Plan for voting machine probe dropped after lawsuit threat (nj.com) [LWN.net]

Plan for voting machine probe dropped after lawsuit threat (nj.com)

Posted Mar 19, 2008 21:59 UTC (Wed) by wahern (subscriber, #37304)
In reply to: Plan for voting machine probe dropped after lawsuit threat (nj.com) by vomlehn
Parent article: Plan for voting machine probe dropped after lawsuit threat (nj.com)

This is an open, contentious question. Assuming that the machines are not being leased, a
court could find that the machines were purchased goods per the UCC, but treat the licensing
of the control software separately.

The contention with the UCC isn't about what constitutes a "good" (lots of commentators--and
courts--trip up here, missing the point), but what constitutes a "sale", i.e., per the UCC
passing of "title". This gets into notions of what "title" means when components of a product
fall under the current copyright regime, and the confusing nexus with traditional merchant
law.

Since Contract Law is devouring Property Law, the outlook doesn't look so good. Federal courts
are more apt to say, "well, you signed your rights away." "But, this UCC thing, we'll stick to
it's framework because its so darn convenient", even though the careful balance it struck is
obliterated when in practice "licenses" (the law of which generally trumps UCC and merchant
law) don't actually transfer title to anything, so the purchaser is put--and kept--at a
distinct disadvantage in any transaction. (Cf. ProCD, et al).

To the Free Software crowd this is somewhat counterintuitive, because we have this aversion to
thinking of software, etc, as "property". And maybe we should. But when you get into
adjudicating these sorts of disputes, especially between the "little man" and the "big man"
actual Property Law provides some nice features. Property Law traditionally has been averse to
these sorts of restrictions to title. Under a pure Property regime, the vendor could never
withhold the right/interest to tinker with the machine like this. Even if it was in a
contract, the court would probably find it invalid. Restrictions to alienability of property,
and to do with it as you pleased, were frowned upon. But because of the resurgence of Contract
Law, courts are more tolerant of these sorts of bargains.

The notion in Contract Law is that this sort of flexibility creates a better market, etc. But
this isn't realistic, and Property Law figured this out long ago. When things get too complex
transaction costs trump the marginal value of the exchange. Also, this unfettered ability to
dicker and often dictate terms amplifies asymmetrical bargaining positions (and they're
_always_ asymmetrical, because this is _reality_).

In this instance, the municipality probably didn't think that the value of being able to
examine the control software was worth much; they discounted the price. Even if they weren't
naive, the present value of that right was certainly discounted relative to the present value
of the remainder of the machine, because they needed to use the machine right away but would
never need to inspect it till later. (This is very roughly related to the time value of
money.) And the vendor could leverage this when bargaining for terms. Of course, now the
municipality is locked into the contract, and left with an effectively adulterated title.
They've just been had, and probably have no recourse in the courts.

Anyhow, it's all very discouraging.

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Plan for voting machine probe dropped after lawsuit threat (nj.com)

Posted Mar 19, 2008 22:58 UTC (Wed) by wahern (subscriber, #37304) [Link]

I should say that Stallman's arguments concerning binary code still hold water, IMO. Because
of the nature of software, compiled code is really derivative (and lesser than) the actual
source code. What you're buying is really just a service, because since you have almost zero
practical ability to manipulate the software, you're de facto subject to the vendor's whims;
it has no resaleable or potential capacity for additional marginal value in itself.
Philosophic notions of property were that rights were granted--and other's restricted--to
allow the purchaser (aka rights holder; you were purchasing rights)--to improve upon the
product; if you have no ability to improve upon it, it's not consonant to say that you bought
property, because the concept of property is predicated on this societal benefit.

Intellectual Property Law only compounds this fact, of course, so that its even further
removed from traditional notions of property (which were never about physical objects, mind
you, but about rights and interests between people). The notion of benefit has been turned on
its head. You're not protecting the rights of the person purchasing something, but of the
person selling something. You're not ex ante promoting innovation and investment into a
particular thing, but ex post rewarding somebody who already did the work.

Maybe thats okay, and "IP" has its own internal logic, but its not consistent with the
definition of "property". In fact, it's much more consistent with the purpose of Contract Law,
where the idea is to entice people to exchange, and to give legal effect to their promises.
It's just a shame people, and jurists, conflate these ideas.

Anyhow, that's my opinion. IANAL, and my law professors think I'm cuckoo.

Plan for voting machine probe dropped after lawsuit threat (nj.com)

Posted Mar 21, 2008 16:34 UTC (Fri) by giraffedata (subscriber, #1954) [Link]

You missed some more basic points in response to the question of whether the UCC gives the county the right to do that analysis because the county "owns" the machines.

Lawyers rarely use the term "own" because it's too abstract. Nobody absolutely owns or doesn't own anything. Consistent with this, you used the word "title" instead.

Though the UCC goes into great detail about how title transfers (that's the "commerce" in the name Uniform Commerical Code," it doesn't say what rights come with title. That's a matter for much older property law. So the UCC is simply irrelevant to this issue.

I believe the devouring of property law by contract law with respect to anything but land was over long ago. Society has found that we're better off with free commerce than with fixed rights, so e.g. Union County has the right to sell its privilege to analyze voting machines.

Finally, since we're speaking of areas of law, you didn't make it clear that the area that is probably involved more than anything is copyright law. Sequoia presumably has some right in copyright law to stop Union County from using these machines and in exchange for Sequoia giving up that right, Union County agreed to give up its own right to analyze them.

Plan for voting machine probe dropped after lawsuit threat (nj.com)

Posted Mar 22, 2008 2:15 UTC (Sat) by dvdeug (subscriber, #10998) [Link]

A basic fact of US copyright law and computer programs is that once you own a legal copy of a
computer program, you have the right to use it, explicitly including the making of any
temporary copies needed to do so.

Plan for voting machine probe dropped after lawsuit threat (nj.com)

Posted Mar 22, 2008 2:53 UTC (Sat) by giraffedata (subscriber, #1954) [Link]

It certainly seems that way, but the article I read said it was an issue with a "license" that convinced Union County it couldn't analyze the voting machines. There's no such thing as a license to deploy a voting machine, so it sounded to me like they were talking about a copyright license. Without any more details, I wouldn't swear that there's no way they could have arranged things so that copyright law gives Sequoia control over how the machines are used, but thinking again, I think it's most likely that the author confused a copyright license with the contract under which Union County got one. Or maybe it's a patent license.

Plan for voting machine probe dropped after lawsuit threat (nj.com)

Posted Mar 26, 2008 1:25 UTC (Wed) by wahern (subscriber, #37304) [Link]

Protestations of distinguished people like Eben Moglen notwithstanding, generally speaking, a
judge can treat any term of a "license", which technically might not conform to Copyright Law,
as a term of a collateral contract. And because these days you can contract for just about
anything (w/ limited historical exceptions, peaking in the 1960's and diminishing since),
Union County could be found liable for breach of contract, and forced to pay through the nose.
Remember, the amount of "damages" that Intellectual Property holders claim is up in the air as
a practical matter, so there's significant risk to Union County.

Plan for voting machine probe dropped after lawsuit threat (nj.com)

Posted Mar 26, 2008 1:05 UTC (Wed) by wahern (subscriber, #37304) [Link]

I agree that the UCC isn't relevant to the specific case, because this definitely turns on the
licensing issue.

But I disagree that the UCC doesn't specify what rights are transferred with title. The UCC
says (S. 2-401) that the only interest in title that can be reserved is a security interest.
And a seller whose title is encumbered can still transfer full title to a bona fide purchaser
for value.

Granted, S. 2-403, which recites the BFPV rule, leaves some doubt in my mind. Specifically,
the first sentence, "A purchaser of goods acquires all title which his transferor had or had
power to transfer except that a purchaser of a limited interest acquires rights only to the
extent of the interest purchased." But, S. 2-401(1) seems, on its face, unequivocal: "Any
retention or reservation by the seller of the title (property) in goods shipped or delivered
to the buyer is limited in effect to a reservation of a security interest." So I assume
(though I haven't looked at caselaw, and my treatises at hand don't address this issue) the
2-403 wording is merely accommodating the allowance for security interest.

I also disagree that we're better off with "free commerce" as opposed to "fixed rights";
specifically, I believe it's a false dichotomy. By assuring that specific sets of rights are
not divisible, you promote free commerce in the future. If Sequoia and every other vendor can
restrict usage like this, I fail to see how the free market will address the immediately
resulting inequalities. Now, my personal understanding isn't requisite to keep the world
turning. Nonetheless, my contention is that there are certain structures necessary, or at
least preferable, to ensure the efficient operation of the market. As I stated previously, you
want to fix the quanta of rights at the point where transaction costs (both local and
non-local to the transaction) are minimized relative to the value creation. (I'm not saying
these decisions should be made on high; part of my contention is that a thousand years of
Common Law, and earlier Roman history, have something to say about what is efficacious or
not.)

If you allow indiscriminate fracture of property interests, you're increasing future
transaction costs to reassemble those interests. That means future potential preferable
exchanges will be too expensive. (For instance, you buy closed source software; 15 years later
you'd really like the source code, but its long destroyed. The long-term potential of the
market has been irreversibly diminished in a way that would have only been prevented by (a) an
Oracle or (b) systemic principles.) Again, this is a fundamental precept in Property Law, and
it's not the lesser because of all the other crufty and inequitable rules which also survived
through the Common Law.

Fixed rights are like currency. A totally "free market" would have a perfectly and infinitely
divisible unit of currency. That's not possible. Similarly, it doesn't make sense to argue
that "rights" should be perfectly divisible. Indeed, we don't even desire the minimally
possible unit of currency--e.g. the penny (that's not to say fractions of a minimum unit don't
have utility, usually in highly specialized and automated markets where specific transaction
costs are different). Similarly, the market will function just as efficiently--nay, likely
more so--by the use of a larger unit of exchange of rights. And in the interests of equity, it
makes sense, as a social and political matter, to put a minimum bound on the exchange of
rights to bolster and protect the civil rights of individuals, secure in the fact that
there're no countervailing economic costs.

So, it's a false dichotomy to propose that traditional Property Law necessarily hinders the
market. We can argue about where the bounds should be, and how they should be changed over
time. But bounds are useful. If someone believes in free markets (I do), it's not enough to
wave hands and chant "free market". I can get into my opinions on the inherent limitations of
Contract Law devices like Unconscionability, but I've obviously yammered on enough.

Plan for voting machine probe dropped after lawsuit threat (nj.com)

Posted Mar 26, 2008 2:30 UTC (Wed) by giraffedata (subscriber, #1954) [Link]

The parts of UCC you quote demonstrate my point. They go into technical detail about how and how much title gets transferred, but never even attempt to say what it is that's being transferred. And that's not poor draftsmanship; it was a goal.

You can say title is defined as the right to transfer title to someone else, but that's really a circular definition.