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Universal Attacks First Sale Doctrine
I Don't Believe in Imaginary Property writes "In Universal Music Group v. Augusto, UMG is attacking the first sale doctrine. The issue concerns some promotional CDs that were mailed out, and later found their way to eBay. According to UMG, the stickers on the discs claiming that they still own the CD give them a legal right to control what the recipients do with them, and thus, UMG should be able to dictate terms. The EFF has filed an amicus brief countering that claim, saying that because they were sent by US mail, unrequested by the recipient, they are in fact gifts, no matter what the sticker claims. If UMG somehow wins this, I plan to send them CD of copyrighted expletives with a sticker informing them of the contractually required storage location. We discussed a similar issue with e-books a couple weeks ago."
When would they learn that these actions are just harming them in the long run.
How much money did they 'lose' versus the amount of bad publicity they are getting in the meantime. And let us not forget all the lawyer fees.
Of course, on /. there's the normal "I have the physical copy, I can do whatever I want with it" mentality.
But what if Universal had signed a contract with each and every DJ and reviewer that got a promo copy that said "in exchange for getting this CD a week early, you have to keep it secret." Would people still be in favor of the rule that the person with their hands on the physical copy gets to do whatever they want with it?
It seems like if this were a once-off transaction there'd be no doubt that the world would be better off if the person with the physical object gets to resell it, no matter what the contract says. But is the world better off if Universal sees what happens and stops giving out review and promo copies? People complained when Maxim reviewed a CD without listening to it but there's no way for print publications to review albums without advance/promo copies. The print publication cycle is so slow that if a magazine had to wait to buy its copy at Amazon or the iTunes store then the review would be three months stale. And Universal is going to quite logically not send out promo copies if they find their way out before the release date; they don't want an unfinished product on the shelf any more than you want your neighbors looking at you before you finish dressing.
There's more than just this case. Maybe the tradeoff is that we're willing to give up promo copies in exchange to keep the doctrine of first sale pure. But maybe we're not. It's not an easy issue and there are arguments on both sides.
If it's still theirs, why not just sue them for theft?
Seriously, whoever came up with the idea of this lawsuit should be dismembered and have their body parts on display in every major city, just to warn the lawyers.
So, if I'm sent a promotional, but unrequested book, would it lose its copyright?! I could photocopy it of course and give it to friends, possibly as an example of "promotional products handed over to me". But, it sounds far reaching that it would lose its copyright. If I'm sent unrequested GPL Code, which relies on copyright, I don't think that code would lose its copyright either.
I don't think this is a First Sale issues, since, clearly, the discs are at no time sold. They send them promotionally to people in the recording, film, and media industries for review, evaluation etc. I get them all the time because some random label hopes I'll tell a director to put in these "hot new tracks" (or not). They got a big sticker on them that says, essentially, "NFR". I don't think they're the property of the label, strictly, but the labels and the media endpoints that consume the NFR discs both benefit from having them. Maybe selling them is de jure legal, but it's really dickish.
Any developers wanna opine on how they'd feel if some software reviewer at cnet started selling their NFR copies of pre-release software?
Don't blame me, I voted for Baltar.
Wasn't there some stupid company 6-7 years sending unsolicited barcode scanners called the "cat-something-or-other"? They had some hare brained scheme of money by having people scan bar codes of products and transmit them back to the company.
Unfortunately for the company, people had better ideas what to do with the product. The company tried to sue and they were laughed out of court.
Dear record companies:
When your own VP of content protection admits in a deposition that he has bought some of your promo CDs on the second hand market, your case that someone selling them on eBay is infringing your copyrights starts to look, well, ridiculous.
(EFF Brief, page 18.)
Copyright gets more and more ridiculus over time.
Unsolicited packages are gifts, as long as you're the intended recipient (and yes "The Occupier" counts). (Unsolicited Goods Act, Consumer Protection [Distance Selling] Act).
I would say "I can't believe the US doesn't have similar laws", but I can, because I recognise a country where Corporations have a massively disproportionate sway on legislators.
Athletic Scholarships to universities make as much sense as academic scholarships to sports teams.
Pretty soon we'll have implants in our heads that will debit our accounts every time we recall a song from memory. Got that Shakira piece stuck in your head again? Boy, you are going to pay....dearly. Shakira-Sha--SHIT!!!
any attorney associated with this should not be allowed to practice law. any law 101 student can tell you this is pure BS. you have to have a contract before you can enforce one. A contract requires compensation by both parties (both get something) you can't enforce any limits on something you give away for free. This is why often when property is given to charity etc its actually sold for one dollar. You learn this in the first 5 minutes of contract law!!
I don't know Mr. 741N, you sound a little biased.
You got some evidence that vinyl is growing?
Can you be Even More Awesome?!
Next step? Should be obvious, that sticker will be part of every CD sold. You may buy it, but it remains our property.
Impossible? Don't think so. The CD already somehow changed from a necessary evil as a carrier for intangible stuff (you can't simply carry the bits in your hand, so there has to be some sort of place where you put them) to 'the' product. At least that's what the content industry tries to do, and so far quite successfully so. Media shifting is becoming more and more difficult, distributing tools that enable you to media shift easily have been outlawed, and generally the content industry is pushing towards making the medium and the content interchangeable concepts, tying the content to its carrying medium.
This trend does not take into account that I have a valid license to the content (and if it's not, tell me what it is. I certainly don't get to own the content, so please tell me what I get when I purchase the CD). In other words, since that license contract is not limited in time, I should have the right to request the content I bought in case the carrying medium fails for some reason, since moving the content away from its carrier is being made impossible. Do I have the right to get a replacement copy? I wouldn't bet on it. And certainly I would not put any money on being able to get a fresh CD in 10 or 20 years.
If that sticker trick works, soon the only right we'll have around content is paying for it.
We used to have a Bill of Rights. Now, with the rights gone, all we have left is the bill.
I not only read the ARStech article, but the EFF article and the actual motion by the EFF. Assuming that they're quoting relevant cases (I'm not that much of a sucker for that kind of stuff), Universal is talking out their ass and trying to squash first sale rights.
To summarize, they sent out the CDs unsolicited, which according to the law, makes them gifts. That means it's as if the recipient bought the CD, and hence triggered first sale doctrine. So the eBay reseller is in no way whatsoever violating copyright. Especially since the guy in charge of copyright at Universal admits that he has, in the past, bought promo CDs from record shop.
Cynical Idealist
The way to deal with reviewers who doesn't treat your unsolicited promo material with proper discretion, is to stop sending unsolicited promo material to those reviewers. It's not an easy issue and there are arguments on both sides. Yes, on one side there is respect for the fundamentals of contract law. On the other side, there is the slight inconvenience of labels to have to maintain a list of trusted reviewers (rather than just maintain a list of reviews).
It does say something about how the labels have gotten adjusted to having the law formed for their convenience, that they now want to change how the legal system works, just to avoid the inconvenience of making some minor changes to their internal procedures.
By reading this comment, you agree that 10% of your gross income belongs to Twitter. I know that you did not ask for this but you will be one of the first few to read it and that, by your own argument, is worth more than your freedom. Be glad I don't ask for more, but Moses once argued that a happy slave is more productive than a hungry one so this works out for both of us.
Seriously, it's that bad. If the MAFIAA was not happy with people selling their crappy little promo copy, they could simply strike those people off the promo list. That's easier and cheaper than filing a laughably stupid lawsuit. The only explanation for the suit is that the MAFIAA needs the DJs more than the DJs need the MAFIAA and the only way to make the DJs do as they are told is to harass them with lawsuits. Let's hope the MAFIAA loses this one and has to pay cost and damages.
Friends don't help friends install M$ junk.
What I really want to know is what do they expect us
to do with these cds (bought or given).
Should we even be listening to them really?
Can you listen to your copy with a friend?
Can you listen to your copy with a group of friends?
Can you lend out the cd to a friend?
Can you lend out the cd a stranger?
Can you lend out the cd to a group of strangers?
So why not sell it to a group of stangers?
Where is the line drawn?
---
Music is freedom - the medium is not.
Despite what the snippet claims, this is NOT about first sale at all.
First off, even in a world without copyright law, UMG would argue that they had a contract with whoever got the CD to never redistribute it. If this contract was in fact made (offer and acceptance for consideration) then BOOM, contract law does the rest. This issue is complicated because while the items were unrequested, they were subsequently used by those who received them (which normally is enough since there was clearly some pre-existing contact here), and is further complicated because they were sent through the mail (which makes it almost surely a gift).
So, either it's not a gift and there's a contract, or it's a gift and there's no contract.
Then fair use / copyright comes into play. Normally 17 USC 106(3) makes it a violation to publicly distribute (including sell) protected material. However, 109 says you can do what you want to it (this is first sale) so long as you meet some requirements:
* Copy must have been made lawfully
* Seller must be an owner
The first of these doesn't seem to be a problem. The second is the issue. If these aren't gifts, and they didn't accept the contract, then they aren't owners--they are tortfeasors who have converted--and don't get protection from 109. That's how this would play out.
There's a lot of FUD going on out there. Feel free to correct me, but let's keep the analytical structure in mind here. (Note: I'm going off of the brief snippet; I haven't read the extensive briefs/filings)
The whole point is promotional copies have been around from day one and the same rules have always applied and that includes posters. Technically you aren't supposed to sell them in spite a thriving industry selling old movie posters.
Technically, you are perfectly entitled to sell an old movie poster. You are not entitled to duplicate and distribute it, but as long as it's a legitimately produced original, you can sell it to whomever you please.
The rules for promotional copies are no different than for anything else---you may resell original copies as you see fit, but duplication is the sole right of the copyright holder.
There is an exception, of course, and that's where terms were agreed to in advance. That, I think, is where you're getting your notions about movie posters. I would be shocked if the studios didn't require theater owners to sign boilerplate contracts covering promotional materials before they rent them films.
As such, I'd be willing to bet the vast majority of original movie posters on the market right now are or have been sold in violation of contract terms.
Note, however, that that's not what's happening in this case. UMG didn't arrange any agreements in advance, they just wrote something on a CD and mailed it.
"The record companies have always looked the other way when DJs handed them out to friends when they were supposed to be used in on air promotions and for air play but a lot of the tolerance may be drying up."
As regards airplay, the studios are perfectly within their rights to crack down. Public performances aren't fair use. As regards giving the discs to friends, DJ's have just as much right to that as you do to, say, give a friend of yours a chair you no longer wanted.
"Well here's food for thought, if you can get all your music from garage bands then why do you care what the music companies do?"
When they obey the law, I don't. My concern, and I think this goes for a lot of people around here, is for the consequence on the legal system and the basic framework of how contractual obligations work and are incurred.
You imply the record companies are simply getting desperate and asserting rights they always had---that simply isn't the case.
Here's the distinction, using your movie poster analogy (which works perfectly:)
A:) A movie theater owner has a contract with a movie studio that says he can't resell promotional items. The studio sends him a poster. He cannot legally sell it.
B:) A movie theater sends some random guy (or a movie theater owner with whom they have no contract) a poster which simply says, "This poster not for resale." He doesn't have to take orders from uppity posters he didn't ask for.
I hope you weren't really trolling, because that took a little while to type.
...if it succeeds, then you can surely be held responsible for all those AOL CDs! ;)
I hope you kept them in a safe place
not being an American I don't have any special interest in how this case turns out from the social realities of living with laws like this, but if this does go through then people could cause serious problems for the record labels. For example 100,000 people could get together and send riaa companies CDs through the post with stickers saying they have to be stored at the central lobby of head office. Under their rules they would have accepted the contract by opening the package - the best they could do would be to return them at their own massive cost.
They might even have to listen to them if they often get CDs through for business - according to the that's certainly enough to have accepted a contract
*''I can't believe it's not a hyperlink.''
Where would they be contractually required to stick said CD, then? ...
I don't know Mr. 741N, you sound a little biased.
That would be the resistor between pin 6 and pin 2.
Surely the raison d'être for a promo CD is to promote the freakin' content: i.e. the more people hear the CD the better. On-selling the CD is extending its reach further than UMG's original gift of it did. UMG should realise this, STFU, and let someone else promote their product at no cost.
Patent litigation: A doctrine of Mutually Assured Destruction... in which everyone seems willing to push the button
If the record companies are claiming they still own all of these millions of CDs out there it seems the states should haul there asses into court for not paying the proper property Tax on them. Wouldn't be any different then leased/rental equipment. Oh and the SEC might be interested in why they don't show up on there balance sheets as assets.
these lawyers should really read there own briefs. There is no copyright law in play here. Universal is the copyright holder and Universal made the copies. filing a DMCA is harassment and abuse of process. By there own statements there claiming that they own the cd's ... So its a case of selling stolen property. There saying to original recipients did not have standing to sell the cds to the defendant. But i can guarantee the cds are not listed as assets by the company. So we have a company claiming this guy is selling stolen merchandise that in other legal fillings (read SEC) they don't claim to own. If this guys lawyers are any good he'll retire to a nice island in the bahamas after this.
Fringe groups A,B and C are buying less CD's, so CD's must be dying. Except that not-so-fringe group D (Being the other 95% of the population that are not Audiophiles, DJ'd or Rappers) are simply never going to be interested in Vinyl ever again.
Digital Distribution may kill CD's, vinyl sure as hell won't.
Call it "first transfer of ownership" if it makes you happier. I am of course free to do with the physical content sent unsolicited into my mailbox as I please. Including auctioning it off at Ebay.
Nobody has a right to stuff my mailbox with stuff that is not even supposed to be mine.
Support the EFF so they can keep stomping stuff like this!
Fine, whatever, let 'em burn. The Internet is orders of magnitude bigger than rock and roll. If the preservation of the music and movies industry means we have to cripple the freedom of the network, to give Hollywood a veto over every new technology, to mandate lockouts in all computers to protect their imaginary property, then it's not worth it. Even if it means there'll never be another international rock superstar.
Real Daleks don't climb stairs - they level the building.
I think that is possibly the first op-amp joke I've ever seen/heard. Congratulations.
"It doesn't cost enough, and it makes too much sense."
If you're going to ask questions just to see an answer, that is.
How about: what about if the CD sticker said that by reading the sticker you agree to deep throat the VP of marketing? Would that be legally binding?
I mean, if we're going to be making shit up and all, just to ask hypothetical questions, why not go for the gusto?
If the record companies still own the CDs and have been sending them out unsolicited, then I recommend that everyone they've sent them to starts billing them for storage charges.
Let's see if they decide that they still own them then.
-Never argue with an idiot. They drag you down to their level, then beat you with experience-
eff universal
There is no right to feel safe thru security vaudeville at the expense of everyone's freedom, privacy and tax money.
So if they still own it isn't this littering?
I remember when I was in college, many of the textbooks that I bought used were in perfect condition, and underneath the "used" stickers the book was stamped "promotional copy, not for resale." The textbook publishers send out free copies to professors, hoping that they will select the book for their class. The professors often sell them to used book companies.
It might also come in handy during your yearly review - it would give you useful feedback.
Tiller's Rule: Never use a word in written form that you've only heard and never read. You will end up looking foolish.
But what if Universal had signed a contract with each and every DJ and reviewer that got a promo copy that said "in exchange for getting this CD a week early, you have to keep it secret."
What if pigs could fly? What if I won the lottery? What if CowboyNeil got laid? What if Sony's Ceo's wife was a crack whore? (oh wait...) What if water was undrinkable?
What if your post got modded "-1, troll"?
mcgrew's razor: Never attribute to stupidity that which can be explained by greedy self-interest
if you get something for free and want to sell it use craigslist. At least that way you won't have to pay if no one buys.
The "unrequested" word is the hole in EFF's argument. Many radio stations and music publications have websites with some language of the effect: Send promotional materials to this address. That's a request as far as I'm concerned. My wife is an independent recording artist, and at first it pained her to see the promo copies on eBay and Amazon marketplace competing with the real product, but at least the music is out there. We don't sue anybody; we just ink the name of the station or publication onto the face of the CD. The descriptions of the used product for sale let us know where not to send promo CDs in the future. As an aside: Surprisingly few radio stations and publications will accept any digital form of promotional materials!
"Not For Resale" was probably put there by one of their lawyers in the first place to avoid some retail tax or artist royalty.
Well they would be. Imagine this lawsuit going through then AOL suing everyone in America for all the cd's and disks they send out.
I'm sure there are lists out there but maybe it is time to put together a list of artists who are signed on with UMG and boycott every single one of them. These guys are just frothing at the mouth and it is time for consumers to bitch slap them. This is ridiculous.
http://new.umusic.com/Artists.aspx?Index=0
I think if someone gives you a "gift" and asks you not to sell it, legally binding label or not, you're not being particularly good-mannered by selling it. I know the RIAA has lost all respect, but don't forget the intent, whether you think it's legal or not. You're all beginning to sound like lawyers -- knowing full well what the people meant to do, but looking for any loopholes to get you way.
http://en.wikipedia.org/wiki/US_Postal_Service#Governance_and_organization
- None can love freedom heartily, but good men; the rest love not freedom, but license. -- John Milton
For me and most sane folks on Slashdot, Macthorpe's weird obsession with twitter is the current running joke. It's like Macthorpe has a schoolboy crush on him and expresses it by constantly pulling twitter's hair and putting bugs down his shirt. The two of them should get a room because it's pretty obvious they're about to start making out, and no one wants to see that.
- None can love freedom heartily, but good men; the rest love not freedom, but license. -- John Milton
"Universal Collides With First Sale Dactrine" seems more accurate (and I don't that it will be the First Sale Doctrine that will get dented).
Warning: this article may contain humor, sarcasm, parody, and perhaps even irony. Read at your own risk.
DVD's received by sending 5 cereal box tops
clearly state in their EULA that the disc is the
property of the studio and that they can collect
it back at any time. Interesting...
But the DMCA also has a provision to punish fraudulent use of its provisions, and the punishment is rather severe.
So what does the awful UMG argue? Hey that wasn't an official DMCA notice. We only happened to coincidentally meet all the requirements listed in it. But because it wasn't an "official DMCA takedown request", we're not bound by the DMCA at all. You can't punish us under it!
I hope the court is not so stupid as to let them get away with this fraud, lie, and abuse of the DMCA process.
"It's the height of ridiculousness to say for those 9 lines you get hundreds of millions."
That law that states that unsolisited material mailed to you is "yours". Is very, very importent. If it was not there I could mail anything to your house and then demand payment or that you pay postage to return the item.
And the recipients signed the stickers (agreed to the terms) and sent the stickers back to Universal, right? If so, then that's pretty solid evidence of a meeting-of-the-minds. Once Universal introduces those signed stickers in court as evidence that the contract really exists, the recipients are fuc--- what? Wait, what do you mean they didn't sign 'em and mail 'em back?! And Universal sent kept sending CDs?!
I hope Universal wins. I have some contracts (that they'll agree to by default) that I want to mail to them.
"Believe me!" -- Donald Trump
Gotta make you understand.
I read both briefs, and they are interesting. The consensus of slashdotters seems to be in favor of the EFF position. I agree.
What about the lawyers here. What do you say; who is likely to prevail?