Zeidenberg, a graduate student, purchased a telephone directory database, SelectPhone, on a CD-ROM produced by ProCD. ProCD had compiled the information from over 3,000 telephone directories at a cost of more than $10 million. To recoup its costs, ProCD discriminated based on price by charging commercial users a higher price than it did to everyday, non-commercial users. Zeidenberg purchased a non-commercial copy of SelectPhone and after opening the packaging and installing the software on his personal computer, Zeidenberg created a website and offered the information originally on the CD to visitors for a fee that was less than what ProCD charged its commercial customers.
The packaging of the CD-ROM stated that there was a license enclosed. Zeidenberg was presented with this license when he installed the software, which he accepted by clicking assent at a suitable dialog box.
ProCD brought suit for breach of contract. A lower court found for Zeidenberg, which ProCD appealed.
- Are shrinkwrap licences offers and does clicking OK constitute acceptance?
Easterbrook, writing for the court, held that a contract could confer among the parties similar rights to copyright as those rights are not "equivalent to any of the exclusive rights within the general scope of copyright".
The court then held the license valid and enforceable as a contract. The court held that Zeidenberg did accept the offer by clicking through. Easterbrook noted, "He had no choice, because the software splashed the license on the screen and would not let him proceed without indicating acceptance." The court stated that Zeidenberg could have rejected the terms of the contract and returned the software. The court, in addition, noted the ability and "the opportunity to return goods can be important" under the Uniform Commercial Code.
Shrinkwrap licences constitute a reasonable offer and confirming such a licence constitutes acceptance.