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The source code for the 1.x versions of Scratch (developed in Squeak Smalltalk) were released under the custom Scratch Source Code License, which appears below. Scratch 1.4, along with 2.0, was also released under the GNU General Public License V2 (GPL2).
Scratch Source Code License
Copyright (c) 2009 Massachusetts Institute of Technology
All Rights Reserved.
Scratch was developed by Lifelong Kindergarten group at the MIT Media Lab. See scratch.mit.edu.
Permission is hereby granted, free of charge, to any person obtaining a copy of the Scratch source code and accompanying documentation (the "Software"), to use, copy, modify, merge, publish, or distribute the Software or software derived from it ("Derivative Works") for non-commercial purposes, and to permit persons to whom the Software is furnished to do so, subject to the following conditions:
1. The above copyright notice and this permission notice shall be included in all copies of the Software and Derivative Works.
2. The word "Scratch" shall not be used to refer to Derivative Works except in the phrase "Based on Scratch from the MIT Media Lab" provided that such phrase is not used to promote the Derivative Work or to imply that MIT endorses you or the Derivative Work.
3. Derivative Works shall not use the Scratch logo or the (copyrighted) default Scratch sprite cat used in the official Scratch software distributed in binary form by the Lifelong Kindergarten group at the MIT Media Lab.
4. Derivative Works shall not implement or enable any feature that would allow uploading Scratch projects to any MIT Scratch website (currently http://scratch.mit.edu).
5. The source code for any Derivative Work based on this software shall be made readily available to the public, ideally on a public web site, free of charge.
THE SOFTWARE IS PROVIDED "AS IS", WITHOUT WARRANTY OF ANY KIND, EXPRESS OR IMPLIED, INCLUDING BUT NOT LIMITED TO THE WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE AND NONINFRINGEMENT. IN NO EVENT SHALL THE AUTHORS OR COPYRIGHT HOLDERS BE LIABLE FOR ANY CLAIM, DAMAGES OR OTHER LIABILITY, WHETHER IN AN ACTION OF CONTRACT, TORT OR OTHERWISE, ARISING FROM, OUT OF OR IN CONNECTION WITH THE SOFTWARE OR THE USE OR OTHER DEALINGS IN THE SOFTWARE.
The GPL license for Scratch can be found here.