By retaining title to the software, the computer software company seeks to impose conditions upon the purchaser, or licensee, that are not otherwise permissible under federal copyright law. The enforceability of shrink-wrap licenses has been challenged in the courts. The prevailing view is that when mass-market prepackaged software is sold, the transaction is a sale of goods and not a true license agreement. The key issue is whether the license document is part of an enforceable contract. Defenders of shrink-wrap licenses argue that the purchaser agrees to the conditions of the license after breaking the packaging seal and therefore contract law must uphold the written terms of the contract.
Opponents argue that the sequence of events in the typical software purchase transaction is skewed.
The purchaser is not aware of the license agreement until after the sale is consummated. The purchaser's acceptance of the license agreement is inferred when he or she opens the package or uses the software. However, the purchaser does not sign the license agreement. He or she may not even read the terms of the license agreement and, in any case, does not expressly agree to them. Because of these conclusions, the license agreement was invalid and unenforceable.