LIMITATION OF LIABILITY. EXCEPT AS REQUIRED BY LAW, MOZILLA AND ITS DISTRIBUTORS, DIRECTORS, LICENSORS, CONTRIBUTORS AND AGENTS (COLLECTIVELY, THE "MOZILLA GROUP") WILL NOT BE LIABLE FOR ANY INDIRECT, SPECIAL, INCIDENTAL, CONSEQUENTIAL OR EXEMPLARY DAMAGES ARISING OUT OF OR IN ANY WAY RELATING TO THIS AGREEMENT OR THE USE OF OR INABILITY TO USE THE PRODUCT, INCLUDING WITHOUT LIMITATION DAMAGES FOR LOSS OF GOODWILL, WORK STOPPAGE, LOST PROFITS, LOSS OF DATA, AND COMPUTER FAILURE OR MALFUNCTION, EVEN IF ADVISED OF THE POSSIBILITY OF SUCH DAMAGES AND REGARDLESS OF THE THEORY (CONTRACT, TORT OR OTHERWISE) UPON WHICH SUCH CLAIM IS BASED. THE MOZILLA GROUP'S COLLECTIVE LIABILITY UNDER THIS AGREEMENT WILL NOT EXCEED THE GREATER OF $500 (FIVE HUNDRED DOLLARS) AND THE FEES PAID BY YOU UNDER THIS LICENSE (IF ANY). SOME JURISDICTIONS DO NOT ALLOW THE EXCLUSION OR LIMITATION OF INCIDENTAL, CONSEQUENTIAL OR SPECIAL DAMAGES, SO THIS EXCLUSION AND LIMITATION MAY NOT APPLY TO YOU. "

This practice has become common because the complexity of today's software, the almost endless possibilities in which a software can be used and the interaction with other systems. This makes offering a guarantee on what the software does a very risky thing for the software developer.

It seems the European Commission wants to change this practice and force the software providers liable for their software. Details can be read here. As a consumer I can be only happy that more rights are granted to me, but as a software developer I think enforcing such liabilities on a software provider will lead to dramatic changes in the way the software is produced and priced. It will be much more expensive and more limited in communicating with third party pieces of software. Is this good or bad in the end? It's hard to say, but this kind of law should be carefully evaluated before enforcing it.
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