Can use of a database be protected via a contract or license?

Big Data: Legal Challenges (Full Report)

For databases which are securely controlled, a contract is the best method to restrict and control access and use of the data. Often the database owner will seek to form such a contract online, which gives rise to issues as to the way in which traditional contract law principles apply to online agreements.

Enforceability of contracts purported to be made online

'Clickwrap' agreements, which require the user to indicate assent by clicking 'ok' or a similar button, have been routinely upheld in US law50 by application of orthodox principles of contract law in cases where it has been established that the terms of the contract have been drawn to the attention of the offeree and the offeree has manifested acceptance to those terms.

The position appears to be the same in Australia. In eBay International v Creative Festival Entertainment51, the Federal Court held that clickwrap agreements made on two websites were valid contracts. Similarly, in Smythe v Thomas 52, the Supreme Court of New South Wales held there was a binding contract where a purchaser bid in, and "won", an auction on eBay.

The position in relation to so called "browsewrap" agreements is less clear. In these cases a set of terms and conditions is available via a hyperlink on the website but the user is not forced to open the relevant web page, or click "I agree" after reading such terms. The information on the website is not protected for access to contracting parties only. In the United States, the position appears to be that browsewrap agreements are unenforceable unless the enforcing party can show that the other party had actual or constructive notice of the terms53. Whether browsewrap agreements are enforceable in Australia remains to be seen.

The enforceability of such online contracts has come to the fore in the context of website "scraping". "Scraping" refers to wholesale copying of data or information from websites, usually through automatic software programs54. The scraper can then use the data in competition with the website owner. The question arises as to whether a website owner which prohibits scraping in its website terms and conditions can claim breach of contract against a scraper.

The United States Court of Appeals for the Second Circuit in Register.com v Verio55 considered a breach of contract claim against a scraper of domain name registration data ("WHOIS data"). The website owner, Register.com, claimed that Verio's scraping of WHOIS data breached its terms of use. Verio admitted that it was aware of Register.com's terms (which were shown together with the requested WHOIS data), but argued that it had never agreed to them. Based on Verio's actual knowledge of the terms, the Court held that Verio had agreed to them56:

"We recognize that contract offers on the Internet often require the offeree to click on an 'I agree' icon. And no doubt, in many...