An eula is a contract by the owner of the item and the person who downloaded it/bought it. Violating the End User License Agreement (EULA), which comes with most software, is also against the law. EULAs tell the owner, among other things, how many computers the software can be installed on and how many copies can be made. Some software, such as Netscape Communicator is freely available, but is still protected by copyright. As in the case of Netscape it may be illegal to distribute certain freely available software packages. EULA's can and are enforced. They can be used to install spyware on your computer when you are installing something else, they can be used to remove your rights of your products without you knowing it (geocities and the public 2000), It can be used to grant rights to install programs even virus' that you don't want or need on your computer. Taken from TechTV.com What is the basic law regarding making archival copies? The short answer to that question has two parts: one part involving copyright law, the other involving contract law. First, under a provision of the Copyright Act (17 U.S.C. 117, if you care to look it up), you have the right under copyright to make an archival copy of a computer program you lawfully own a copy of, subject to some conditions. For example, you must destroy the archival copy when you no longer own the original copy of the program. The second part of the answer is that although the underlying copyright law sets forth the default position, this can be affected by a contract between the vendor and the user. Generally, PC software is distributed pursuant to end user license agreements (EULAs). These EULAs often take the form of what is called a "shrink-wrap" or "click-wrap" agreement, where a user shows his or her assent to the contract by either breaking the shrink-wrap or clicking through an agreement when he or she installs the program. The EULA for a particular piece of software may restrict users' rights to the software, including their right to make archival copies. Under some EULAs, users do not even own their copy of the software, but merely receive a license from the vendor to use the copy. The EULAs for individual software vary, so read the EULA for the software in question for details. Why is most software distributed under EULAs? EULAs are somewhat specific to computer software. Most other forms of intellectual property are not distributed pursuant to a license. You don't have to assent to a license agreement when you buy a book or music CD, for example. EULAs began as a practice by software vendors in part because there were doubts in the early days of software programming (pre-1980) as to whether computer programs were copyrightable subject matter. Some people thought that copyright should and would be limited to more creative and nonfunctional works such as literary works, and there were some doubts as to whether copyright applied at all to computer programs. The software industry used contracts to try to protect computer programs, fearing copyright law would not cover its work. Today, this practice continues even though it is now well established that copyright law does cover computer programs. Is it OK to break copy protection schemes to make archival copies? No. A provision put in place by the Digital Millennium Copyright Act expressly forbids the circumvention of effective technological copy protection (17 U.S.C. 1201). This is in addition to and separate from the copyright and contract law questions. A defense to copyright infringement, such as making archival copies, is not necessarily a defense to the prohibition on circumvention of copy protection. There are exceptions to the general prohibition on circumvention of copy protection, including for the purposes of creating interoperable programs or for encryption research, but these exceptions are rather narrow. Please note that this brief overview is a general discussion of the legal issues surrounding archival copies. It is intended for informational purposes only and is not a substitute for professional advice on specific questions. Because of the generality of this discussion, the overview may not be applicable in all situations and should not be acted upon without specific advice based on particular circumstances. For example, individual situations may differ depending on the specific terms of an EULA and on other applicable state and federal laws. Now that is just on archived copies of software but it does point out that EULA's can restrict your right to make copies EULA's are enforcable under contract and copyright laws. They come in several forms but most are called click wrap eula's or Shrink wrap eula's ----Another website Lost the page info- HOW EULA came in existence? In the early days software development focused on the creation of customised software for mainframe computers and other computers. Contracts for this type of custom software were few, and involved two distinct parties whose lawyers could discuss all the terms of such agreement between them. This model changed when personal computers and their accompanying software became mass-market items and available off the shelf. In such market, the number of users increases by big numbers. The software programmer and the user could not face to face for the license negotiate terms. Thus the terms of such licenses had to be standardised and concise. The software license agreement needed to be presented to the customer in a fashion that would allow for mass distribution of software, yet would draw the customer's attention to the conditions under which the publisher offered to allow use of the software The standardisation also arose because of the provisions of the Copyright Act and other Acts in USA. SHRINKWRAP EULA The most commonly used EULAs are of the "shrink-wrap" or "break the seal" variety types. EULAs in this form are printed: On product packaging, A diskette or CD-ROM container (such as an envelope or a plastic case), A card inside the package, A page of the user manual. The user is asked to "accept" the terms of the agreement by performing a certain action designated on the package or in the EULA, such as: Tearing open the plastic wrapper covering the box, Breaking the seal on the diskette container Installing or using the software. The user can refuse to accept and enter into the agreement by returning the software product for a complete refund. CLICKWRAP EULA Software programmers also have EULA via media other than paper. One popular method displays the EULA on the computer screen the first time a user operates the software. The user can then accept the EULA's terms by pressing a certain key, clicking on a "yes" button icon or by clicking I Accept icon or taking some other specified action. This form of contract is popularly known as Clickwrap agreement Presenting EULAs via the computer screen is especially important now that more software is being distributed electronically through Internet and other media. For this form of distribution, the EULA often appears on the user's screen before the software is downloaded to the user. If the user assents to the on-screen EULA (usually by typing "yes" or "I accept," clicking on an icon with similar words, or simply pressing the "Enter" key), the user may install the software. Some features of EULA explained. I. It grants normally a nonexclusive, nontransferable personal license to the user by the software owner to use the software subject to the agreement. II. It is not a sale of Software. The licensee does not get rights as that of the purchaser of goods. III. It prohibits user to do certain things for example Reverse engineering, Decompiling, making additional copies, renting, leasing etc. IV. The software owner disclaims certain warranties. V. If the terms of the EULA are not acceptable to the consumer then the software product can be returned to the vendor and license fees will be refunded to the buyer in case of off the self-product. VI. In case of online media the license terms should be disclosed in advance of a buyer's purchase of the product or service. In such case of online EULA, the consumer if not accepting the terms will not be required to make any payment. A principal concern for computer software producers is providing adequate protection for their programs. Generally, software is written by a programmer in source-code form, which is in a language understandable by humans. Once the source code is completed, it is processed through a compiler that produces the object code. The object code is comprehensible to the computer on which it runs but not to humans. Because of this unique way computer programs are created, the programs are susceptible to "reverse engineering" or "decompiling." The user of a program may take the object-code version of the program and process it through a decompiler, which produces a higher-level source-code version of the program. Humans can with some effort, understand this source-code version. Thus, the secrets of the software producer can be discovered by anybody who is willing, or who has a financial incentive, to go through the process of reverse engineering. As a result, software producers include an express provision prohibiting disassembly or reverse engineering in their EULA. Warranty Disclaimers Vendors, through the use of shrinkwrap licenses, seek to disclaim both implied and express warranties by including a provision claiming that the program is provided "as is" without any type of warranty. Other licensing agreements limit the warranty for a specified amount of time, usually for ninety days, one year, or both. These provisions will be subject to the laws of land. Shrinkwrap License may broadly cover following provisions. Product name (the "Software") Limited Nonexclusive, personal License Restrictions on copying No Reverse engineering, Decompiling, making additional copies, renting, leasing etc allowed. Limited Warranty Limited Remedy No Incidental or Consequential Damages Termination Entire Agreement, etc. General clauses Jurisdiction EULA's ARE enforcable. It's based on contract and copyright law and is enforced by law you can go to court on them however and you MIGHT win but usually unless the terms are completely rediculous usually not