Legal Definitions - label license

A label license is a type of legal agreement where the terms and conditions for using a product are printed directly on its packaging, a label affixed to it, or included within the product's documentation. By opening the package, breaking a seal, or using the product, the consumer is deemed to have accepted these terms and conditions, thereby entering into a binding agreement with the manufacturer or seller.

Here are some examples to illustrate how a label license works:

• Example 1: Software Installation

  Imagine you purchase a new video editing software program. When you open the box, you find a CD-ROM and a small booklet. On the back of the CD case, or within the first few pages of the booklet, there's a statement that reads, "By opening this package, installing, or using this software, you agree to the terms of the End-User License Agreement (EULA) found inside." The EULA then details restrictions, such as limiting installation to one computer, prohibiting reverse engineering, and disclaiming certain warranties. Your act of breaking the seal on the software box and installing the program signifies your acceptance of these terms, creating a label license agreement.

• Example 2: Specialized Chemical Product

  A small business buys a specialized industrial adhesive. On the container, there's a prominent label stating, "Warning: For industrial use only. Not for resale to consumers. Manufacturer disclaims liability for misuse or application outside of specified conditions. By opening this container, user agrees to follow all safety guidelines and intended use." When the business opens the container and uses the adhesive, they are implicitly agreeing to these conditions, including the limitation on resale and the liability disclaimer. This constitutes a label license governing the use of the chemical.

• Example 3: DIY Smart Home Device

  You purchase a do-it-yourself smart home security camera kit. The packaging includes a sticker on the box that says, "Activation of this device requires acceptance of the manufacturer's privacy policy and terms of service, available at [website address]. Opening this box constitutes agreement." Upon opening the box and setting up the camera, you are bound by the terms outlined in the privacy policy and terms of service, even if you don't explicitly click "I Agree" during setup, because the label on the physical product established the conditions for use.