The U.S. District Court in i.Lan Systems, Inc. v. Netscout Service Level Corp.[1]� has held that a clickwrap license agreement is enforceable under principles drawn from Article 2 of the Uniform Commercial Code. The court’s adoption of a “Money Now, Terms Later” approach, and the absence of decision law in this critical area, makes the determination highly important for online software distributors. Long Island’s software-rich environment creates a greater than usual opportunity for local lawyers to participate in software transactions, making the i.Lan decision of particular importance.
Plaintiff i.Lan is in the business of monitoring computer networks for its customers.[2]� Defendant Netscout sells software used to monitor networks, and its software is employed by i.Lan.[3]� In 1999 i.Lan acquired the latest version of Netscout’s software for a purchase price of $85,231. A dispute arose centered around i.Lan’s right to receive upgrades and support services from Netscout. Predictably, i.Lan claimed pervasive, perpetual upgrade and support rights, while Netscout claimed that i.Lan is entitled to only limited support.[4]�
