General Assembly passes bill on software regulation; Makers applaud act covering sales, licensing


Maryland lawmakers stepped bravely into the digital age yesterday, adopting pioneering legislation that will govern the sales and licensing of computer software in stores and over the Internet.

By wide margins, the House of Delegates and Senate gave final approval to a complex bill dictating what rights computer users have when they crack open a new, shrink-wrapped disk or download a program.

The Uniform Computer Information Transactions Act was the linchpin of an ambitious package of technology bills pushed by legislative leaders and Gov. Parris N. Glendening, who is expected to sign it. Lawmakers hope to make Maryland a magnet for software firms and Internet start-ups by being one of the first states to adopt a legal framework for computer commerce.

"It sends out a very aggressive message to the business community internationally that we really mean business in the e-commerce world," said House Speaker Casper R. Taylor Jr.

The bill's passage drew kudos from software manufacturers and Internet giants like America Online, who said Maryland is leading the way in setting nationwide ground rules in a rapidly developing industry.

"It's a step away from the Wild West, where you don't have recourse," said Emily Hackett, state policy director for the Internet Alliance, an industry group. "This is very good for consumers and for business."

But others worried that the state may have rushed headlong into a legal briar patch, which could hurt consumers, libraries, software designers and businesses that rely on computers.

"You don't see anybody but computer software companies clamoring for new rules," said Skip Lockwood, director of 4CITE, a Washington-based coalition of businesses and nonprofit groups fighting the legislation in state capitals around the country.

The bill was drafted by a pro-industry group seeking to get uniform computer commerce laws adopted by all 50 states.

But Maryland lawmakers tacked on several significant consumer protections, including a right to a refund if software does not work as advertised. There is no such guarantee in many legalistic license agreements that computer users must accept before installing software.

"It's pro-business and pro-consumer at the same time," said Senate President Thomas V. Mike Miller.

The bill also bars software firms from disabling a consumer's computer via the Internet in the event of a dispute. House and Senate members agreed to require that Maryland law would apply to any disputes between consumers and software firms, even if they are based in another state.

But they compromised on whether the lawsuit would have to be tried in a Maryland court or out of state, leaving that for a Maryland judge to decide. Critics worried that the bill's ambiguity on that could force state residents or companies into costly long-distance legal battles.

Del. Robert E. Flanagan, a Howard County Republican, appealed in vain yesterday for lawmakers to pause to scrutinize a bill that many were voting for mainly on the recommendation of legislative leaders.

He contended that there is a "multitude" of disputes between software makers and users that could arise, including some not foreseen yet. The bill "may do more harm than good," he warned after its passage.

Only one other state, Virginia, has approved the bill, but delayed its imposition until 2001 to consider changing it.

"It'll be fine," assured Del. Kumar P. Barve, a Montgomery County Democrat who spearheaded House passage of the bill.

"People are going to wake up on Oct. 1 and discover that if their software doesn't work, they'll be the only people in America entitled to a refund," he said.

The bill provides for a legislative oversight committee to monitor the law when it takes effect Oct. 1 and to revise it if problems arise.

"We'll keep updating and correcting it as we need to," Taylor said. "But our underlying motive was to get started, to get out front and stay out front. This world is changing and we've got to keep up with it."

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