How do you know when a proposed software contract principle is really broken? When the Linux Foundation and Microsoft have their respective legal departments sit down and pen a joint letter asking it be reconsidered. ZDNet's Mary-Jo Foley has written a nice, legalese-free summation of the story.

In short, the American Law Institute (ALI) has proposed some guiding principles for judges, lawyers and other legal professionals working with software-related cases to aid in settling software licensing issues. Given how quickly everything about software delivery and production changes, this in and of itself is a decent enough idea. The problem is one particular principle, a policy calling for a non-disclaimable "implied warranty of no material hidden defects." Both the Linux Foundation and Microsoft say this is a disadvantage all around -- discriminating and subtlely changing between various licensing, business, and distribution models.