For almost half a century computer software has played an increasingly central role in our national and global economies. Nevertheless, the law still has not resolved the most fundamental question of whether contracts relating to computer software are for the sale of goods or services. Most courts considering this issue turn first to the Uniform Commercial Code.
UCC Article 2, which applies to the sale of goods, offers parties a panoply of contractual rights and protections. However, Article 2 does not explicitly mention software. While most courts considering the issue have held that computer software qualifies as a “good” under Article 2, that does not end the inquiry. Indeed, many corporate software transactions are more complex, a mixed goods-and-services arrangement involving both the sale of goods (software programs) and services (support and implementation) often under a license agreement as opposed to a sales agreement.
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