Judge Orders Software Developer To Remove And Stop Using Deceptive And Restrictive Clauses

Attorney General Spitzer today announced that a judge has enjoined software developer and retailer Network Associates from selling its products with a speech restriction the company had placed on its products. A lawsuit brought by Spitzer last year contested the legality and enforceability of a clause Network Associates included for several years with its software products, which purported to prohibit users from publishing "product reviews" or "benchmark tests" without the company's permission. These restrictions have appeared on Network Associates' software diskettes, as well as on the company's web site, from which consumers may download software.

"We are very pleased that the court struck down this highly restrictive clause," Attorney General Spitzer said. "Such clauses censoring speech and criticism chill not only consumers' speech, but also prevent academics, consumer advocates, and technology experts alike from openly and freely discussing software products. Restrictions like these threaten to hinder the spirit of innovation and critical appraisal the public needs to keep software effective, efficient, and safe."

Manhattan Supreme Court Justice Marilyn Shafer permanently enjoined Network Associates from "distributing, advertising and selling its software" with the following language, sections (b) and (c) of which the Attorney General's pleadings had referred to as the "Censorship Clause":

Installing this software constitutes acceptance of the terms and conditions of the license agreement in the box. Please read the license agreement before installation. Other rules and regulations of installing the software are:

a. The product can not be rented, loaned, or lease - - you are the sole owner of this product.

b. The customer shall not disclose the result of any benchmark test to any third party without Network Associates' prior written approval.

c. The customer will not publish reviews of this product without prior consent from Network Associates, Inc.

The court further enjoined the company from including with its products "any language restricting the right to publish the results of testing and review" unless the company first gives the Attorney General 30 days notice. The court also required Network Associates to provide it with evidence of its sales, so that the court can set penalties and costs.

In striking down the above clause as "deceptive" and "not merely unenforceable, but warrant[ing] an injunction and the imposition of civil sanctions" under New York's Executive Law and General Business Law, the court noted that on at least one occasion, Network Associates had used the clause to quell a critical review. That review, published in 1999 by Network World, had compared Network Associates' "Gauntlet" firewall software unfavorably to five other firewall products. Spitzer's suit described how Network Associates had demanded a retraction of the negative review, citing the language of the now-prohibited clause.

"Whether the subject is political debate, debate in the arts and sciences, or debate over what software to buy, we must protect free and open speech from intimidation. The public has a right to information about products, and technologists have a right to create and innovate, so long as they adhere to the law when doing so," Spitzer said. "After all, we will lose the benefits of life in the Information Age if language contained on web sites or product packaging prevents citizens from participating in vital exchanges of information."

Computer academics and technologists in particular applauded the decision. Faced with such restrictive clauses when writing papers and conducting testing, some researchers and academics have had to refer to commercial database and other technology packages without giving product names.

Professor Stephen Vavasis of Cornell University's Department of Computer Science, whose letter regarding these issues was submitted to the court, welcomed the decision and noted its importance. "The Attorney General has won a major victory for computer users in general and computer science educators in particular. Like any field of science or arts, progress in computer science requires experts to constantly trade opinions and evaluations. Students and end-users rely on these evaluations in the same way that consumers rely on auto magazines when buying cars. Some software companies were hoping to escape from evaluation and testing via restrictive clauses buried in their license agreements. Fortunately, the Attorney General prevailed in his mission to preserve the traditional rights of New York consumers."

Professor Vavasis also said that several colleagues in his own department have been compelled to conceal important information they obtained from testing software because of the threat of being sued for violating such a license agreement.

The case was handled by Ken Dreifach, Chief of Spitzer's Internet Bureau, assisted by Internet Investigator Vanessa Ip.