2018] THE TRADE SECRET-CONTRACT INTERFACE 1545
governing patents, copyrights, and trade secrets impose eligibility
requirements and limitations to balance the interests of intellectual property
owners against users, follow-on innovators who build on existing works, and
the public.1 These legislatively calibrated balances can be undermined when
firms employ contract terms to restrict information uses that intellectual
property laws permit.
The question of whether intellectual property laws are just default rules
that parties can contract around or fixed policy judgments has generated
significant scholarly debate.2 Much of it has analyzed (and criticized)
copyright owners’ imposition of non-negotiable licenses (e.g., “clickwraps”
and “shrinkwraps”) when selling access to mass-market software.3 These
pervasive licenses, which often condition user access on contract terms that
eliminate various limits built into copyright law (like fair use), threaten to
become a form of “privately legislated intellectual property.”4
1. See infra Part II.C.
2. See, e.g., Jonathan M. Barnett, Why is Everyone Afraid of IP Licensing?, 30 HARV. J.L. & TECH.
123, 124–25 (2017); Mark A. Lemley, Beyond Preemption: The Law and Policy of Intellectual Property
Licensing, 87 CALIF. L. REV. 111, 118–33 (1999); J.H. Reichman & Jonathan A. Franklin, Privately
Legislated Intellectual Property Rights: Reconciling Freedom of Contact with Public Good Uses of Information,
147 U. PA. L. REV. 875, 876–83 (1999).
3. Such licenses come in various forms, including “shrinkwrap” licenses, which are
wrapped in plastic and accompany software, “clickwrap” licenses, which are electronically
transmitted and require a party to click “I agree” before downloading software or accessing a site,
and “browsewrap” licenses, which condition use of a website on terms that are typically accessed
via hyperlink. Collectively, these types of restrictive agreements have been ref erred to as “terms
impact of such adhesive consumer licenses on policy concerns underlying intellectual property
laws. See generally Julie E. Cohen, Copyright and the Jurisprudence of Self-Help, 13 BERKELEY TECH. L.J.
1089 (1998); Niva Elkin-Koren, Copyright Policy and the Limits of Freedom of Contract, 12 BERKELEY
TECH. L.J. 93 (1997); Mark A. Lemley, Intellectual Property and Shrinkwrap Licenses, 68 S. CAL. L.
REV. 1239 (1995) [hereinafter Lemley, Intellectual Property]; Maureen A. O’Rourke, Drawing the
Boundary Between Copyright and Contract: Copyright Preemption of Software License Te rms, 45 DUKE L.J.
479 (1995). In addition, a voluminous body of contract law scholarship critiques adhesive
consumer licenses, focusing less on their threat to underlying IP policies and more on their
broader threat to traditional notions of assent and salience that undergird and legitimize private
contracting. See generally N
ANCY S. KIM, WRAP CONTRAC TS: FOUNDATIONS AND RAMIFICATIONS
(2013); MARGARET JANE RADIN, BOILERPLATE: THE FINE PRINT, VANISHING RIGHTS, AND THE RULE
OF LAW (2012); James Gibson, Boilerplate’s False Dichotomy, 106 GEO. L.J. 249 (2018).
4. Reichman & Franklin, supra note 2, at 882. Intellectual property law scholars have also
raised concerns about copyright and patent owners’ use of contract law to evade the first-sale or
exhaustion limitation that applies to sales of informational goods. See Ariel Katz, The First Sale
Doctrine and the Economics of Post-Sale Restraints, 2014 BYU L. REV. 55, 141 (suggesting that IP
owners’ ability to contract around the first sale doctrine should be permitted only in “limited
circumstances”); Aaron Perzanowski & Jason Schultz, Digital Exhaustion, 58 UCLA L. REV. 889,
892 (2011) (describing “first sale’s practical benefits and the problem of its increasing
marginalization”); Guy A. Rub, Rebalancing Copyright Exhaustion, 64 EMORY L.J. 741, 748–49
(2015) (arguing for certain restrictions on copyright owners’ ability to contract around the