Rajah Lehal

Non-Transferable Digital Assets and Death: A New Legal Issue

July 06, 2015

A novel legal issue has arisen: authority over administering the digital assets and accounts of an account holder upon death or disability.

This article discusses the UFADAA, a model US statute that aims to make online websites require confirmation by the account holder that they agree to limit their digital assets in accordance with the user agreement. If they do not send the confirmation, the relevant provisions of the user agreement will be void as against public policy. The notice must be by a certified copy of the confirmation form.

Delaware is the first state to implement this type of statute. Yahoo and Facebook oppose the statutory scheme. Many providers’ agreements indicate that users’ accounts are non-transferable and terminable upon death. Without confirmation, under the model statute these clauses would be void because they limit the account user’s digital assets.

With the advent of ‘the cloud’, more and more digital assets are potentially affected by the non-transferability of user’s licenses.

Read the article here.

Take away:

  • The non-transferability of online users’ licences may become an issue for regulation as users age and cloud storage becomes more popular.
Intellectual Property
Transfer of Intellectual Property
Commercial Activities

Written by Rajah. Rajah Lehal is Founder and CEO of Clausehound.com. Rajah is a legal technologist and technology lawyer who is, together with the Clausehound team, capturing and sharing lawyer expertise, building deal negotiation libraries, teaching negotiation in classrooms, and automating negotiation with software.