[Hague-jur-commercial-law] March 5, 2004 Techdaily story on roundtable on The Hague

[Manon Ress]

March 5, 2004.  Technology Daily

Groups Restate Objections To Treaty For Business Disputes
by Drew Clark

Groups representing consumers, libraries and educators on Friday 
expressed their continuing reservations to the State Department about a 
proposed international treaty on jurisdiction`for e-commerce and other 
cross-border  businesses disputes.
    
Groups like the Consumer Project on Technology (CPT) still strongly 
criticized the treaty, the Hague Conference on Private  International 
Law, which would establish a set of global rules about whose laws and 
which judiciary would hear court cases  arising from contract disputes. 
"The Hague changes everything because
everyone then is subject to everyone's jurisdiction," CPT's James Love 
said. He said drug companies and movie studios could use the convention 
to force distributors into contracts constraining resale rights.

The treaty, which had been in slow motion for nearly a decade, last year 
picked up momentum as European nations narrowed their ambitions and U.S. 
negotiators successfully narrowed provisions opposed by U.S. businesses 
and consumer groups.
    
Some of the most controversial provisions to CPT, the American Library 
Association and others relate to intellectual property, form contracts 
like those included with "shrink wrap" or "click wrap" software, and how 
judgments contrary to U.S. public policy would be enforced in American 
courts. "It is a much more focused project than it was before," said 
Jeff Kovar of the State Department, who is leading the U.S. 
negotiations. "There are a lot fewer issues to deal with" than
previously.
    
The convention is now limited to enforcing choice-of-court clauses 
within business-to-business contracts that identify which country's 
courts would have jurisdiction over disputes involving businesses in two 
countries. It also would enforce those courts' judgments.
    
That approach is significantly less ambitious than the original 
proposal. The treaty would not exclude returning later to more 
controversial issues, such as business-to-consumer contracts. But even 
the ability to choose which courts would hear disputes could convey 
disproportionate power to some, particularly holders of patents and 
copyrights, said Love and Miriam Nisbet of the American Library 
Association.
    
Libraries are particularly concerned about form contracts content 
providers that might limit their ability to lend digital materials to 
patrons, Nisbet said. "If the library has negotiated such a license and 
is willing to restrict its ability [to lend] because [of] getting such a 
good deal, that may be one thing," she said. "But we have a huge problem 
with a non-negotiated contract" like a click-wrap electronic publishing 
agreement.
    
Some public-interest groups consider such agreements on digital goods to 
be legally suspect, although American courts generally have upheld them. 
But in the United States, those contracts are limited by the "first 
sale" doctrine, which declares that a library or a video store retains 
the right to lend or resell books or videos.
    
The power to impose one-sided agreements would worsen, Love said, if 
drug companies or copyright holders could dictate that disputes are 
heard in certain countries. "Part of it is [making it] inconvenient" for 
businesses to be sued, Love said. "Part is forum shopping, a way of 
picking your legislator" with the country whose laws are most agreeable 
to intellectual property holders.

 


-- 
Manon Anne Ress
Consumer Project on Technology
www.cptech.org
PO Box 19367, Washington, DC 20036
manon.ress@cptech.org, voice: 1.202.387.8030, fax: 1.202.234.5176