In the previous blog update (Part 1), I promised to continue decoding densely worded End User License Agreements (EULA). As discussed in the prior blog, the EULA is the agreement containing the terms the user of a software program agrees to abide by in using the software. In this blog, I address security. First, an excerpt from a standard form cloud services agreement:

“Company X shall notify Customer of any Unauthorized Access as soon as reasonably practical. In the event that any applicable law requires that any notice be given to Customer’s Service Users or clients, Company X acknowledges and agrees that Customer shall have control over the timing, content, and method of any required notification.”

Many companies
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The law of unintended consequences theorizes that the actions of people – especially government – often have effects that are surprising or unplanned. The idea of unintended consequences is generally traced back to English philosopher John Locke. In 1692, in a letter to Sir John Sommers, a member of England’s Parliament, Locke counseled the defeat of a parliamentary bill designed to regulate interest rates. Locke argued that instead of benefiting borrowers, as the bill intended, it would hurt them because creditors would find ways to circumvent the law, and those related costs would be borne by the borrowers, namely “widows, orphans and all those who have their estates in money.” John Locke, Some Considerations of the Consequences of the Lowering of Interest and the Raising the Value of Money (1691). Oregon House Bill 2661 (“HB 2661”) should be considered with unintended consequences in mind.

HB 2661’s goal is to curtail or reduce the spiraling costs of new residential construction in order to make housing more affordable. While that is an admirable and laudable goal, the key features of this bill remind me of Locke’s letter to Sommers and his concerns about that century’s old bill to regulate interest rates.

HB 2661’s key features include:


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The Oregon Court of Appeals recently issued a surprising decision regarding the ultimate timeline to file a construction defect claim involving a “spec home.” (A “spec home” is a house which a builder or developer constructs not for a specific owner but on speculation that the home will sell to the general public upon completion.)  In Shell v The Schollander Companies, Inc. (September 24, 2014), the Court of Appeals decided that ORS 12.115, as opposed to ORS 12.135, supplies the appropriate ten-year statute of repose for an owner seeking a negligent construction claim where the owner does not have a traditional “construction contract” with the builder.  The plaintiff in Shell was the original owner of the home.  She purchased the property midway through construction from the original developer/builder using a real estate sales agreement to complete the transaction.
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It is an all too familiar scenario: A condominium association (“COA”) sues a manufacturer of allegedly defective products used in the construction of the condominium. The COA alleges, among other claims, an Unlawful Trade Practices Act (“UTPA”) claim. The manufacturer–defendant seeks to dismiss the UTPA claim, arguing the UTPA, as a consumer protection statute, does not apply because neither the COA nor its members are “consumers” of the defective product, which was manufactured by the defendant, distributed by a third–party, and installed by a contractor. According to the manufacturer–defendant, this is a commercial transaction outside the UTPA. The COA argues its members are “consumers” because they purchased their units containing the defective product. Whether the UTPA requires plaintiffs to have some transactional relationship with the defendant to qualify as a “consumer” is currently unsettled in Oregon.
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