ProCD, Inc. v. Zeidenberg

In ProCD, Inc. v. Zeidenberg, 86 F.3d 1447 (7th Cir. 1996), the Seventh Circuit considered whether a consumer who purchased off-the-shelf software in a retail setting was bound by the shrinkwrap license agreement. The court first distinguished Step-Saver and Arizona Retail Systems on the grounds that "these are not consumer transactions." ProCD, 86 F.3d at 1452. The court further distinguished the decision in Step-Saver as a battle-of-the-forms case which had no application because "our case has only one form." Id. The court then explained why the license agreement was binding: A vendor, as master of the offer, may invite acceptance by conduct, and may propose limitations on the kind of conduct that constitutes acceptance. A buyer may accept by performing the acts the vendor proposes to treat as acceptance. And that is what happened. ProCD proposed a contract that a buyer would accept by using the software after having an opportunity to read the license at leisure. . . . The UCC permits contracts to be formed in other ways. ProCD proposed such a different way, and without protest Zeidenberg agreed. Id. In ProCD, Inc. v. Zeidenberg, involved a retail purchase of software, the Seventh Circuit held software shrinkwrap license agreements are a valid form of contracting under Wisconsin's version of U.C.C. section 2-204, and such agreements are enforceable unless objectionable under general contract law such as the law of unconscionability. ProCD, 86 F.3d at 1449-52. The court stated, "notice on the outside, terms on the inside, and a right to return the software for a refund if the terms are unacceptable (a right that the license expressly extends), may be a means of doing business valuable to buyers and sellers alike." ProCD, 86 F.3d at 1451.