· Prohibitions on transfer of shrink-wrap software, forcing businesses undergoing ownership changes to strip off all PC software rather than face the legal and technical costs of identifying, renegotiating or removing specific restricted licenses.

· Requirements specifying where and under what law legal disputes will be handled (WordPerfect mandates Ireland).

· Warranty disclaimers that absolve publishers of damages for defective software.

User advocates say NCCUSL drafters have sold out to an uncompromising software industry. That's certainly a possibility, but this highly polarized debate may be more nuanced. It certainly reflects fundamental philosophical differences, such as:

· whether federal or state courts should exert the greater influence over the development of digital information law, including software licenses;

· whether it's better to build the law of information technology in a free-market, free-contracting construct or defer to existing intellectual property laws (which seek to balance ownership rights with public interests, such as competition, transfer, archival and other fair use of technology); and

· whether it's better to bring all information industries under a single legal approach or continue to defer to laws that have grown up around non-software information industries.

Many of those non-software industries, such as cable, film, recording and print publishers, saw their efforts to change 2B result in a committee decision to remove these older technologies from the article. But even though 2B is now limited to digital technology, there is fear that older technologies' rapidly emerging digitization will bring them back under 2B. That's the main reason many now favor halting 2B altogether. And while 2B's greatest import lies with shrink- and click-wrap software, it also includes provisions that change the law of negotiated software licenses.

The biggest danger of 2B, says ALI member and Washington University law professor Charles McManis, is that it creates "such a powerful unilateral contract tool in shrink-wraps that the public has virtually no opportunity to negotiate more favorable software licensing terms."

Business and consumer advocates say 2B is brilliant in the way it accomplishes this task. For example, 2B's text makes no specific mention of intellectual property law and the public interests it safeguards (though notes, which can be removed, do refer to intellectual property law). More important, by allowing software publishers to use shrink- and click-wrap licenses to preselect the particular law to be used in litigation, 2B provides strong incentive to litigate most license cases under 2B contract law, rather than intellectual property law. Because federal courts typically hear cases brought under intellectual property law, many 2B opponents think state courts will give greater deference to contract law, with which they are most familiar. Thus 2B puts much of the development of digital law squarely inside a free-contract construct, where the only appeal lies with the expensive and unlikely option of U.S. Supreme Court resolution.

Since contract law can be used to negate protections in federal law, 2B opponents are concerned that state courts will honor the kind of one-sided, one-handed handshakes they see in today's shrink- and click-wrap licenses. They point out that even speech can be restricted under contract laws, citing nondisclosure/beta agreements as an example. One concern is that 2B dramatically increases the odds that the many unjust terms that populate software licenses will be enforced by the courts; another is that the threat of legal action will cause businesses and consumers to abide by terms that are fundamentally unfair.