Massachusetts could be fifth to adopt anti-UCITA law

A Massachusetts legislative committee held a hearing this week on an anti-UCITA bill, and the state could become the fifth to enact a law whose sole purpose is to protect its residents and businesses from the controversial software licensing law.

The hearing underscores the difficulties that have confronted backers of the Uniform Computer Information Transaction Act (UCITA). Only two states, Virginia in 2001 and Maryland in 2000, have enacted the model legislation, while four states have adopted anti-UCITA measures. UCITA’s progress toward state-by-state adoption appears, for now, to be stalled.

John McCabe, an official at the Chicago-based National Conference of Commissioners on Uniform State Laws (NCCUSL), which sponsors uniform laws, said a UCITA adoption bill is pending in the District of Columbia, but that’s it. With state legislatures generally winding down for the year, the District of Columbia is “the only expectation that we have at this point,” he said.

The measures adopted by the four anti-UCITA states — Iowa, North Carolina, West Virginia and, just last month, Vermont– are called “bomb-shelter” legislation, intended to prevent a vendor from applying, for instance, Maryland’s UCITA law provisions on residents in a bomb-shelter state.

The Massachusetts Joint Committee on Commerce and Labor held a hearing on the anti-UCITA bill Monday. No action was taken, a committee spokesperson said.

UCITA’s opponents, who include library and consumer protection groups, a majority of state attorneys general and some large software users, say they succeeded in preventing UCITA’s adoption in Oklahoma and Nevada this year. Despite those successes, however, they say UCITA remains a threat.

“It’s not dead yet,” said Randy Roth, a principal of Corporate Contracts LLC in Des Moines, Iowa, a consulting and contract negotiation firm. But Roth said awareness and concern about UCITA is dwindling — and that worries him. “The message to that group is, Don’t let your guard down,” he said. “We can’t let up yet.”

Carlyle “Connie” Ring Jr., chairman of the NCCUSL’s UCITA drafting committee, said proponents will continue to press for state-by-state adoption. He argued that companies need a uniform set of rules to conduct Internet transactions, and if the states don’t adopt these rules, Congress will.

“The real issue is whether the states are going to work this out among themselves,” he said.

Ring attributed the lack of state adoptions to the 18-month withdrawal of UCITA, under an agreement with the American Bar Association, which reviewed the UCITA and ultimately took no action on it after a special bar committee criticized the measure.

UCITA, according to opponents, sets default contract terms that favor software vendors and free them of liability for any software problems. Supporters say companies are free to negotiate terms and conditions, and they have attempted, unsuccessfully, to ameliorate concerns by removing some controversial provisions, such as “self-help,” which would have allowed a vendor to disable a system during a dispute.