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Key Takeaways
- Maryland recently joined California in enacting new requirements that mandate clear disclosures when consumers are purchasing a license to digital goods rather than acquiring ownership.
- Similar legislation is also being considered in other jurisdictions, with a bill introduced in New York that would impose comparable requirements on the marketing and sale of digital goods.
- Businesses should review their legal terms and purchase flows related to digital goods to ensure that transactions are described accurately and steps are taken to help avoid consumer misunderstandings.
New Requirements for Offering Digital Goods in Maryland
House Bill 208, which went into effect on October 1, 2025, amended Maryland's consumer protection laws to impose requirements on businesses that offer digital goods for sale. These requirements apply to a wide variety of digital goods, including games, movies, music, and books. These new Maryland requirements, which closely align with new requirements imposed by California earlier this year, are intended to help ensure that consumers understand when they are purchasing only a limited license to digital goods.
The law applies to most sellers that are offering licenses to digital goods (as opposed to an ownership interest) but using terms that a reasonable person would understand to confer an unrestricted ownership interest (e.g., "buy" or "purchase"). However, the law does not apply to subscription-based services that grant access to digital goods only for the duration of the subscription; digital goods provided free of charge; or digital goods for which the seller cannot later revoke access, such as those made available for "permanent offline download to an external storage source to be used without a connection to the Internet."
When the law applies, a seller must do one of the following for each transaction involving the sale of a license to digital goods:
- Have the purchaser affirmatively acknowledge (1) that they are receiving a license to access the digital good; (2) a complete list of restrictions and conditions of the license; and (3) that access to the digital good may later be unilaterally revoked by the seller if the seller "no longer holds a right to the digital good."
- Provide the purchaser with a clear and conspicuous statement that (1) states in plain language that they are purchasing a license; and (2) includes a digital method to access the license details, terms, and conditions.
Importantly, the affirmative acknowledgment or clear and conspicuous statement must be distinct and separate from other transaction terms and conditions.
Violations of HB 208 are enforceable under the Maryland Consumer Protection Act and may expose violators to civil penalties, restitution, and private claims for actual damages and attorneys' fees.
Developments in Other States
Similar requirements are also being considered in New York, where Assembly Bill A8471 closely mirrors legislation already enacted in California and Maryland. While it is not yet clear whether the New York measure will advance beyond committee, its introduction underscores the growing multistate trend toward increased scrutiny on how digital goods are marketed and sold. Maryland is, therefore, unlikely to be the last state to follow California's lead in imposing these types of consumer protection requirements.
Recent Litigation Over Digital Goods
Even before state-enacted laws specifically regulating the marketing and sale of digital goods, there were consumer actions alleging that the use of terms like "sell," "buy," and "purchase" were misleading and deceptive when applied to the sale of a license to digital goods. That trend is likely to continue as the California and Maryland laws offer plaintiffs additional tools for challenging businesses that offer licenses to digital goods using the same terminology that has traditionally been used to describe the sale of physical goods.
Morehouse et al v. Apple, Inc., for example, is one of the recent class actions filed under California's false advertising law on digital goods. In Morehouse, consumers allege that Apple misled users of its Apple Books platform by marketing e-books and audiobooks with "Buy" and "Purchase" buttons that suggested ownership, when in fact customers only received revocable licenses to access the content. The complaint contends that Apple failed to clearly disclose that these digital goods could later be removed from a user's library if Apple's own content licenses expired. Plaintiffs claim that this practice deceived consumers, who reasonably believed they were acquiring permanent rights similar to those associated with buying a physical copy of a book and that Apple charged higher prices on that basis. The suit asserts violations of California's false advertising and consumer protection laws; brings claims for breach of contract, fraud, and unjust enrichment; and seeks damages, restitution, and injunctive relief.
Implications for Businesses
Businesses that market or sell digital goods, particularly in the media, entertainment, publishing, and gaming sectors, should anticipate heightened scrutiny of how digital transactions are described and presented. Maryland's new law, like California's, reflects a growing expectation that consumers be clearly informed when they are purchasing a license. As more states consider similar measures, companies should review their legal terms and purchase flows to help ensure that transaction terms are clear to consumers.
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