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First Sale upheld in software case

From: Alexander Terekhov
Subject: First Sale upheld in software case
Date: Tue, 06 Oct 2009 16:57:11 +0200

The footnote says it all.

"Although the phrase “copy of copyrighted material” is awkward, the
court uses it to emphasize the distinction between the copy and the
copyrighted material. See 17 U.S.C. § 202. Autodesk’s copyrighted
AutoCAD software is its intellectual property, and Mr. Vernor makes no
claim to it. Copies of AutoCAD software are personal property embodied
in compact disks and other media scattered across the world. Mr. Vernor
claims to be the owner of two such copies, contained in the two AutoCAD
packages still in his possession."

Here's the EFF's coverage:

"October 5th, 2009
It’s Still A Duck: Court Re-Affirms That First Sale Doctrine Can Apply
to “Licensed” Software 

Commentary by Corynne McSherry 

Building on a prior ruling, a federal court has re-affirmed that a
Seattle man was not infringing copyright law by re-selling software he
obtained from an Autodesk customer.

The ruling is bound to frustrate the copyright industries, which have
struggled for years to convince courts and their customers that the only
thing you “buy” when you buy software is a limited and temporary right
to use that software under certain conditions. In other words, they
claim buyers aren't owners. 

The distinction is no mere technicality. Under the Copyright Act, owners
of copyrighted material are given substantial rights in the particular
copies they purchase. One of the most important of these protections is
the "first sale" doctrine, which says that once you've acquired a
lawfully-made CD or book or DVD, you can lend, sell, or give it away
without having to get permission from the copyright owner. Without the
first sale doctrine, libraries would be illegal, as would used
bookstores, used record stores, video rental shops, CD-swapping
communities and so on. If those books, records, videos etc. were merely
licensed, the seller could use the license to could force consumers to
always buy new software, even if they would prefer to buy an older,
possibly less expensive, version.

Autodesk would like to do just that, which is why it carefully polices
secondary markets for its expensive AutoCad design software. After
Autodesk repeatedly alleged that Timothy Vernor was violating copyright
law by attempting to re-sell copies of AutoCAD software on eBay (which
he had obtained from an Autodesk customer), Vernor asked a Washington
federal court to declare that his activity was legal under the first
sale doctrine. Autodesk predictably responded by insisting that AutoCAD
is licensed, not sold, and therefore the first sale doctrine did not
apply. The court ruled for Vernor. Autodesk then recruited an expert,
put some additional facts on record, and effectively asked the court to
reconsider its decision. 

Autodesk’s arguments were no more successful the second time around.
Judge Richard Jones found that while the sale was subject to numerous
restrictions, it was nonetheless a sale, which means the customer had
all the rights of an owner, and thus would not infringe AutoDesk’s
copyright by re-selling the software. The court noted that while
Autodesk imposed typical software industry contractual restrictions on
use and transfer, its license agreement allowed the customer from whom
Vernor bought the software to keep the copies forever, for a one-time
fee. In other words, the transaction looked more like a book purchase
(you pay your money, you get a copy to keep) than, say, a music
subscription service. 

Autodesk is likely to appeal, which means this case is headed to the
Ninth Circuit Court of Appeals. The appellate court is already
considering similar issues with two other cases: UMG v. Augusto (EFF
represents Mr. Augusto, with Keker & Van Nest) and MDY v. Blizzard.
Let’s hope Ninth Circuit takes full advantage of this opportunity to
protect the rights and expectations of consumers. "


(GNG is a derecursive recursive derecursion which pwns GNU since it can 
be infinitely looped as GNGNGNGNG...NGNGNG... and can be said backwards 
too, whereas GNU cannot.)

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