LIBLICENSE Model License Agreement

Commentary

License Provisions

NISO’s SERU: Shared Electronic Resource Understanding

Scenarios

Works Consulted

Authors

LIBLICENSE Model License Agreement

LIBLICENSE: Licensing Digital Contents – a Resource for Librarians, liblicense.crl.edu

LIBLICENSE Model License Agreement (LIBLICENSE) with Commentary, LIBLICENSE.crl.edu/wp-content/uploads/2015/05/modellicensenew2014revmay2015.pdf

Commentary

Introduction

A license is one form of a contract. This chapter provides an overview of general licensing practices between libraries and content providers of electronic resources, commonly-used provisions in those licenses, with sample clauses from the LIBLICENSE Model License Agreement (LIBLICENSE), followed by a brief discussion of NISO’s SERU: A Shared Electronic Resource Understanding. For broader coverage of basic contract law and different forms of contracts, please refer to the Contract Law Basics chapter in this textbook at mlpp.pressbooks.pub/librarylaw/chapter/contract-law-basics/.

The information contained in this chapter is not legal advice and is provided solely to introduce library, archives, and information science students to legal concepts in licensing.

Licensing Practices

Licenses for e-resources, negotiated with content providers, spell out what materials the library is permitted to use, how the materials may be used and by whom, the cost, the duration of the license and how it may be terminated or renewed, and what rights, if any, the library has to use the materials after the license has been terminated.

It is good practice to read the license with a checklist of standard license provisions that you or your institution require. Read the license to find each provision and analyze the provision based on your library’s needs and what the salesperson has promised you. If your library or archives is part of an institution with its own counsel, let your counsel know of any problematic provisions.

You, or your counsel, would then ask the vendor for changes to any provisions that do not meet your library’s needs (use Microsoft Word’s “Track Changes” feature to make changes directly to the license). Your general counsel may also require specific language for certain clauses, so consult with them in advance.

Model licenses exist to help ease the burden of licensing. A model license can be used to learn from, copy language, and reference when working with vendors. The Big Ten Academic Alliance, California Digital Libraries (University of California), and the Greater Western Library Alliance (GWLA) have their own model licenses; and there are many others. LIBLICENSE, from where we have pulled our sample language, is a popular model license hosted by the Center for Research Libraries.

License Provisions

1. Authorized Users

The authorized user clause defines who can use licensed content, an important component to any contract. LIBLICENSE recommends that each institution create their own custom clause for this section. It may be easier, for consistency’s sake, to replace the vendor’s definition of authorized user with your institutional definition. Vendors often agree to change this term unless the suggestion deviates significantly or adds a new user group. You may need to explain which users are included in a particular user group. Alumni are often excluded from the list of authorized users, but are, surprisingly, included for some vendors.

If you want or need access for walk-in users (community members not affiliated with the licensee, who can only access licensed content while physically present on your site) then they should be included in the authorized user definition. Public libraries and academic institutions often require access for walk-ins and consider exclusion of walk-ins a deal-breaker. The biggest pushback for allowing walk-ins to access content comes from, in our experience, for business and medical resources. Recent COVID-19 related closures illustrated the problem with only allowing walk-ins access when physically present in a Licensee’s site. Consider negotiating future clauses to allow walk-ins access licensed content when they are on-site, but not necessarily inside specific buildings.

Authorized Users. The Licensor and Licensee define “Authorized Users” as the following:

1. The Licensee’s full-time and part-time students, regardless of their physical location;

2. The Licensee’s full-time and part-time employees (including faculty, staff, affiliated researchers, and independent contractors), regardless of their physical location;

3. Other valid ID holders; and

4. Patrons not affiliated with Licensee, who are physically present at Licensee’s site(s) (“Walk-ins”) (LIBLICENSE 5).

2a. Authorized Uses

Ensure the authorized use allowances align with your user expectations, values, and norms of content use. LIBLICENSE authorized use model language spans more than two pages, covering basic usage rights and uses for interlibrary loan, course reserves, course packs, electronic linking, education, teaching, and research, scholarly sharing and citation, bibliographic citations, text and data mining, caching, and backup copies. The authors recommend reviewing this section of LIBLICENSE for example text that suits your needs. See also provision 7. Interlibrary Loan below.

At a minimum, all licenses should allow for basic uses such as viewing, downloading, copying and printing. Ensure these uses are allowed in each license.The LIBLICENSE model language for basic use rights is:

Usage Rights. Licensee and Authorized Users may electronically display, download, digitally copy, and print a reasonable portion of the Licensed Materials. Licensee may charge a reasonable fee to recover costs of copying or printing portions of Licensed Materials for Authorized Users”(LIBLICENSE 5).

Additionally, each license should include a clause that does not diminish the fair use rights allowed under copyright law. The LIBLICENSE clause is:

“No Diminution of Rights. Nothing in this Agreement, including but not limited to Section 3.2, shall be interpreted to diminish the rights and privileges of the Licensee or Authorized Users with respect to any of the Licensed Materials, including exceptions or limitations to the exclusive rights of copyright owners, such as fair use, under Section 107 of the U.S. Copyright Act. In the event that any content included in the Licensed Materials is in the public domain or has been issued under a Creative Commons or other open license, Licensor shall not place access, use or other restrictions on that content beyond those found in the open license, where applicable” (LIBLICENSE 7).

2b. Restricted Uses

Most licenses contain a short, but specific list of restrictions. If any of the allowed uses listed above are strictly prohibited you will often see those restrictions listed in this section as well. Except as allowed elsewhere, publishers generally want to restrict use by unauthorized users, modification of their licensed materials, removal of copyright/trademark notices, and use for commercial purposes. These prohibitions are meant to protect their owned or leased intellectual property and future revenue. LIBLICENSE lists these acceptable restrictions:

4.3 Restrictions. Licensor and Licensee agree to the following use and access restrictions on the Licensed Materials.

1. Unauthorized Use. Except as specifically provided elsewhere in this Agreement, Licensee shall not knowingly or intentionally permit anyone other than Authorized Users to use the Licensed Materials.

2. Modification of Licensed Materials. Licensee shall not modify or create a derivative work of the Licensed Materials without the Licensor’s express, prior, and written permission, unless the Licensed Materials have been made available under an open license that allows modification and creation of derivative works, are in the public domain, or as provided for elsewhere in this Agreement.

3. Removal of Copyright or Trademark Notice. Licensee may not remove, obscure or modify any valid copyright or trademark notices included in the Licensed Materials.

4. Commercial Purposes. Other than as specifically permitted in this Agreement, Licensee may not use the Licensed Materials for commercial purposes. This restriction expressly prohibits the Licensee from selling Licensed Materials. For the avoidance of doubt, research conducted by Licensee and Authorized Users that is supported by a commercial entity shall not be considered use for commercial purposes (LIBLICENSE 7).

Further restrictions that may make content less valuable or useful to your institution or authorized users can be negotiated. Explain the use case or expected norms when articulating the rationale for eliminating or reducing some restrictions.

3. Performance Obligations

The performance obligation clauses define the parties’ responsibilities relating to Authorized Users. Although these clauses spell out the reasonable efforts the licensee should take relating to users, the clauses should not go so far as to confer liability on the library for users’ misuse of the licensed materials. See also section 13. Indemnification below.

In LIBLICENSE’s recommended language (see 5.2 and 5.3 below), the licensee “will use reasonable efforts” to provide users with information on the terms and conditions of use of the licensed material and to restrict access only to Authorized Users. If the license includes wording indicating that the licensee “ensures” or “guarantees” that only Authorized Users will access the materials or that the licensee is “liable” for users’ actions, the library should ask that the wording be stricken from the license and replaced with “shall take reasonable efforts” language.

In LIBLICENSE, the section 5.2 Licensee Performance Obligations describes the library’s performance standards:

5.2 Licensee Performance Obligations. The Licensee agrees to the following performance standards.

1. License Terms Notice. Licensee will use reasonable efforts to provide Authorized Users with appropriate notice of the terms and conditions under which access to the Licensed Materials is granted under this Agreement.

2. Protection from Unauthorized Use. Licensee will use reasonable efforts to restrict access to the Licensed Materials to Authorized Users.

3. Maintaining Confidentiality of Access Passwords. Where access to the Licensed Materials is to be controlled by use of passwords, Licensee will use reasonable efforts to inform Authorized Users that they should not divulge their numbers and passwords to any third party. Licensee will also use reasonable efforts to maintain the confidentiality of any institutional passwords provided by Licensor” (LIBLICENSE 12).

Section 5.3 Mutual Performance Obligations describes performance standards for both parties:

5.3. Mutual Performance Obligations. In addition to their respective, specific performance obligations, the Licensor and Licensee agree to be bound by the following performance standards.

Notification of Unauthorized Use. In the event the Licensee has notice of an unauthorized use of the Licensed Materials and cannot promptly remedy it, the Licensee shall immediately notify the Licensor.

In the event the Licensor has notice of unauthorized use of the Licensed Materials, the Licensor will immediately notify Licensee, and Licensee will cooperate with the Licensor to address the unauthorized use and avoid a recurrence.

Any unauthorized use that is considered a breach of obligations under this Agreement shall be subject to Section 6.4, below, including the cure period” (LIBLICENSE 12-13).

Note that, even with “reasonable efforts” language, the licensee is not completely free of liability for unauthorized use of the materials. For example, if library employees intentionally assist or encourage unauthorized use, the licensor may have grounds to terminate the license for material breach. See also section 9. Termination below.

Another access concern is compliance with the Americans with Disabilities Act (ADA). The model license suggests including a provision on Disabilities Compliance, as follows:

“e. Disabilities Compliance. Licensor shall comply with the Americans with Disabilities Act (ADA), by supporting assistive software or devices such as large print interfaces, text-to-speech output, voice-activated input, refreshable braille displays, and alternate keyboard or pointer interfaces, in a manner consistent with the Web Accessibility Initiative Web Content Accessibility Guidelines (www.w3.org/WAI/guid-tech.html). Licensor shall provide to Licensee a current completed Voluntary Product Accessibility Template (VPAT) (go.usa.gov/UjFA). to demonstrate compliance with the federal Section 508 standards. If the product does not comply, the Licensee has the right to adapt the Licensed Materials in order to comply with federal and state law” (LIBLICENSE 8).

4. Methods of Access

The license should indicate the methods by which users can access the licensed materials. Alford notes that the “mode of access to the electronic materials is closely related to the definition of users and should be carefully considered prior to entering into an electronic licensing agreement” (Alford 636).

Is access through standard web browsers or will users need to download additional software? Can users access both in the library and remotely? What are the methods of authentication? The LIBLICENSE editors note that “access and authentication specifications may require the expertise of networking professionals, information security specialists, and/or the institution’s chief information officer” (LIBLICENSE, p. 6, 22). For example, a high school media center library might be restricted from downloading certain software on school computers.

LIBLICENSE covers methods of access in section 4.2 Access and Authentication:

4.2 Access and Authentication. Licensor will provide the Licensee and its Authorized Users with access to the Licensed Materials pursuant to the terms, conditions, and specifications set forth in Schedule 3, which is attached hereto. Licensor will use reasonable efforts to provide authentication methods that conform to current industry standards, and will cooperate with Licensee in the implementation of new authentication protocols and procedures as they are developed during the term of this Agreement” (LIBLICENSE 6).

The LIBLICENSE editors suggest that these issues be addressed in a separate schedule, because authentication specifications vary widely (see LIBLICENSE sample schedule below). Some of the many options include: IP addresses (including geolocation), proxy servers, passwords, public keys or certificates, Shibboleth, and developing protocols not yet tested at the time the license agreement is signed (LIBLICENSE 6, 22).

5. Product and Price

Clearly state in the license what specific materials/products are covered and the cost. This information on product and price can be included in the main body of the license agreement, in attached schedules, or on an annual order form or addendum with the original license agreement incorporated as an attachment. For example, if an ebook vendor sells ebook collections by subject and year, the library would negotiate terms and condition of the license for the first year, but in subsequent years the library would sign an order form or addendum agreeing to purchase new collections at specific prices under the terms of the original license.

The products should be clearly described, either by database or collection name and description or by listing individual journal or ebook titles. The LIBLICENSE editors recommend that “particular attention be given to clarifying content for which perpetual rights are granted and content that is made accessible during the term of the agreement, but for which no perpetual rights are included” (LIBLICENSE 18). See also 6. Duration of Access to Licensed Materials and Renewals below.

The price should also be clearly stated. Because vendors of electronic resources employ a wide variety of pricing models, some of which are complex and confusing, this may be easier said than done. The LIBLICENSE editors recommend that “both the applicable price and the basis on which the pricing is developed be described in this schedule. Pricing models vary widely and continue to evolve, including fees based on the number of Authorized Users or geographic Sites, periodic subscription fees or one-time purchase fees with or without annual maintenance charges, etc. Additionally, the payment term may be for less than one year, one calendar year, one fiscal year (typically July 1 through June 30) or for multiple years” (LIBLICENSE 20).

As a practical matter, library staff reviewing licenses need to determine whether the description of products, prices, and duration of access match the assurances made by the vendor representative. For example, if the vendor representative promised a “bonus” if the license is signed before September 1 (for example, three extra months of access or ten percent off the list price), the “bonus” details are only guaranteed if spelled out in the agreement. See also 15. Entire Agreement below.

6. Duration of Access to Licensed Materials and Renewals

If a license agreement does not permit use of the licensed materials after termination of the license, the library may not be able to continue its use of previously-licensed materials. Licenses for electronic resources should clearly specify the period of time that the library (the licensee) will have access to the licensed materials. Some electronic resources are licensed for a limited term and others may be licensed for perpetual access with archival rights.

For example, a full-text database may be licensed for a one year term, with the option of renewing for additional years. If the library does not renew, all access to the database terminates at the end of the license term. LIBLICENSE provides a sample limited term in section 1.1 Agreement Term:

6.1 Agreement Term. This Agreement shall be in effect from the Effective Date until [enter specific time and time zone] on [enter date] (LIBLICENSE 13).

On the other hand, if a license provides perpetual access to a year of an ejournal, or a multi-year backfile of ejournals, access to the licensed years should not terminate if the library does not continue the subscription for future years. Some licenses may require payment of an access fee for continued use of the provider’s platform if the library ceases to subscribe to any of the provider’s ejournals. Some licenses provide for an archival file to be sent to the licensee on request and/or permit the licensee to use a third-party archiving system (e.g., LOCKSS, Portico, or other similar system) to archive and restore ejournal content.

Note that “archiving” refers to the licensee’s right to obtain and store a copy for future access. “Perpetual” access refers to the licensee’s ability to access licensed content that the licensee paid for, even if the licensee is no longer subscribing to current content.

The model license covers perpetual access and archiving in sections 8.1, 8.2, and 8.3:

8.1 Perpetual License. Notwithstanding anything else in the Agreement, Licensor grants to Licensee a nonexclusive, royalty-free, perpetual license to use any Licensed Materials that were [accessible or subscribed to] during the term of this Agreement. Such use shall be in accordance with the provisions of this Agreement, which provisions shall survive any termination of this Agreement. The means by which Licensee shall have access to such Licensed Materials shall be in a manner and form substantially equivalent to the means by which access is provided under this Agreement. If the Licensor’s means of access is not available, the Licensee may provide substantially equivalent access to the Licensed Materials in accordance with Sections 8.2 and 8.3, below (LIBLICENSE 14).

8.2 Archival Copy. Licensor shall provide to Licensee upon request, or Licensee may create, one (1) copy of the entire set of Licensed Materials to be maintained as an archival copy. The archival copy from the Licensor shall be provided without any DRM in a mutually agreeable medium suitable to the content, and any fees for provision of copies will be on a time and materials basis only.

In the event the Licensor discontinues or suspends selling or licensing the Licensed Materials, the Licensee may use such archived Licensed Materials under the same terms as this Agreement. If Licensee has a backup copy of the Licensed Materials as defined in Section 3.2(l) Backup Copy, the backup copy may be used as an archival copy (LIBLICENSE 14).

8.3 Third Party Archiving Services. Licensor and Licensee acknowledge that either party may engage the services of third-party trusted archives and/or participate in collaborative archiving endeavors to exercise Licensee’s rights under this section of the Agreement. Licensor agrees to cooperate with such archiving entities and/or initiatives as reasonably necessary to make the Licensed Materials available for archiving purposes. Licensee may perpetually use a third-party trusted system or collaborative archive to access or store the Licensed Materials, so long as Licensee’s use is under the same terms as this Agreement.

In the event the Licensor discontinues or changes the terms of its participation in a third-party archiving service, the Licensor shall notify the Licensee in advance, and shall in good faith seek to establish alternative arrangements for trusted archiving and perpetual access to the Licensed Materials (LIBLICENSE 14-15).

The license should also specify how renewals are handled, including the time period for giving notice of cancellation, time period for vendors to give notice of price increase, and whether the renewals are automatic or require written consent of the licensee. “Evergreen clauses”, or automatic renewal clauses, should always be changed, even if your institution allows for them. Sample language might look like: “This Agreement may be renewed for a successive one (1) year term with mutual consent of both parties.”

7. Interlibrary Loan

Resource sharing, such as interlibrary lending (ILL), is a foundational and fundamental role for libraries. For a detailed discussion of ILL, see the Copyright and Resource Sharing chapter in the first section of this textbook at: mlpp.pressbooks.pub/librarylaw/chapter/copyright-ill/ .

An ILL clause should allow the sharing of electronic copies to other libraries (regardless of geographical location), as allowed under copyright law. Experienced licensors have seen many variations of this clause, but the simplest and least restrictive language is preferred, such as:

Licensee may fulfill requests from other libraries, a practice commonly called Interlibrary Loan. Licensee agrees to fulfill such requests in accordance with Sections 107 and 108 of the U.S. Copyright Act. Requests may be fulfilled using electronic, paper, or intermediated means (LIBLICENSE 5).

Variations of this clause often intend to restrict or curb ILL activity. The authors recommend determining your preferred ILL model language and replacing all ILL language with your own language. This provides continuity and ensures ILL rights as allowed under copyright.

To explicitly allow for the lending of whole ebooks append additional language, such as:

Electronic books are among the Licensed Materials governed by this provision, and regardless of statutory provisions or interpretation, Licensor agrees that requests for whole ebooks may be fulfilled by Licensee.

8. Class Use

Content purchased by academic libraries must allow for course use (there are very few exceptions to this). A license that allows for “educational use”, or is silent on these uses will suffice. Watch, though, for clauses that restrict or curb classroom use or teaching efforts. Asking to change restrictive language is time consuming, but worth the effort. LIBLICENSE language suggests the following in section 3.2:

1. Course Reserves. Licensee and Authorized Users may use the Licensed Materials for print and electronic reserve readings in connection with specific courses of instruction offered by Licensee.
2. Coursepacks. Licensee and Authorized Users may use a reasonable portion of the Licensed Materials in the preparation of coursepacks or other educational materials.
3. Electronic Links. Licensee and Authorized Users may provide hyperlinks from the Licensee’s and Authorized Users’ web page(s) or web site(s) to individual units of content within the Licensed Materials (LIBLICENSE 4).

MOOCs, or massive open online courses, may be offered to individuals not normally included in the definition of “authorized users” by library licenses. It can come as a great surprise to instructors of those courses when they cannot use library content for these courses.

For further discussion of class use and course reserves, see the Copyright and Libraries: Georgia State Copyright Lawsuit chapter at mlpp.pressbooks.pub/librarylaw/chapter/copyright-library-reserves/ and the Copyright and Education chapter at mlpp.pressbooks.pub/librarylaw/chapter/copyright-education/ in this textbook.i

9. Termination of the License

The license should provide a process for termination of the license, including reasons for termination and refunds (if any). In the LIBLICENSE sample clauses below, there are provisions for termination because of financial hardship and for material breach.

Multi-year licenses should always contain a financial hardship clause to allow libraries to terminate agreements when funding is no longer available in subsequent years of the agreement.Vendors vying for multi-year licenses are often willing to agree to a financial hardship provision rather than lose a lucrative purchase. LIBLICENSE covers financial hardship in section 6.3 Early Termination for Financial Hardship:

6.3 Early Termination for Financial Hardship. The Licensee may terminate this Agreement without penalty if sufficient content acquisitions funds are not allocated to enable the Licensee, in the exercise of its reasonable administrative discretion, to continue this Agreement. In the event of such financial circumstances, Licensee agrees to notify Licensor of the intent to terminate the Agreement as soon as is reasonably possible, but in any case, no less than [enter a mutually agreeable number of days] prior to next payment date (LIBLICENSE 13).

The license should also include a provision for termination for material breach. A “material breach” is when one of the parties does something, or fails to do something, that defeats the heart of the agreement between the two parties. [Stim, pp. 65-69] For example, if the licensee fails to pay the license fee, the licensor may terminate the license and terminate access to the licensed materials. Or, if the licensee’s use of the licensor’s materials is not a use permitted by the license, the licensor may terminate the license if the use constitutes a material breach. Other examples of material breach include the licensor’s failure to provide reliable online access to the licensee’s users or the licensor’s loss of the right to license the materials.

The termination clause should also include a reasonable time period for the breaching party to cure the breach. Alford notes, “A large organization, either the library or the publisher, may inadvertently cause a technical default; therefore, written notice and a reasonable opportunity to cure any default should be allowed by the terms of the contract” (Alford 639).

The model license addresses termination for material breach in section 6.4:

6.4 Termination for Breach. If either party believes that the other has materially breached any obligations under this Agreement, such party shall notify the other party of the alleged breach in writing following the notice provisions in Section 10.8.

If a material breach has occurred, the breaching party shall have [thirty (30) days] from the receipt of notice to use all reasonable means to cure the alleged breach and to notify the non-breaching party in writing that cure has been effected. If the breach is not cured within [thirty (30) days], the non-breaching party shall have the right to terminate the Agreement without further notice. Once this Agreement ends, by early termination or otherwise, the Licensor may terminate (or cause termination of) access to the Licensed Materials by Licensee and Authorized Users subject to Section 8, below. In addition, authorized copies of Licensed Materials made by Authorized Users may be retained for educational purposes and used subject to the terms of this Agreement (LIBLICENSE 13).

The LIBLICENSE Refunds clause (6.5 below) provides for a pro-rata refund to the licensee (except for material breach by the licensee, in which case the licensee would lose both access to the licensed materials and money the licensee paid to license the materials). Some libraries may opt to negotiate for credit from the vendor rather than a monetary refund.

6.5 Refunds. In the event of early termination, except for termination for a material breach by the Licensee, Licensee shall be entitled to a refund of any fees or pro-rata portion thereof paid by Licensee for any remaining period of the Agreement (LIBLICENSE 14).

10. Governing Law and Venue

The Governing Law and Venue clause sets forth the choice of law and choice of forum to be used in case of a dispute. Choice of law indicates which state’s law will govern the license. Choice of forum identifies the specific court (state and federal) for adjudication of disputes (Lipinski 458-459, 471-472).

Section 10.2 of the model license sets out a sample provision for governing law and venue:

10.2 Governing Law. This Agreement shall be interpreted and construed according to, and governed by, the laws of [enter venue convenient to Licensor and Licensee], without regard to its conflict of laws rules. The federal or state courts located in [enter venue convenient to Licensor and Licensee] shall have jurisdiction to hear any dispute under this Agreement (LIBLICENSE 16).

Because a vendor’s standard license often specifies the vendor’s home state/country for choice of law and venue, libraries should ask that the clause be revised to reflect their own state’s laws and local courts. In fact, many state institutions such as universities and state libraries are prohibited from agreeing to license terms that provide for out-of-state governing law and venue (Lipinski 471; Alford 639).

Some vendors will not agree to changing the governing law and venue clause to the library’s home state but will agree to deleting the clause entirely and to remain silent on choice of law and forum. Alford states, “While the deletion does not resolve the issue, it does postpone the ‘battle’ of what law governs” (Alford 640) and lets the courts decide.

11. Usage Statistics

All vendors should provide usage statistics to help libraries gauge use of the product, preferably in a COUNTER-compliant format (COUNTER is a code of practice for consistent vendor-supplied usage statistics). Many vendors provide usage statistics without a specific license clause, but it’s good to establish expectations by putting language in every license.

Licensor shall provide to Licensee monthly usage statistics for the Licensed Materials. Statistics shall meet or exceed the most recent project Counting Online Usage of NeTworked Electronic Resources (COUNTER) Code of Practice Release, including but not limited to its provisions on customer confidentiality. When a release of a new COUNTER Codes of Practice is issued, Licensor shall comply with the implementation time frame specified by COUNTER to provide use statistics in the new standard format (LIBLICENSE 13).

The above sample language is specific to COUNTER, so the language should be modified and the vendor does not offer COUNTER compliant usage statistics.

12. Warranties and Disclaimers

A warranty is a guarantee or promise that something is true (Stim, p. 476). In the case of electronic resources licenses, warranties are usually limited to guarantees that the vendor has the legal authority to license the materials. See LIBLICENSE sample clause 9.1 below. Licensors are not likely to provide warranties to guarantee reliable online access to the products, nor do they warrant the content of the databases (Alford 641).

9.1 Warranties. The Licensor warrants it has all necessary legal and equitable rights, permissions, and clearances to license the Licensed Materials to the Licensee for the purposes outlined in this Agreement, and that use of the Licensed Materials by Authorized Users in accordance with the terms of this Agreement shall not infringe the copyright or other rights of any third party. Licensor shall indemnify and hold harmless the Licensee and any Authorized Users for any losses, claims, damages, awards, penalties, or injuries they incur (including reasonable attorney’s fees) which arise from any third party claim that alleges contract breach, copyright infringement, or other intellectual property infringement arising from the Licensee’s or an Authorized User’s use of or access to the Licensed Materials in accordance with the terms of this Agreement. Additionally, Licensor agrees that no liability limitation that may appear elsewhere in this Agreement applies to, overrides, or cancels this indemnification. Licensor warrants that any physical object or medium that contains the Licensed Materials will be free from defects for a period of [enter time period] from delivery (LIBLICENSE 15).

Disclaimers are used to distance licensors from legal obligations (Stim 143). The warranty section of an electronic resources license will usually include disclaimers relating to the content and the product itself, disclaiming “warranties of quality, performance, merchantability, or fitness for a particular purpose” (LIBLICENSE 15). See model license section 9.2 Warranty Disclaimers below. “Merchantability” in legal terms means “that a good sold carries with it an inherent soundness which makes that good suitable for the purpose for which it was designed.” Agri-Business Supply Co. v. Hodge, 447 So.2d 769 (Ala. Civ. App. 1984) (cited by Lipinski 507).

9.2 Warranty Disclaimers. Notwithstanding anything else in this Agreement, neither party shall be liable for any indirect, special, incidental, punitive, or consequential damages, including loss of data, business interruption, or loss of profits that arises from the use of the Licensed Materials, or inability to use the Licensed Materials. Except for the express warranties stated elsewhere in this Agreement, Licensor disclaims any and all other warranties, conditions, or representations (express, implied, oral, or written), relating to the Licensed Materials or any part thereof, including, without limitation, any and all implied warranties of quality, performance, merchantability, or fitness for a particular purpose (LIBLICENSE 15).

In a nutshell, licensors guarantee only that they have the right to license their products. By disclaiming “quality, performance, merchantability, or fitness for a particular purpose,” they are basically saying that they do not guarantee that the product is good for any purpose. Lipinski notes, “The licensor may describe what is in the database, as it would be an odd way to do business if no information was forthcoming, but the licensor does not want any legal liability with respect to those representations” (Lipinski 445).

13. Indemnification

Indemnification is a “hold harmless” clause where one party agrees to defend the other party against legal claims arising from the license agreement. Indemnity is used to limit one party’s risks by shifting the risks to the other party (Stim 202).

Libraries should not agree to an indemnification clause that requires the library to indemnify the vendor (Alford 637; Lipinski 464). The library may, however, agree to take reasonable efforts to correct or prevent misuse by library users. See 3. Library’s Responsibility for Users above.

The license should include an indemnities clause where the licensor indemnifies the library against claims arising from the license agreement, including losses, claims, damages, awards, penalties, injuries, and attorneys fees (see LIBLICENSE sample section 9.3 below). This clause can protect the library against legal claims that arise from actions within the licensor’s control. For example, licensors may represent that they have the legal authority to include copyrighted materials in the licensed database. If the owners of the copyrighted materials sue claiming infringement, the licensor is obligated to defend against the claims (Lipinski 465-466).

9.3 Indemnities. Licensor shall indemnify and hold harmless the Licensee for any losses, claims, damages, awards, penalties, or injuries (including reasonable attorneys fees) that arise from any alleged breach of the Licensor’s representations and warranties made under this Agreement. This indemnity shall survive the termination of this Agreement (LIBLICENSE 15).

14. Force majeure

Force majeure is French for “superior force” and in law means “an event or effect that cannot be reasonably anticipated or controlled.” These events are sometimes referenced as “acts of God.” Natural disasters, war, and pandemics are all examples of a force majeure. The clause should be mutually agreeable for both parties.

Neither party shall be liable in damages or have the right to terminate this Agreement for any delay or default in performing hereunder if such delay or default is caused by conditions beyond its control, including Acts of God, Government restrictions (including the denial or cancellation of any export or other necessary license), wars, insurrections, labor strikes, and/or any other cause beyond the reasonable control of the party whose performance is affected (LIBLICENSE 18).

The purpose of a force majeure provision is to relieve a party from contractual obligations in circumstances that are beyond their control. Without such a clause these events are not covered by the license.

15. “Entire agreement” clause

An “entire agreement” clause ensures only the words contained inside the four corners of the document constitute the entire agreement. If included in the contract, nothing discussed or agreed to prior to signing is valid. The last sentence in the sample language refers to a clause that ensures the negotiated agreement prevails over any online terms and conditions (also known as “clickthrough agreements” where authorized users agree to either explicitly or implicitly when using a product).

This Agreement constitutes the entire agreement of the parties and supersedes all prior communications, understandings, and agreements relating to the subject matter hereof, whether oral or written. For the avoidance of doubt, online terms and conditions as defined in Section 5.1(d) Online Terms and Conditions shall not modify the terms of this Agreement (LIBLICENSE 18).

If a vendor or representative has made certain promises during negotiation (whether via email or orally), make sure those promises are included in the contract. The old adage “get it in writing” is appropriate here.

16. Confidentiality

The license should include a provision indicating that the licensor will keep personally-identifiable patron data confidential. In the model license sample clause 5.1.r below, the licensor agrees not to share personally-identifiable user information unless compelled by law. Licensor agrees to notify the licensee if served with a court or if their systems are breached and confidentiality is compromised (LIBLICENSE 11).

5.1 Licensor Performance Obligations. The Licensor will use reasonable efforts to ensure that its performance will meet or exceed industry standards and practices. Additionally, the Licensor agrees to the following performance standards.

1. Confidentiality of Personally Identifiable Information. The Licensor agrees that no personally identifiable information, including but not limited to log-ins recorded in system logs, IP addresses of patrons accessing the system, saved searches, usernames and passwords, will be shared with third parties, except in response to a subpoena, court order, or other legal requirement. If Licensor is compelled by law or court order to disclose personally identifiable information of Authorized Users or patterns of use, Licensor shall provide the Licensee with adequate prior written notice as soon as is practicable, so that Licensee or Authorized Users may seek protective orders or other remedies. Licensor will notify Licensee and Authorized Users as soon as is practicable if the Licensor’s systems are breached and the confidentiality of personally identifiable information is compromised (LIBLICENSE 7, 11).

The licensor may ask the library to agree to confidentiality provisions, such as LIBLICENSE’s 5.2.c. Maintaining Confidentiality of Access Passwords below (LIBLICENSE 12). The licensor might also request that the library agree to additional nondisclosure provisions relating to price, license terms, or proprietary information (Lipinski 425, 479). Note that, if the library’s governing board or parent institution is subject to a Freedom of Information Act, the library might not legally be able to agree to maintain confidentiality of price or other license terms.

5.2 Licensee Performance Obligations. The Licensee agrees to the following performance standards.

“c. Maintaining Confidentiality of Access Passwords. Where access to the Licensed Materials is to be controlled by use of passwords, Licensee will use reasonable efforts to inform Authorized Users that they should not divulge their numbers and passwords to any third party. Licensee will also use reasonable efforts to maintain the confidentiality of any institutional passwords provided by Licensor (LIBLICENSE 12).

NISO’s SERU: Shared Electronic Resource Understanding

Licenses take a long time to negotiate, for both parties. The National Information Standards Organization’s (NISO) Shared Electronic Resource Understanding (SERU), created in 2008, is a mutually agreeable alternative to a fully negotiated license. SERU was created by a group of publishers and librarians, to decrease negotiation time spent and quickly come to an understanding of commonly accepted e-resource license terms. A survey of academic library license negotiators revealed it can take 24.4 days to successfully negotiate a license or amendment but only 5.4 days to agree to use SERU (Carter 189-190).

The NISO SERU Registry (https://sites.google.com/niso.org/registry-seru/) lists the libraries, consortia and publishers interested in using SERU. Updated in 2012, SERU “understandings” cover authorized use and users, inappropriate use, confidentiality and privacy, online performance and service provisions, perpetual and archival rights, and more.

Investigating SERU as a replacement for a license is well worth the time it takes to check the NISO SERU Registry. While not intended for high-cost or -stakes transactions, SERU can substitute for a license in many situations. Keep in mind SERU is not a contract, but a mutual understanding (a formalized handshake with defined understandings, but not usually written to be legally enforced).

Scenarios

Scenario 1

Your public library has licensed a genealogy database with access limited to your cardholders. Library patrons can access at computers in the library or through remote access via standard web browsers by typing in their library card and pin numbers. One of your library patrons shares their card and pin number on an international genealogy listserv, and genealogists around the globe begin to access the database through your library’s login. The vendor notices the increased usage and terminates your library’s access to the database. The vendor notifies you of the termination and offers to reinstate your library’s access to the database but only for in-library use access (at the same price your library paid for in-library and remote access). What are your options?

Scenario 2

You are the electronic resources librarian at a college library. In August, a vendor offers you a price for a full-text academic database subscription for the following calendar year, January to December, and tells you that, if you sign the license agreement by August 31, the vendor will open up access to the database on September 1 and give you an additional four months of free access. When you review the license agreement, there is no mention of access beginning on September 1. When you question this, the salesperson sends you an email telling you not to worry about the omission and that access will be turned on September 1, regardless of what the license says. What do you need to take into consideration before signing the license?

Works Consulted

Alford, Duncan E. “Negotiating and Analyzing Electronic License Agreements.” Law Library Journal, Vol. 94, No. 4, 2002, pp. 621-644.

Big Ten Academic Alliance. “Consortial Licensing: Standardized Agreement Language,” www.btaa.org/library/licensing/standardized-agreement-language.

Breeding, Marshall, Ed. Library Technology Buying Strategies. ALA Editions, 2016.

California Digital Libraries. “CDL Model License Revised,” cdlib.org/cdlinfo/2017/01/25/cdl-model-license-revised/.

Carter, Sunshine J. “Adoption of NISO’s Shared Electronic Resource Understanding (SERU).” LRTS, Vol. 63, No. 4, October 2019, pp. 185-195.

COUNTER. https://www.projectcounter.org/.

Greater Western Library Alliance. “Agreements and Licenses,” www.gwla.org/agreements-and-licenses.

LIBLICENSE: Licensing Digital Contents – a Resource for Librarians, liblicense.crl.edu.

LIBLICENSE Model License Agreement (LIBLICENSE) with Commentary, LIBLICENSE.crl.edu/wp-content/uploads/2015/05/modellicensenew2014revmay2015.pdf

Lipinski, Tomas A. The Librarian’s Legal Companion for Licensing Information Resources and Services. Neal-Schuman, 2013.

National Information Standards Organization. SERU: A Shared Electronic Resource Understanding, RP-7-2012. NISO, May 2012, www.niso.org/publications/rp-7-2012-seru.

Stim, Richard. Contracts: the Essential Business Desk Reference. Nolo, 2016.

Authors

Sunshine Carter (she/her/hers) is the Director of Collection Strategy & eResource Management at the University of Minnesota Libraries in Minneapolis. She is responsible for the entire life-cycle of e-resources (acquisition and management), licensing, collection development strategy and oversight over the collection budget. She has been negotiating e-resource licenses since 2005. She has a M.S. from Iowa State University and an M.L.I.S. from University of California, Los Angeles.

Ruth Dukelow (she/her/hers) is a graduate of The Catholic University of America (MSLS) and Duke University School of Law (JD). Prior to retirement, she was the Executive Director of CLIC-Cooperating Libraries in Consortium in St. Paul, MN. Previously, she was the Associate Director at Midwest Collaborative of Library Services/Michigan Library Consortium. Prior to that, she was the legal specialist in the Library Development Division at the Library of Michigan where she assisted all types of Michigan libraries with legal questions relating to library service. She has worked in public, academic, and law libraries, and she also worked in a law firm for two years practicing oil and gas law before returning to library work. In 2009, she received the Michigan Library Association’s Librarian of the Year Award. She is the author of The Library Copyright Guide (AECT 1992).