However, the U.S. Court of Appeals for the Third Circuit subsequently reversed this decision, ruling that the shrinkwrap licenses were not legally binding.

To facilitate this transition, Step-Saver purchased a multi-user operating system from The Software Link (TSL) known as "Multi-Link Advanced".

They also purchased computer terminals from Wyse Technology that claimed to be compatible with the Multi-Link Advanced operating system.

Combining these two components with computers provided by IBM, Step Saver began selling their new multi-user solution.

However, soon after Step-Saver began selling this product, complaints were received by customers claiming that the system was not functioning properly.

[1] However, TSL argued that the box-top license on the software delivered to Step-Saver was the only valid agreement made between the two companies.

Step-Saver argued, that any liability that it had to its customers should be shared by both Wyse and TSL since they were the original providers of the allegedly defective software and hardware.

TSL subsequently argued that the implied contract was not enforceable, but rather, that the Limited Use License Agreement (LULA) written on the software package was.

The court held that Step-Saver's motion for a declaratory judgment was 'unripe', on the grounds that cases involving customer suits had not yet been decided.

The errors in the Step-Saver system that initiated the suits had not been identified and thus could not be designated to be the fault of the hardware or software, in which case TSL and Wyse could be liable.

[5] Wyse technology and TSL sought to dismiss plaintiff's initial suit seeking compensation or indemnification for damages done to Step-Saver's business due to customer lawsuits.