Vondran Legal® - Nationwide Copyright Software Audits - Understanding the Autodesk EULA. Facing an audit? Call us at (877) 276-5084. We have handled HUNDREDS and HUNDREDS of cases large and small.
Introduction
Autodesk handles three different types of audits. Knowing what you are involved in is always the first step to mapping out a responsive game plan to deal with their audits.
The internal audit.
This is where an internal team will (many times) try to catch a company (even good paying companies), overusing or over-assigning licenses. This can typically start with a heavy-handed contact from one of their "mediators," as we sometimes call it, and they may be demanding you purchase multiple licenses to cover the shortages on your computer. This, even if you do not technically need any additional software, and they may be requesting you purchase one or more three-year license subscriptions. These types of audits are driven by their EULA, which they will assert you agreed to when you signed up for their software.
The Law Firm Audit
Autodesk will sometimes use a bay area law firm to conduct software compliance reviews, and you may receive a letter from a IP law firm called "Donahue Fitzgerald." This firm is highly skilled and experienced in this area, and many times you will be asked to conduct a "manual audit" (filling out a software spreadsheet showing your license entitlements and proof of purchases). These cases can also result in heft fines, but I have found the law firm the most reasonable to deal with.
Business software alliance (third-party audit)
This is where the "BSA" sends your company a demand letter asking you to either submit to run their AIT scans (running their audit software on your computers) or provide them with the results. This too can lead to high demands, and they will ofter point to the EULA audit clause to justify your purchase requirement. I have seen so many companies over the years get roped into purchasing software they did not need (as this can happen even if you have a software license for each user), and they can even throw on other fees and possibly a software infringement mutliplier.
The Autodesk EULA
Regardless of the type of audit, if you are wondering what your obligations are, typically, we direct our clients to their end-user-license-agreement. Here is what you may find:
9.7 Audits. Licensee agrees that Autodesk has the right to require an audit (electronic or otherwise) of the Autodesk Materials and the Installation thereof and Access thereto. As part of any such audit, Autodesk or its authorized representative will have the right, on fifteen (15) days' prior notice to Licensee, to inspect Licensee's records, systems and facilities, including machine IDs, serial numbers and related information, to verify Licensee's Installation of and Access to the Autodesk Materials.
Additionally, within fifteen (15) days of the audit request, Licensee will provide to Autodesk all records and information requested by Autodesk in order to verify Licensee's Installation of and Access to the Autodesk Materials. Licensee will provide full cooperation to enable any such audit.
If Autodesk determines that Licensee's Installation of or Access to the Autodesk Materials is not in conformity with the applicable agreements or terms of service, Licensee will obtain and pay for valid license(s) to bring Licensee's Installation and Access into compliance and pay the reasonable costs of the audit. In addition to such payment rights, Autodesk reserves the right to seek any other remedies available at law or in equity.
Attorney Steve® Tip: Let's break this down, if you signed the EULA, and they want to audit you (random or based on suspicion of software piracy) they have the right to do that, and you agreed by installing their software. They can require you to purchase products, and pay the reasonable costs of the audit. In one case, I was stunned to learn that they were seeking over $80,000 in costs on one case. When I asked how on earth a fee like this could be racked up, there was no explanation (crickets). So, this highlights the importance of seeking legal counsel, because in many cases, you will likely be dealing with their highly-trained software counsel.
Are these types of "Clickwrap Agreements" enforceable in the 9th Circuit?
Generally, they can be. See Blair v. Superpedestrian HQ (C.D.Cal. May 8, 2023, No. 2:23-cv-02153-MCS-AGR) 2023 U.S.Dist.LEXIS 80426, at *5-8.) which held:
The arbitration agreement in this case involves what has come to be referred to as "clickwrap." "Clickwrap" is an agreement "in which an internet user accepts a website's terms of use by clicking an 'I agree' or 'I accept' button, with a link to the agreement readily available." Sellers v. JustAnswer LLC, 73 Cal. App. 5th 444, 463, 289 Cal. Rptr. 3d 1 (2021) (internal quotation marks omitted). "[C]ourts have routinely found clickwrap agreements enforceable." Berman v. Freedom Fin. Network, LLC, 30 F.4th 849, 856 (9th Cir. 2022). As with any other contract, however, "clickwrap" agreements must be supported by mutual assent. Sellers, 73 Cal. App. 5th at 461.
"[I]n order to establish mutual assent for the valid formation of an internet contract, a provider must first establish the contractual terms were presented to the consumer in a manner that made it apparent the consumer was assenting to those very terms when checking a box or clicking on a button."
Here, the User Agreement states,
"By tapping 'I agree' I confirm that I am at least 18 years old (or other legal age of majority) and that I have read and agreed to the following Superpedestrian policies." (McKinney Decl. Ex. A.) "The Superpedestrian App presents users with a direct link to the full text of Superpedestrian's User Agreement" containing the arbitration clause requiring "Superpedestrian and its users to submit all disputes arising out of or related to Superpedestrian's Services, including use and rent of a scooter, to binding arbitration." (McKinney Decl. ¶¶ 9, 13.) Before the user can proceed, he or she must "physically check a box indicating that the user has read and agreed to Superpedestrian's User Agreement." (Id. ¶ 8.) The link to the full text of the User Agreement is underlined, in the middle of the screen, and generally separated from other text. (Id. Ex. A.)
As a result, the Court concludes that "the contractual terms were presented to the consumer in a manner that made it apparent the consumer was assenting to those very terms when checking" the box next to the link to the Terms and Conditions. Sellers, 73 Cal. App. 5th at 461; cf. Adibzadeh v. Best Buy Co. Inc., No. 20-cv-06257-JSW, 2021 U.S. Dist. LEXIS 193421, 2021 WL 4440313, at *6 (N.D. Cal. Mar. 2, 2021) (concluding users were afforded reasonably conspicuous notice where they were required to "agree to the website's terms and conditions before they [could] proceed, and the terms and conditions [were] offset in a blue[], hyperlinked text.").
Plaintiff's averments that he does "not recall being asked to sign or agree to any terms or conditions at that time and [he] received no notification of any terms or conditions" are unavailing. (Blair Decl. ¶ 6.) Defendant submitted evidence that "Plaintiff Douglas Blair created a Superpedestrian user account and affirmatively accepted Superpedestrian's User Agreement at 4:51 UTC time on December 23, 2021." (McKinney Decl.¶ 15 & Ex. B.)
Where a user checks a box agreeing to a website's terms of service when he or she creates an account, the user's inability to recall reading or agreeing to the terms of service does not undermine his or her assent. Houtchens v. Google LLC, F. Supp. 3d No. 22-cv-02638-BLF, 2023 U.S. Dist. LEXIS 3012, 2023 WL 122393, at *3-4 (N.D. Cal. Jan. 6, 2023); Crawford v. Beachbody, LLC, No. 14cv1583-GPC (KSC), 2014 U.S. Dist. LEXIS 156658, 2014 WL 6606563, at *3 (S.D. Cal. Nov. 5, 2014). Similarly, Plaintiff's "assertion that [he] may not have read the Terms of Service does not undermine [his] assent to the terms," Houtchens, 2023 U.S. Dist. LEXIS 3012, 2023 WL 122393, at *4, as "one who accepts or signs an instrument, which on its face is a contract, is deemed to assent to all its terms, and cannot escape liability on the ground that he has not read it," Randas v. YMCA of Metro. L.A., 17 Cal. App. 4th 158, 163, 21 Cal. Rptr. 2d 245 (1993) (internal quotation marks omitted).
So, if you agreed, and the court upholds the clickwrap agreement, you could be held to undergo the audit. If you do not agree to the audit, I have had times when Autodesk representatives may threaten to shut off your software if you do not perform the audit.
Purchasing hardware with pre-installed software
But, what happens when you buy a computer with software already installed? This happens, and in these circumstances, you may not have "agreed" to the terms of the license (somebody else did). Under these circumstances, are you really obligated to go along with their demands, regardless of which type of audit you are involved in? To me, this is a question that should be looked at.
Getting the Autodesk "love letter"
When you get the demand letter, the first thing you should consider is hiring legal counsel. You can rest assured that they are going to do their best to sell you software that you may or may not need, at prices you may or may not be able to afford. There will also be a question of getting a proper release of all legal claims as part of any settlement. With internal audits, this is not always the case from my experience. Another thing you should seriously consider before engaging with Autodesk is whether you are willing to run the AIT software scans, (as many times they require this). If it were my company I would seek an agreement that they would indemnify you for any data loss, or any damages caused to your computers, laptops and servers. These are just a few issues to keep in mind.
Contact an IP Software Audit Defense Firm
If you get the love letter, you should consider hiring a law firm, such as Vondran Legal®, that has handled approximately 500 or more software audits, making us one of the premier technology law firms in the country in this practice area. We have also handled hundreds of cases involving Microsoft, Siemens, Adobe, Ansys, Synopsis, Solidworks, Vero/Hexagon and others. Call us at (877) 276-5084 to discuss your case. Unlike traditional law firms, we offer low flat rate fees to resolve your case. So, when the case is over, there are no surprise bills, and we have no incentive to drag your case on, forever billing expensive legal fees. You can also fill out our contact form for more information.
