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Microsoft's Passport service: No Marylanders allowed?

Newsforge spots conflict of interest

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Passport is Microsoft's online wallet service, to which you're supposed to sign in once and shop online feeling all secure forever after.

Except, perhaps, in Maryland, where the local version of the UCITA law, which Microsoft itself worked to pass, conflicts with Passport's terms of use so heavily that Maryland residents are apparently not eligible to use Passport.

Passport's terms of use say, in small part:

This agreement is governed by the laws of the State of Washington, U.S.A. You hereby irrevocably consent to the exclusive jurisdiction and venue of courts in King County, Washington, U.S.A. in all disputes arising out of or relating to the use of the Passport Web Site or service. Use of the Passport Web Site and service is unauthorized in any jurisdiction that does not give effect to all provisions of these terms and conditions, including without limitation this paragraph.

(The above passage is under "general" in Passport's 2,212-word terms-of-use agreement, for those of you actually checking my accuracy.)

What's that mean? Basically, if you want to sue Microsoft because its self-proclaimed "powerful online security technology" allowed some script kiddie in a formerly communist country to access your credit card number, or Microsoft wants to sue you for misusing the service, you have to play ball on Microsoft's home turf. (You Passport fans in Australia or Luxembourg or south Florida, for that matter, may want to think about that scenario before you sign up.)

It also appears that Microsoft is attempting to bar residents of Maryland and, potentially, other states considering the Uniform Computer Information Transactions Act from using Passport with this sentence in the terms-of-use agreement: "Use of the Passport Web Site and service is unauthorized in any jurisdiction that does not give effect to all provisions of these terms and conditions, including without limitation this paragraph."

Maryland's much-maligned UCITA, which is slightly different from the version originally proposed, gives its state courts jurisdiction over software licensing issues for Maryland residents and companies. (Here's the text of Maryland's UCITA, but it's in rich text [rtf] format.)

Of course, UCITA also binds consumers to the software license agreements they sign, so it would seem that Maryland's UCITA would contradict itself in this case -- by giving Maryland courts jurisdiction over software disputes at the same time it ties the user to an agreement to use courts in King County, Wash.

Maryland Delegate Kumar Barve, a sponsor of UCITA and chairman of the House Subcommittee on Science and Technology, says Microsoft may be on the losing end in a fight between its terms of use and UCITA. When a state government creates consumer protection laws, that law trumps individual agreements such as Passport's. Maryland's UCITA doesn't change that practice of which state's law would be followed in such a case -- what it does affect is the venue.

So in the case of a Marylander suing Microsoft over Passport, a Maryland judge would decide where the case was tried. If Microsoft was a tiny little company that didn't have much of a business presence in Maryland, it might persuade a judge to allow it to defend itself back home in Redmond. But most judges, Barve says, are likely to decide that Microsoft does have a "significant business presence" in the state, and therefore, would likely make Microsoft's lawyers take the long airplane ride into BWI.

Of course, Microsoft could always challenge Maryland's UCITA. We wouldn't dare to encourage frivolous lawsuits, but it might be kind of fun to observe a slugfest between the boys from Redmond and the folks that brought us the distasteful UCITA -- including Microsoft itself.

© Newsforge.com. All rights reserved.

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