Federal Court Says First-Sale Doctrine Covers Software, Too

New10k writes "The US District Court in Seattle has rejected Autodesk's myriad arguments regarding its software licenses and found in favor of eBay seller Timothy S. Vernor. The ruling started by ruling that Vernor was within his rights to resell copies of AutoCAD Release 14 he got in an auction. Once the court settled the legitimacy of reselling, it used that ruling as a lens to dismiss all of Autodesk's various claims. More than once the court described Autodesk's arguments as 'specious' and 'conflicted.'" Autodesk managed to have Vernor's eBay account pulled, after he listed for sale copies of AutoCad 14. He sued Autodesk in response.

Comments

Not really adding anything important but...

[Uncle Focker]

Score one for the little guy!

Re:Not really adding anything important but...

[Izabael_DaJinn]

It's not like keeping people from reselling things on ebay will stop piracy....

Re:Not really adding anything important but...

[Anonymous Coward]

without uninstalling...

So, did Vernor? Or are you just throwing some bullshit out there like "We should just kill everyone because they might commit a crime"?

Re:Not really adding anything important but...

[phpmysqldev]

This is definitely a step in the right direction for EULA regarding software. So many companies today are using the DMCA in the wrong sense and this is hurting the intellectual property situation for everyone.

More details about how this all began can be found here

Re:Not really adding anything important but...

[Uncle Focker]

And the same could be said when reselling books, movies, cds, etc. But it's been ruled we have a right to resell such things and it's about time the same thing was clarified for software. It's a shame if the company goes under, but they don't have a right to undermine the rights of the users.

Re:Not really adding anything important but...

[ak3ldama]

how about if the little guy writes software, and everyone who buys it goes straight to ebay and resells it, without uninstalling...

then the little guy is out of business...

No, then maybe the little guy needs to reevaluate the price of his product (or levels and quality of support) since people are willing to spend considerably less to buy an unsupported version of the product from ebay. If people don't need or want support then he could look at selling his product for substantially less then he currently believes it to be worth.

Re:Not really adding anything important but...

[TheRealMindChild]

Their concern isn't actually piracy in this regard. They don't want some CAD operator to sell a two-version-old-Autocad for $5 to someone who needs a CAD package. Instead they want that person who needs it to spend multitudes of money on a brand-spanking-new copy.

Re:Not really adding anything important but...

[sm62704]

Not hardly. My PC recently died (I mentioned it in the other thread today) and I dragged an even older one from the basement. Now, I'd like to put my hard drives, wireless mouse and keyboard, video card with its S-Video so I can plug the TV as a monitor, etc in it.

XP is going to say that it's a different computer and refuse to run more than 30 days. It has a EULA that slashdotters say is a legal document (although I never signed anything) to back it up.

I fail to see how this court ruling benefits the user. As Agent Smith said to Neo, "what good is a phone call if you're unable to speak?"

Re:Not really adding anything important but...

[mikael]

You give the software away for free, but you charge a free for a license key (eg. Microsoft) that unlocks various features of the software. For potential customers, you provide edit and load functionality. For students, you allow all the edit, load and save features, but any printed files have a watermark copyright. For professional users, you provide all features.

Re:Not really adding anything important but...

[thtrgremlin]

Isn't that the same (fallacious) argument for gun control where they justify taking guns away from law abiding citizens because criminals use guns too? Or blocking all p2p traffic because sometimes people use p2p to transmit copyrighted material outside the copyright holders intended desires?

And people actually make fun of Singapore for their anti-gun laws?

Companies and consumers are going to find ways to break the law, that doesn't mean their rights to do legal business should be changed in unnecessary ways. How do you justify that?

Re:Not really adding anything important but...

[Mister Whirly]

I know this isn't the point you are trying to make, but call MS and explain to them what you are doing. They will issue you another key with relatively few hassles. I have done this a few times in the past and have had nothing but helpful MS employees who have issued a new license key with minimal questions involved.
And no, I am by no means a MS fanboy, just relating my real-life experiences with MS keys and hardware changes.

Re:Not really adding anything important but...

[orasio]

Kudos for inventing shareware!! (Not that I like it)

Re:Not really adding anything important but...

[thtrgremlin]

Agreed. Restricting access to alternatives is a "good" way to force customers to buy more than they need. I once went to a club/resort place and was informed that membership was some $500 initiation and $1800 per year, or there was an upgrade for some $600+$2000/yr. Quite a bit more than anticipating, but after investigating and looking through the contract, turned out they had a $50+$30/month ($360/yr) student package and a "standard" package that wasn't much more. They had been trying to sell me their premium and platinum packages that had amenities that I didn't even want.

I think I have heard of some OS company doing some stuff to hurt competition in their favor too. :)

Re:Not really adding anything important but...

[ConceptJunkie]

I have to agree. I'm no MS fan either, but in the case of getting XP activated on new hardware (i.e., transferring it to a new machine), I've never had any trouble. When a phone call was needed, it only took a couple minutes and was easy and straightforward, no hold times or anything.

As much as people whinged and complained about how awful activation was when MS first introduced it, I've never had a problem or hassle because of it.

I will go out of my way to find reasons to criticize MS, but in this can, I cannot.

Re:Not really adding anything important but...

[digitrev]

On the topic of switching hardware...I bought a Dell computer a few years back. Came with a nice OEM copy of XP, some crapware which I quickly cleaned off, and nothing else. Over the next few years, I replaced a CD drive with a DVD drive, replaced the RAM, and added an extra internal hard drive (which required cannibalizing parts from another computer because the damn built in IDE cable only had room for a master, no slave). Then, just this past winter, I bought a motherboard, RAM, CPU, and case. I backed everything up, transfered over my hard drive with the copy of XP on it, and the CD drive, and couldn't get the damn thing to boot. So I called up Dell, they sent me a CD with XP on it, and installed it using the license key included on my old box. No hassle whatsoever, even managed to install it without the crapware. McGrew, try calling up the people who built your computer, they'll probably be more than willing to help you out.

Re:Not really adding anything important but...

[drinkypoo]

drinkypoo the human dictionary says: the word for features-limited-until-paid shareware is crippleware. It's not very P.C., but it is very descriptive. Fight crippleware: use Free Software! (I understand some of you out there make a living on Shareware. Good for you! I hope when you abandon the software you'll Open the Source.)

Re:Not really adding anything important but...

[sumdumass]

This isn't a matter of keeping a copy. US copyright law already states that if your going to sell your copy of computer software, you have to sell all copies of it.

The laws covering computer programs Section 117 a 1 and 2 say that you can make a copy of the program as an essential step in using it (a fancy wording for installing it) and that you have to destroy or transfer the copy with the program is you sell it.

(a) Making of Additional Copy or Adaptation by Owner of Copy.-- Notwithstanding the provisions of section 106, it is not an infringement for the owner of a copy of a computer program to make or authorize the making of another copy or adaptation of that computer program provided:
(1) that such a new copy or adaptation is created as an essential step in the utilization of the computer program in conjunction with a machine and that it is used in no other manner, or
(2) that such new copy or adaptation is for archival purposes only and that all archival copies are destroyed in the event that continued possession of the computer program should cease to be rightful.

So in the case of the little guy, or any guy, keeping a copy of the software without the copyright holders permission is still a violation of copyright. With this ruling, no one can install a copy of software then sell the product on ebay without removing it from their computer first. The little guy needs to do nothing because he is still in as much control of his work as the copyright law originally allowed.

Re:Not really adding anything important but...

[Lijemo]

how about if the little guy writes software, and everyone who buys it goes straight to ebay and resells it, without uninstalling...

then the little guy is out of business...

Um, where are you getting the "without uninstalling"? That has nothing to do with this case or TFA.

This court case says that if I buy a copy of Windows Office and decide I don't like it, that I can uninstall it and sell it to someone else. Previously, software companies had been trying to claim that even after uninstalling the software and destroying every backup copy, you still couldn't sell the original CDs.

Re:Not really adding anything important but...

[Anonymous Coward]

I'd wait until we see what their policy on new keys is, after they're no longer selling XP.

The number one problem with 'activation' is that you are completely at their whim with regards to how reasonable they make things, and they can change their policy at any time they like.

In a year or so, that formerly-hassle-free call to Microsoft for a new key might very likely be met with a polite refusal and a pitch to upgrade to Vista.

Re:Not really adding anything important but...

[Anonymous Coward]

I work as a designer for a small firm. I was formerly a draftsman before i got my BS in ME. I can tell you with 100% confidence that AutoCAD 14 is of no use to anyone. Ever.

Architects will have a fully-updated copy of Architectural Desktop, while most machine shops will already have a 3d solid modeling package that supports coordinate systems that CNC cabs, etc. can interface with.

The guy who bought the software off of ebay was probably a kid in high school taking a "technology" class. It'd make sense that the same kid who got a deal on an old version of crappy software might end up as an engineer some day and be responsible for sourcing a CAD package for his employer.. Good think Autodesk nipped that in the bud before they saw another batch of site licenses.

Honestly, I don't understand why companies chose to pick such terrible battles. Any shop that operates with pirated CAD packages will already have the latest version fully cracked--in their native language to boot. (I'm looking at you, China.)

Re:Not really adding anything important but...

[story645]

Some of us don't have much of a choice, if any. Visual Studio is one of my least favorite compilers, but if the professor's giving me code that compiles in VS and requires a hell of a lot of work to compile in anything else-well VS it is.
MatLab is the same, 'cept funner 'cause it's got it's own proprietary language and I had two classes that used it. And then there's this horrible suite for psych experiments called Presentation-that's what the person running the experiment was using, and had no authority to fight him on it. Of course I can do almost anything I need MatLab or Presentation for in python, but that requires forcing people to switch and learn new techs.

Re:Not really adding anything important but...

[bar-agent]

AutoCAD is used for more than just architecture, for example, designing refrigerators or machining.

Re:Not really adding anything important but...

[hemp]

If AutoCad 14 us completely worthless, why are they initiating an expensive lawsuit to prevent its resale??

Re:Not really adding anything important but...

[iq in binary]

*Ahem*

NO ONE* is designing in 2D anymore. Creating isometric and orthogonal views? What a complete waste of time.

You must be one of the idiot engineers that I have to deal with on a daily basis that thinks I can pull GD/T out of my ass from a 3D model.......on a 2D piece of paper. As a machinist and engineering student, I see all this idiocy all the fucking time. EVERYTHING you design has to be manufactured, and the most important part of the manufacturing process is the measurement, the tools for such making up 3/4 of a machinist's toolbox. What you should be saying is that nobody is NEEDLESSLY designing in 3D. The majority of parts you will see as an ME will be rather simple, and much easier to design in a 2D environment, and MOST importantly, easy to read by the manufacturing staff that is going to fabricate them. Yes, there are contours and surfs that need to be designed in a 3D environment, but that is a tiny minority. The most prevalent CAD/CAM package on the market is primarily 2D with a robust 3D package that can be used (albeit painstakingly) to render the odd surf here and there.

Isometric and orthogonal are there for a reason, they're going to be the basis from which the part is manufactured. So unless that fuzzy-bunny-lala-land in your head comes to fruition any time soon, you're going to need them. At least, if you've even learned basic blue-print reading. The most common recurring problem I've seen with prototype and small run manufacturing is that the engineer isn't even drawing up the blueprint. Nine times out of ten he doesn't even know how. He designs the part and some poor CAD-Tech transfers it to a block blank, inevitably making mistakes along the way, and %90 of the time making the part more expensive by virtue of setting tight tolerances where they don't need to be. The %10 of the time the ME does know basic blueprint reading, he still makes the part needlessly expensive because he never spent any time doing assembly, and thinks that he needs bolt hole locations within .001".

This "New-School" elitism of yours is the reason a kid like me--who is working the old-school to get into the new-school--is going to be your boss, making twice your salary, at half your age. Old technology is not bad as long as it's proven.

Re:Not really adding anything important but...

[jonniesmokes]

As an ME who graduated in 1996, I saw it all. I did an immense amount of work in Acad R12-14 in 2D and learned all the tricks to build the orthogonal and isometric views. Soon, ProE and SW hit the scene and I had to spend nearly 1000 hours in each learning how to build models and make decent 2D drawings. It was hammered into me from my mentor, that the drawing is a contract and that it alone can convey intent.

On a whim I took an architecture class and learned to use a mayline and paper/pen/pencils to do the same 2D tricks I had done in Acad and Vellum. Weirdly enough, my first real engineering position was at a shop that used hand drawings with a mayline. Productivity was low, but very few mistakes were made.

I later worked in a Pro/E shop and designed plastic injection molded parts, so almost everything was 3D. We still needed 2D drawings for documentation and there were a few projects with machinining and the intent still had to be put into the drawings.

It'll be a long time before 2D drawings are eliminated because they are the only open document format for making engineered parts. And they do a great job of conveying intent and contracting the job. That said, I really like parametric design, because you can update the location of a bolt hole in the assembly and it goes all the way through to the 2D drawing. What used to take an hour or a day, now take seconds.

Knowing how to use your tools is just as important as having them. 3D programs are really great at increasing productivity, but if all you are doing is speeding up the design of something broken and expensive, then you are just getting nowhere faster.

Re:Not really adding anything important but...

[IpalindromeI]

Visual Studio is not a compiler. It's a development environment. The compiler it uses ("cl.exe") is included in the .NET Framework SDK, which is a free download. The linker is in there, too.

See this link for more info.

Re:Not really adding anything important but...

[Phil_at_EvilNET]

I'm glad you said it. I've been both a mechanical draftsman and an architectural draftsman and if anyone thinks for a minute that a carpenter wants to see some fancy, candy ass 3D drawing of a house on paper then you've never been a laborer or a framer, and I've been both. In my experience, tradesman, especially carpenters, want accurate, easy to read blueprints that don't have a bunch of eye candy. In the same respect, the guy setting up a steel coil slitting line doesn't give a damn that someone drew the slitter rolls in 3D. He's concerned that the slitter, flattenter, stacker, shear, etc. are all lined up properly. They want flat plans for this. 2D plans. 3D, IMO is great for modeling, great for design theory, and great for places that use CNC machining and like all things there's a PLACE for 3D, and there's a place for 2D. Anyone that thinks 2D drafting is obsolete or outdated has probably never gotten their hands dirty either.

Workaround

[Anonymous Coward]

Can autodesk skirt this by making its software connect to an autodesk server and validate the presence of a (non transferrable) user account?

Because that is exactly what World of Warcraft (and all MMO's, for that matter) does.

Autodesk would then give the software away for free, but sell the user accounts for whatever they want.

Re:Workaround

[FooAtWFU]

The difference is that World of Warcraft has something interesting on its servers. With Autodesk, all the really interesting stuff is on the desktop. As such, it's much less trouble to hack Autodesk to play for free than to hack MMORPGs (not that this has stopped a few random free "shards" showing up in various spots from time to time, game to game).

Re:Workaround

[Gat0r30y]

I suppose they could, but many folks are going to want to work in AutoCad without an internet connection. It would make a little more sense to stick a license on every box of software - and on install associate it with a user account. Even that though probably isn't optimal - considering many companies just have a license server for such programs.

Re:Workaround

[egburr]

I would hope it is the other way around, that companies (such as Blizzard for WoW) would no longer be allowed to prohibit the re-use of the keys that come with the software. Since the key is what allows the software to be used, the software is useless without the key. Since the key is part of the software package, it should be usable by the rightful owner, whether that is the original owner or the second owner or the third owner, and so on.

Skirting this by saying the key allows you to create an account and that the account is non-transferable is bogus as long as the key can only be used to create only one account.

I did buy a "like new" copy of WoW on ebay a couple years ago. I was a bit put out when the key was rejected due to having already been used. After reading the EULA thoroughly (not that I agree to a unilateral after-purchase change of conditions), I argued with Blizzard about my non-working key. After talking with a lawyer friend, and him sending them a letter, they sent me a new key.

One of they key points in their EULA was the paragraph:
You may permanently transfer all of your rights and obligations under the License Agreement to another by physically transferring the original media (e.g., the CD-ROM or DVD you purchased), all original packaging, and all Manuals or other documentation distributed with the Game; provided, however, that you permanently delete all copies and installations of the Game in your possession or control

The key is part of the "other documentation" and must be transferred to the new owner. Preventing someone from using it just because they are not the original owner of it is contrary to the first-sale doctrine.

Furthermore, there is nothing in the EULA indicating any possibility that the key cannot be used by its rightful owner. The only place that is mentioned is the Terms of Use which are displayed when you go to use the key. Prohibiting subsequent owners from using the key completely destroys the intended use of the software, so should not be allowed as long as first-sale doctrine principals apply.

Re:Workaround

[Dachannien]

Reusing the key would require that the previous owner relinquish the key from their account. It's apparent that the previous user, um, neglected to do that before he sold you his copy of WoW on eBay.

On a side note, I have this bridge I'd like to sell on the cheap. Interested?

Re:Workaround

[Experiment 626]

Wow software is free, and always has been. YES, you pay for the pretty book and the pretty package, but you can always just borrow your friends for the install instead. Where you pay is for the account on their servers.

You can install WoW from your friend's disks, but when you go to create an account, it makes you enter your own CD key (plus the key for any expansion you want to activate). They could remove this requirement and it would indeed work as you describe, but for now Blizzard expects to get money for both the software and the account fees.

Re:Workaround

[thtrgremlin]

I really hate companies that operate on the basis of "we will stomp the rights of every customer that doesn't sue us" policy. Lots of places seem to be like this. Some often just break the law till you point it out to them, then they change it... for you, and will keep screwing the person right next to you. I actually got into an argument with a McDonald's manager that refused to give a 6 year old kid a free cup of water (he bought a lot of food for himself and his friends at the same time). The manager said that the only water they had was the bottled water, and it was $1.50. I informed the manager that I knew they were lying and knew the law, and I would be more than happy to call the Health Department if they didn't get the kid his cup of water... in so many words. In California, at least, restaurant, for a variety of reasons, must provide water with no charges or restrictions, other than there is no regulation on cup size, customer or not. Kid got his water, and he thanked me.

Shame on them picking on a little kid for not knowing his rights. Now I think they just try to convince adults that anything but bottled water is poisoned or that only poor people drink water.
Idiots!

Re:Workaround

[terrymr]

Not really because the first months play is included with the purchased game. This is in addition to any trial period you may have obtained when you installed the software.

Re:Workaround

[KDR_11k]

Did you read the EULA when you bought them? There's a paragraph on resale, you have to tell Valve to unregister your key and pay a handling fee, then you can give the key to someone else (if you can convince the buyer that the key is indeed unregistered is another matter). Or well, at least that's the Half-Life 2 (retail) EULA, I haven't bought any games on Steam yet.

Re:Workaround

[Phrogman]

Actually, its not a CD key with most MMORPGs, its an account key that you get. I can install any of the MMOs I have on any computer I want, but I have to have an active account (determined by my registering the key the first time I play the game) to do so. If you have City of Heroes/City of Villains, Star Wars Galaxies or Age of Conan on your system, I can use your computer to log into my account and play any time. When you buy MMO software, what you are buying is the license key for an account, plus any other stuff that came with the box in the way of manuals, maps, in game bonus items etc. The contents of the CD are there but not tied to the account directly in any way. Since you *MUST* log into one of their servers to play the game, this system is enough in the way of security in most instances. The only problems come when someone manages to find out how to generate their own keys, in which case they may register their account with the illegitimate generated key before you can do so, in that case the person who can send in the manual with the key on the back usually gets awarded the account.

Re:Workaround

[TheGavster]

At least the site license sold to the local technical school near me requires a dial-in to validate it the first time each feature is used. It presented an interesting problem for creating restoration images, as even after validating the install on the (internet connected) master machine, the (more restricted) user machines would periodically die as the user found a feature that the administrator hadn't used before taking the image (knowing of the scheme, the master machine was worked through a series of exercises before the image was made).

Re:Workaround

[lgw]

True reverse engineering, done without any cheating by hiring somneone who's seen the source code etc, should be protected. Blizzard has a right to copyright their source code, but not to prevent anyone from designing a different solution (from scratch) that behaves exactly the same.

Company's *don't* have some magical right to make a profit. Just because they spent money in developement doesn't mean they get to make a profit. There are specific rules on how IP is protected, and (legitimate) reverse engineering does not break copyright, patent, or trademark protections. Companies know what these rules are before they develop their product, and coming along later and saying "people behaving legally are hurting our profits, so please change the laws" is something we have *far* too much of rght now.

Now, of course, Blizzard can say "if you want to use our servers, we require that you use our client" because that's a contract negotiation for the online service, nothing to do with software. But if someone reverse engineers the sever, and offers their own game with original content, Blizzard doesn't have a leg to stand on.

Re:Workaround

[egburr]

See, I really disagree with this, as it basically implies that "any contract you ever sign is bullshit."

Where did I say that? There is no contract. At most, there is a EULA which is non-negotiable and is not even presented until after the purchase is completed. A contract is a documented agreement between two parties for an exchange of money, goods, services, etc. The EULA is not even presented until after that exchange has been copleted. How can it be a contract?

If you install a piece of software, you click through an agreement. You are party to a contract(-ish thing, to get technical).

No, I click the let-me-use-what-I-have-already-paid-for button that is labeled "agree".

If one of the clauses is that you cannot resale the software, and you have agreed to that clause, then why do you all of a sudden feel entitled to sue because you should be able to resell the software (when you agreed that you wouldn't per the contract)?

You didn't read my post, did you? Why are you responding to it? Did you miss the paragraph about the EULA explicitly stating "You may permanently transfer all of your rights and obligations..."? Isn't one of my rights the ability to use the key that is part of the package?

Don't give me bullshit about how you didn't see the license until you bought the software, because you can still return the software if it's not been installed yet. It's the law.

The bullshit part is the part about returning it. Most stores will not accept returns of opened software. Mail-order stores will not pay shipping for the return or refund the original shipping cost even if they were to accept the return. It's not the law; it's a provision of the EULA which the vendors were not a party to.

I just got done with a software licenses class at my law school (wrote my paper on open source licenses, actually), and while I may not like the terms of these clickware license agreements, in my opinion they are valid and we should follow them or stop buying the software / return it and let the companies we don't like how they do business.

That's your opinion, good. My opinion is that they are only as valid as we allow them to be. They are unconscionable, primarily because they are not presented until after the sale is complete and attempt to impose conditions and restrictions that were not agreed upon at the time of the sale. Making it unusable by not accepting the EULA after I have purchased it and installed it has wasted my time and money. Those conditions and restrictions should be presented in full at the time of the sale.

Thoughts? I'd love it if there were some argument to make me switch sides on this issue, as I really want to be on the other side, but I don't think the better arguments are on the other side. I think they're on the side of "obey the terms of the contract."

In general, I'm on the side of "obey the law". I don't know where exactly the law stands on this yet. A EULA is not law. A EULA is a post-sale unilaterally imposed non-negotiable statement of restrictions and conditions with the appearance of a contract that must be agreed to in order to use what was already purchased. Contract law may be relevant to this, but first we have to determine if a EULA really is a full-fledged contract. My opinion is that it is not.

Re:Workaround

[rlk]

Mr. Vernor never installed (those copies, at any rate) of AutoCAD, and so never agreed to any license. If the company that sold those copies to him violated its license, that's between AutoDesk and that company, but not Mr. Vernor.

And license violation doesn't automatically mean copyright infringement, either.

Re:Workaround

[rlk]

But that's what this whole thing is about -- AutoDesk has been sending DMCA (i. e. copyright) takedown notices to eBay over Mr. Vernor's attempts to sell copies of AutoDesk whose license he never agreed to in the first place.

The First Sale Doctrine *is* also law, and contracts and agreements do have to follow the law.

Re:Workaround

[egburr]

The requirements you're implying should be imposed on contract and licensing law with these statements are staggering. You're basically demanding that all agreements be completely performed in person simultaneously or else they are unconscionable.

No, I'm suggesting that the terms of the contract should be agreed upon before the sale is completed, by which I mean money changing hands and me leaving the store with the item I purchased. Anything after that point is unreasonable.

Hell, the current regime still permits post-purchase refusal and refund, but what you're suggesting would make it worse for the average consumer.

Yes it does, but they make it difficult to get the refund, they make it time consuming, and you usually don't get a complete refund, even if you don't count the time wasted. It may make it worse for the average consumer in the short term. In the long term, outrage over that would likely cause the publishers to reduce the contracts to the minimum possible and present more reasonable terms that both parties agree with. As it is now, most people click the let-me-use-what-I-purchased button whether they agree with (or even read) the EULA or not.

Finally, the time of the sale is not the end of the license formation process, and it does not have to be. Again, how do you think people in faraway lands have done business for decades? By mailing contracts back and forth, and including partial performance as part of the deal. You buying the software is partial performance of the agreement. Later, when you click "agree," that's the rest of the performance. The agreement is not finalized until you've fully performed. It's basic, black-letter contract law.

There's a significant disconnect then. I consider the agreement complete when I say "I'll give you this money for that item" and the cashier says "done". The piece of paper hidden inside the box is not part of the agreement; that is something that comes after and says "you can't use this thing you've already paid for until you agree to our amendments to your purchase."

This has never been a valid argument for why a contract or license is crap. Consider this: you read a contract before signing it. You decide you don't like it. Do you now get to say all contracts are unconscionable because they waste your time since you have to read them?

The waste of time is the change of the terms of the agreement after the sale is complete. I have completed the purchase. I have returned home. I have installed the software. Only then is the EULA presented. If it had been presented at the time of purchase, so I could consider it then, if I should decide the EULA was not acceptable I could walk away right then. Now I have to uninstall it (in some cases), return it to the store, convince customer service that the EULA says I have the right to a refund and that they have somehow agreed to that EULA. For example, I spent considerable time reading through all the contracts when I bought my house. The contracts were signed before payment was made. The same is true for my car. I did not consider that time wasted. In both cases, after the sale is complete, nobody came running up denying me entry to my house/car until I signed an extra contract that had not been presented and agreed to before the sale completed.

Re:Workaround

[egburr]

And before you say that the company could make the license agreement available online so the consumer could read it before going to make the purchase

I wouldn't suggest that. I'd be even less likely to purchase something if I had to run home to read the contract, then come back. I just want all the contracts to be presented up front before the purchase, so I have the opportunity to read them before the sale is complete. And specifically that anything not in those contracts will NOT be presented later as a requirement for being able to use what was purchased.

Re:Workaround

[rtb61]

Quite simply to cut though the BS no contract, absolutely no contract can infringe upon statutory law. Lawyers are quite capable of utterly invalidating any contract that has just one clause that infringes upon statutory law, at which point all the conditions of contract revert to default general conditions of contract and any ambiguities will go against the party that wrote/supplied the contract.

So first sale doctrine under copyright law is a statutory law hence you can not write a civil condition of contract that will infringe that law, you can of course still do it but, when challenged in court that contract can then be voided.

When it comes to computer games it does make it very interesting fro a bunch of companies that only allow one of a registration of the game or a limited number of installation possible, as that does infringe upon a person right to sell the game when they no longer want it.

Currently the real problem is that government consumer protection authorities are completely failing in their duty of responsibility in ensuring a lot of this crap is nipped in the bud, in actively prosecuting companies that write criminally deficient contracts. Corrupt governments pandering to corporate interest have stripped away all power from consumer protections authorities, so that corporations can write criminal contracts and then force consumers who want to challenge them, to spend large amounts of money in court in order to do so.

Re:Workaround

[ajs318]

No. Statutory Rights are sacrosanct. You cannot waive them. If you sign a contract that says you are not going to do something the Law of the Land says you can do, you can go ahead and do it anyway and not be found in breach of contract.

For example: using an object that employs someone else's patent is infringement, but if they give you a license to use the patent, then they have waived the right to sue you (even though 35 USC gives them the right to sue you for it were it not for the license).

Bullshit.

They have not "waived their right to sue" or anything like that. Patent law states that certain acts require advance written permission, and a patent licence is exactly that permission. Their right to sue never existed in the first place.

Re:Workaround

[Sj0]

The requirements you're implying should be imposed on contract and licensing law with these statements are staggering. You're basically demanding that all agreements be completely performed in person simultaneously or else they are unconscionable.

According to my sources, duress is defined as a "threat of harm made to compel a person to do something against his or her will or judgment; esp., a wrongful threat made by one person to compel a manifestation of seeming assent by another person to a transaction without real volition."

It seems to me that threatening to 'take back' software that has already been bought and paid for if you don't accept some new contract after you've already agreed to a common sense implied contract of "I spend this money, I own this software and, by natural common sense extension, the right to use it for it's intended purpose on my PC" is using a wrongful threat of harm to compel a person to 'click through' this agreement.

The wrongful threat of harm increases with the cost of the software or device involved. If you bought a brand new $10,000 alienware PC only to not have use of it because you don't like the EULA of Windows Vista, basically Microsoft is holding your $10,000 computer hostage after you've paid for it with the implicit, common sense contract of "You've spent $10,000 on a new computer including Windows Vista, that price includes the cost of licensing and media, you have the right to use your new computer"

By contrast, the GPL doesn't hold but the right to distribute modified software, which you never had any other right to, implied or otherwise. Even if you paid for the product, copyright law implicitly protects all copyrighted software from redistribution in any form without the contract.

Hell, the current regime still permits post-purchase refusal and refund

The current regime does NOT permit de facto post-purchase refusal and refund, becuase software retailers don't allow refunds on opened software, and computer vendors don't have a system in place for a reasonable person to recieve a refund for software they have declined to accept the EULA for. There is no reasonable ability to refuse the contract, because it requires going to extraordinary lengths like these. This man was denied a refund three times.

Good lord, almost every freaking consumer product you buy now has licenses included.

You'll have to point to examples. I've bought a lot of things over the past couple years, and the only thing that's come with a contract is software.

I've bought a truck, it came with no EULA. I've bought a skidoo, no EULA. I've bought dishes, pots, pans, and no EULA. I've bought furniture. No EULA. Got a great deal on a Queen size bed. No EULA. I've bought a wireless phone, and while it came with a piece of paper clarifying it's status under the appropriate laws regarding it's creation of interference which could affect other devices, but no EULA. Barbeque, despite being a dangerous gas appliance, no EULA. Propane for the barbeque, despite being an extremely dangerous substance which can't be dispensed without a proper license, no EULA.

I've even bought 3 cellular phones, 2 pay-as-you-go and 1 regular, and while I had to sign a contract before they'd accept my first payment and give me service for the regular phone, I didn't have to spend 2 seconds looking at a EULA, because there was none -- and there was none for the pay-as-you-go phones at all.

The only thing I've bought that has come with a EULA or equivilent contract to be agreed to after money has changed hands under threat of denial of service is software.

I'm sure there's contrary case law, but that's a failure of the legal system. Far too many geriatrics will accept a ridiculous legal arguement because the phrase 'on computers' is thrown in front, and that's going to be a roadblock for younger, less ignorant lawyers and judges as they transition into positions of judicial authority over the next decade.

Autodesk = a true evil empire

[Anonymous Coward]

Those of you who have not had to deal with their software and their heavy handed approach to licensing and upgrades are lucky.

Re:Autodesk = a true evil empire

[TheRealMindChild]

I can surely attest to this. While in school for CS, I was a junior administrator in the MIS department, doing things like... well, everything that went wrong on the computer network. We dreaded when anything went wrong with Autocad. It was a bloody nightmare. Dongles would just stop working and their customer support would pretty much tell us that we were lying and trying to pirate the software. And it was like talking to a brick wall. No amount of sales receipts or serial numbers mattered. They didn't even care. Their solution every single time was to "Buy a new copy".

On top of that, upgrading almost never worked. It got to the point where an upgrade to Autocad meant loading up a new system image, then installing it first before anything else.

Re:Autodesk = a true evil empire

[sumdumass]

Interesting. I just moved a copy of Autocad from a windows 2000 machine to an XP laptop that was replacing it. I had to call and validate the license key for an activation code because the old one wouldn't work in the new OS. They gave me one no problem. They asked if I removed it from the old computer yet and I told them I couldn't do that until the new computer was totally functional.

That was for a county (government) office though. The licensing might be different elsewhere or they could have changed their procedures somewhat. However, we don't have any special government contracts that I am aware of with AutoDesk. I suppose I could check with the commissioners office to see if they billed us for a new license or something. But I don't think they did. At least I didn't authorize anything like that when on the phone with them. The subject never came up. I found dealing with them far easier then dealing with MS and their activation. MS attempted to tell me I had to buy a new OEM version because I replaced a dead hard drive with a different brand drive in a system once. After about 2 weeks of that, they reactivated XP and Office for me.

It would be interesting to see what is so different that caused totally different impressions of the same company.

Re:Autodesk = a true evil empire

[coats]

This is exactly the situation the judge's ruling doesn't cover: he said that if there's some kind of re-possession, it is a license; if not, it is a sale (and gave the relevant Ninth Circuit precedents). Ceasing to work after the license-term amounts to re-possession; Autocad doesn't do that, so it was a sale.

What about the ebay account?

[Nichotin]

What I could not figure out from the article was: What happens now to his ebay account? If it was pulled, I hope ebay restores it. Bugs me that ebay, google, youtube etc. always gets away for enforcing bogus claims. I did RTFA, but please enlighten me if I have missed something.

Re:What about the ebay account?

[phpmysqldev]

This article goes into more detail about that. Apparently his eBay account was restored (and good thing, I would be livid if I had a 10k+ feedback powerseller account taken from me)

Antiquated Thinking

[ouvyt]

AutoCad aggressively attempts to make itself irrelevant. Why generate such bad press over a single copy... This follows the same backwards mentality of the book publishing industry, which thinks the less books in the hands of people the better.

Re:Antiquated Thinking

[qoncept]

People don't use AutoCad because they like the company behind it, they use it because they've decided it's the best tool for the job. The people using it cost a whole lot more than software, so you give them what will make them the most productive.

Re:Antiquated Thinking

[ouvyt]

I agree. Thinking about it from the perspective of the potential buyer, AutoCad is making it difficult to purchase their software. It has been chatted about in the past how locking down software just encourages people to find alternative solutions to getting a copy. In this case it isn't a software lock, but a legal lock. Either way the result is creating a black market that didn't necessarily exist before.

Re:Antiquated Thinking

[rahvin112]

Smart people switch to Microstation and stop using AutoCADD after they have a bad experience. Bentley is a far better company to deal with, a company that produces better software IMO, has better support and actually cares about their customers.

Psystar

[oahazmatt]

A bit off-topic, but I'm wondering if Apple was actually waiting on this ruling before going after PsyStar for OS X.

Re:Psystar

[drinkypoo]

You can not photocopy the book, leaving the book in tact, modify the copy then sell that copy, even if it's bundled with the book.

Ah, but keep in mind, the software publisher is claiming not that you are buying a piece of software with which you can do whatever you want, but a license to use a piece of software. This decision says that that license is transferable. And first sale law already said you could make modifications and resell something.

Psystar is buying a license to install the software; they are doing so. They are then modifying the software, which is their right. They then resell the system, and responsibly transfer the license along with it. Reselling the system is within their legal rights; reselling the software has now been shown to be within their rights as well. Modifying the software is also within their rights. They are not representing the software as unmodified, so they are not committing a breach of trademark law. I'm not clear where you think the violation lies.

Likewise in Finland since a number of years

[vinsci]

A similar ruling is in effect in Finland since a number of years. The case was vs. Microsoft, decided by the supreme court that reselling MS Windows licenses is perfectly OK and Microsoft can't stop it. Don't have the reference handy, sorry.

Re:Likewise in Finland since a number of years

[Sique]

Same in Germany. Google for "Microsoft" and "Snogard".

Re:Likewise in Finland since a number of years

[vinsci]

I think it's this one: http://www.finlex.fi/fi/oikeus/kko/kko/2003/20030088 (I don't have time to verify it, though).

A commentary on the case: Ostajalla oikeus myydä ostamansa tietokoneohjelman kappale edelleen — KKO:n ratkaisu levittämisoikeuden raukeamisesta (Rough translation: "Buyer has right to resell the copy of a program he has bought - Supreme Court decision on the ending of distribution right").

All the companies involved were: Adobe Systems Incorporated, Autodesk Incorporated, Borland International Incorporated, Lotus Development Corporation, Microsoft Corporation, Novell Incorporated and Symantec Corporation.

Re:Likewise in Finland since a number of years

[vinsci]

Another reference, this one in the trade newspaper Tietoviikko (literally "informationweek"): Lisenssi ei estä jälleenmyyntiä

Product Activation?

[nonsensical]

It's about the courts re clarified this for software. When you buy a physical product, you should have the right to sell it.

What happens now with all the authentication and tying copies of software to the hardware it's first installed on such as Windows XP/Vista?

You have a right to sell your copy, but effectively you can't because it's been tied to your hardware.

Re:Product Activation?

[Chris Burke]

You have a right to sell your copy, but effectively you can't because it's been tied to your hardware.

It seems to me that the courts have not typically ruled against "effective" rights violations*. There's no law that says Microsoft can't require your PC to phone home to verify it's using the same hardware as before. So while this decision could be repeated if Microsoft tried to stop you from reselling Vista and you went to court over it, it would probably not have any effect on that sold copy of Vista being useless because Microsoft wouldn't activate it.

* See Eldridge v Ashcroft, "retroactive finite copyright extensions, repeated infinitely" doesn't violate principle of copyrights being finite.

First-Sale cuts both ways

[Anonymous Coward]

I created a 4 hour video on building boats. I sell probably 30 a year. An online video rental site bought a legal copy and now rents my video out at $15 per week.

So why should people buy my video at $80 if they can get it for next to nothing on the web and most likely just burn their own copy? That's First-Sale Doctrine and it can also suck for the little guy.

Re:First-Sale cuts both ways

[icebike]

That act is specifically prohibited by the Copyright act. (At your discretion of course).

See http://en.wikipedia.org/wiki/First-sale_doctrine

Re:First-Sale cuts both ways

[Uncle Focker]

That rental company has no right to do that under the First-sale doctrine. If they are truly doing so you need to take action to stop them. It's funny that you tried to argue against the First-sale doctrine protections by providing an example of something that isn't protected by said doctrine. A rental company must have a contract with the copyright owner in order to rent out their copyrighted works.

Re:First-Sale cuts both ways

[Zanth_]

Despite that sucking for your wallet, I don't see why this is a bad thing. If you priced your video to match the $15 online price, you would likely sell quite a bit more. If you are selling the video on optical media then the cost is minimal for you. The main cost of course was in recording and editing your video. If you haven't made your money back selling at $80 you might want to consider lowering your price.

As for it cutting both ways, this is no different than an author of a text for a limited audience, say a quantum physics prof writing an academic text, or a post-doc releasing their thesis to the public. Chances are they won't sell many and the ones they do sell will mostly be picked up by university libraries. Guess what? A good amount of students will borrow the book for FREE!!! Yes that's right, despite the fact that the tome, written through blood sweat and tears, is available for a paltry sum of >$80, students and professors alike will more often opt to borrow it from their library rather than shell out for a copy.

They can even photocopy the book for a mere fraction of the cost!

Does this suck? For the author yes in a way, but there are a few ways to work around this:

1) having it in libraries and avaialable for free to faculty and students increases the number of people who will become familiar with the author's work. Likewise with you, having your video rented at $15 a pop is going to expose more people to your name and efforts than likely would have happened had you continued to sell 30/year. If you ever decide to write about building boats or doing a follow up vid or something different, you will be immediately more recognizable. If your work was good in the first place, you will have an immediately respectful fanbase who might be willing to buy those future works.

2)selling it cheaper. My thesis advisor's first book (a reworking of his thesis) sells for about $140. He's sold maybe 1100 in 15 years. It's not likely to sell many more as the relevance shifts in the field. He didn't control the price outright, the publisher pushed a high price on him. Had it sold for $30 instead, many more people would have bought it, he's been told by fellow academes. Of course at $140, they just borrowed it.

Sell your DVD directly for $15 and you compete with the video store. You offer folks a legal fully made up copy vs. their home ripped version.

If the video is a hot renter, your video will be a hotter seller.

Re:First-Sale cuts both ways

[Naughty Bob]

I created a 4 hour video on building boats. I sell probably 30 a year. An online video rental site bought a legal copy and now rents my video out at $15 per week.

So why should people buy my video at $80 if they can get it for next to nothing on the web and most likely just burn their own copy? That's First-Sale Doctrine and it can also suck for the little guy. Contact the video rental site. Send them an 'updated', Hi-Def version of your tutorial. Include on this a number of unobtrusive ads for your product, and maybe throw in a few free support calls (then start charging...).

(I know nothing about boat building, but...) If building boats takes more than 5 weeks, or is slightly difficult, you'll have successfully adapted your business model to (cue scary-deep voice over) 'A Business Model For The Digital Age'.

Kerching!

Re:First-Sale cuts both ways

[Uncle Focker]

This post clearly shows that someone doesn't understand either the First-sale doctrine or the reason why libraries can lend out books and movies for free. I suggest no one listen to the nonsense he put out. The rental company has no right under the First-sale doctrine to rent the person's video if they had no permission to do so. Since this rental company is also clearly not a library they are not covered under the same protections afforded to such institutions. The AC, if their claim is real, should use his status as the copyright owner to stop this violation of his rights.

Re:First-Sale cuts both ways

[stubear]

Actually First Sale only allows one to resell their physical copy, nothing else. If they want to rent it then they have to enter into an agreement with you to do so. Copyright law protects you here. Ever wonder why rental late fees were so high? Rental stores pay (or they used to anyway; not sure how it works now) more for each copy explicitly for the right to rent the video and replacing them was expensive. The copyright holder gets more for these discs, though nothing compared to what the video stores could ultimately make for a new release, and video stores get to rent the videos. I'd suggest contacting a lawyer and proceed from there. You should be entitled to more per copy if they want to rent the video.

Re:First-Sale cuts both ways

[larry bagina]

They can resell it for $80, then buy it back one week later for $65.

Re:First-Sale cuts both ways

[jcr]

Do you think your local video store has a contract with all the movie studios?

Actually, they do. They buy their copies of the movies through a distributor who acts as the studios' agent.

-jcr

Re:First-Sale cuts both ways

[shawn(at)fsu]

I think they do. My sister used to work at a video rental store and I saw the catalog they used to order VHS tapes from. They were easily 4 to 5 times as expencive as buying it from walmart or what have you. This also led to fun times when someone would leave a video in their hot car in Florida and were shocked when told how much it was to replace the tape.

Re:First-Sale cuts both ways

[cfulmer]

Pardon?

      This is exactly the sort of thing you can do under the first sale doctrine. First sale exhausts the distribution right. (except for software and music. See Section 109(b)(1) of the copyright act.) And, renting is distribution.

Re:First-Sale cuts both ways

[pegr]

Actually, they do. They buy their copies of the movies through a distributor who acts as the studios' agent.

 
There is only one circumstance within which video rental stores have a contract (indirectly) with studios, and that's for PPT, or Pay Per Transaction. That is a voluntary agreement where the studios get a cut of every rental.

Otherwise, any legally owned copy of a copyrighted video work may be rented without any permission from the studios. My qualifications? I was an independent video store owner for 15 years, a long-standing member of the VSDA, and have worked with all the major distributors. I'm afraid you are completely and utterly wrong.

Apart from that, my slashdot UID is lower, my kids smarter, my wife prettier, and my crap smells like cinnamon rolls.

Have a nice day!

Re:First-Sale cuts both ways

[Zanth_]

Everyone needs protection so they won't get screwed. If the big guys get screwed it means the little guys will likely get screwed even more.

The problem is that the OP is complaining that someone is making money off of his work. If the video is popular and is successfully renting for $15 (which is not a cheap rental...most rental stores I know are less than $5) then how can selling it for about that price not be a win win?

Your speculation on volume consumer goods would work if there was a high production cost. The problem is that the OP already spent the money on making the video. If it was expensive to do, moving 30 units/per isn't likely to make his money back or turn a profit any time soon. If the video is being rented frequently, it would only need to be rented 160x. Figuring that renting is mildly inconvenient (having to return it via the post in this case and if the OP is right in his assumption that most people copy it, then that extra effort figures into the hassle/cost.)

Sell it for $15 and who knows how many will sell? Certainly those that would rent it for $15 would buy it for that cost or might even pay a premium of $5 over the rental cost to get it a pro copy.

It really depends on the rental volume in this case. If it is rented out 10x year, the likelihood of him selling 10 more copies at 80 bucks is pretty nil, but if it is renting out 200 times a year, then he is turning a larger profit matching or just slightly increasing the price.

Otherwise, I agree, niche and high quality products usually demand a higher price and often people are willing to spend the money on it. But when the product is a silver disc and that silver disc can easily be rented...one can understand why $80 vs. $15 is going to be dramatic on sales. In the end this argument totally depends on the volume of rental sales.

If the OP's copyright policy clearly prohibits renting, then he should either slap the online company with a cease and desist order or come to some agreement where he gets some form of royalty from each rental.

Re:First-Sale cuts both ways

[Anonymous Coward]

...and my crap smells like cinnamon rolls Uh. You might want to see a doctor about that.

Re:First-Sale cuts both ways

[JonWan]

The first video store I ever visited did this. You purchased the Tape for the retail price (about$80) and returned it for a refund. They deducted $5 for each day you had the tape. If you needed a VCR they would rent one to you for $10 per day plus a $300 deposit.

Re:First-Sale cuts both ways

[ratboy666]

Of course you can rent out movies. The Record Rental Amendment (1984) removed that right for audio records. The Computer Software Rental Amendments Act (1990) removed it for software.

However, neither books, nor videos fall into those categories.

However, it could be argued that EULA bound software (that was not purchased), is supplied to you via rental by other means. Clayton may then prevail, giving you the right to sub-rent that software. Then again, I am not in the US, and this may be wrong (any US lawyers want to comment?). I just think that you were a bit off-base.

Check with your lawyer, before you proceed.

Re:First-Sale cuts both ways

[tungstencoil]

With all due respect, I will have to agree with Cinnamon-Roll guy (my family, too, was involved with independant video rental business in the late 80s through the 00s).

Where I believe you are somewhat incorrect is that, in the catalog you saw, you saw prices higher on items not released for "general sell-thru". Recall back in pre-DVD days, many videos were available for rental only first (for a few months). This was because of the artificially high markup (around $100 a tape, circa 1998). Consumers simply wouldn't pay it. When the need for rental stores to buy 10 or 15 copies died down, it went to sell-thru. This was how the movie companies countered the rental market at the time. Interestingly, this was primarily brought about by the stores selling their used copied once the need to have a lot of copies of something died down. To the rental houses, the studios argued they had to make their money somehow, and it wasn't fair to sell a movie out for initial rental for just a few bucks and have it sold for nearly that much used.

Exceptions were made (think Disney or something that was thought to be a major-selling video, like "Titanic") - and for those that the consumer paid $19.95 for, the video stores paid about $15.

Agree: it did make for some fun explanations why that new release that baked in the hot (Michigan, in my case) sun in their car was $125 to replace, when they were used to spending $20 for a tape. It's all about the timing.

The germane point here is that they weren't paying a special licensing fee or anything to the studios (though, in later years, Blockbuster and Hollywood entered into "revenue sharing" agreements that allowed them to get a jillion copies of a movie) - they were simply paying an inflated price set by what was essentially a monopoly for a particular title: the studio.

Re:First-Sale cuts both ways

[pegr]

Public performance is a right outside of copyright and first sale. You are correct that I cannot exhibit a copyrighted film (video) work without permission, regardless of who owns the copy.

Public performance is a seperate right than renting, however. As an owner of a copyrighted work (except for phono recordings and computer software, I guess they have better lobbiests!), I can rent to whomever I please without permission of the copyright holder. Why you would confuse the two is a mystery.

Re:First-Sale cuts both ways

[kennygraham]

You're missing the point though. The video store can lower their price to $0.01 and still make a profit.

The guy who made the video had to carry all of the expense of making it in the first place. He didn't magically pull the video out of his ass and start selling it for some arbitrary amount of money. He deserves to be compensated for all the work he did to make it. And he can't do that when scumbags can take his end product, copy it, and sell it for half the price. [Emphasis added]

Strawman. Nobody's arguing that they should be able to copy it. But if you purchase ONE copy, you can rent that ONE copy out. When you get it back, you can rent it out again. Same for however many copies you purchased. If the video store wants to be able to simultaneously rent out 10 copies, they have to purchase 10 copies. Sure, having customers who have rights might cut into profits. But regardless of how big or small your business is, deal with it. * This unfortunately doesn't apply to music or software

Re:First-Sale cuts both ways

[geekoid]

when did you do that? IN 1998 they started getting a percentage.\
", the video store pays the studio a one-time fee of $2-$4 per videotape and then pays 40% of rental revenues. "

http://people.ischool.berkeley.edu/~hal/Papers/history/

Re:First-Sale cuts both ways

[denttford]

You know, google does know all. Nothing's so anonymous with a well crafted search.

This wasn't hard to find.

Re:First-Sale cuts both ways

[Knara]

In early 1998 content providers came up with a different model. In one variation, the video store pays the studio a one-time fee of $2-$4 per videotape and then pays 40% of rental revenues. This earns the store a profit per rental of about $2.25. (Figures taken from Said (1999).) With this sort of ``sharecropping'' arrangement, stores no longer have strong incentives to economize in video purchase, reducing the queuing for customers. In fact, this is the form of contract used in Blockbuster's ``guaranteed in stock'' promotion.

That was an example of Blockbuster's contractual arrangement with "content providers" so they could do their "guaranteed in stock" promotion without having to wait for distributors to have an item. By getting their copies directly from the content providers, they didn't need to hope that they could get the amount of copies they needed to back up their promotion without giving away lots of free rentals. In exchange, the content provider got some revenue from the arrangement. It is not a description of whether or not Blockbuster has the right to buy a copy wherever they want and then rent it.

Reading for context is a useful skill.

Re:First-Sale cuts both ways

[creysoft]

How can you not see the difference between renting and reproducing something? Of course you can't make prints of someone else's painting, just like I can't make DVD copies of Titanic and sell them on the Internet. You could, however, rent the painting out to a museum for 6 months. Or rent it out to your neighbor for one night for a party. The basic principle of copyright is that you can't duplicate someone else's work without their permission. You can loan it out, rent it out, shoot it into space, burn it, or attempt to have sex with it, but you can't copy it. There are a few other things you can't do, such as public exhibition, or creating derivative works, but renting is NOT one of the restrictions. Except for phonorecord and software.

Re:First-Sale cuts both ways

[Mr. Beatdown]

There seems to be a rampant misconception here on Slashdot today, So I'm posting this a 3rd time.

For more clarity, The actual cite USC Title17, Chapter 1, Section 109 describes the situation where the owner of a copy of a lawfully created work may dispose of it, without the consent of the copyright owner. "the owner of a particular copy ... is entitled, without the authority of the copyright owner, to sell or otherwise dispose of the possession of that copy"

This is a clear exemption from the blanket rights granted to copyright holders, under section 106(c). Though 106(c) gives copyright owners "The exclusive rights to .... distribute copies or phonorecords of the copyrighted work to the public by sale ... rental, lease, or lending" these rights have exemptions.

The rights granted to owners of a copy, but not the copyright, to dispose of a copy by sale or otherwise are established. Rental, leasing and loaning are implicit in the "or otherwise" The rights do not extend to renting, loaning, or leasing computer programs or sound recordings because of 109(a)(1)(A).

IANAL, but that's the facts.

Re:First-Sale cuts both ways

[icebike]

> The rights granted to owners of a copy, but not
> the copyright, to dispose of a copy by sale or
> otherwise are established. Rental, leasing and
> loaning are implicit in the "or otherwise"

Sorry Mr. beatdown

The Record Rental Amendment of 1984 and the Computer Software Rental Amendments Act of 1990 both amended Section 109 to prevent all owners of software copies or phonorecords, except non-profit educational institutions or non-profit libraries, to dispose of said copies through the acts of rental, lease, or lending, or by any other act or practice in the nature of rental, lease, or lending unless authorized by the owners of the copyright.

You've got it exactly backwards. "Or Otherwise" is conditioned to explicitly EXCLUDES rental.

Open packet to read agreement.

[Hankapobe]

FTFA: There is a piece of paper tucked inside that says it is a licensing agreement with the statement "by opening the sealed software packet(s), you agree to be bound by the terms and conditions of this license agreement."

How many of you have found the actual license agreement is on the media stored in the packet? So in order to read the agreement, you have to open the packet.

If I understand this, in short...

[hyperz69]

The courts found you are allowed to sell your own property. Even if the person you bought it from says you can't. At least in the area where software is concerned ;P

Re:This is going to get to the Supreme Court

[whoever57]

There's no way Autodesk is going to let this ruling stand unappealed,

Autodesk might let it stand, since this is only a lower court verdict and they might consider it prudent to not get a appeals court verdict poking holes in EULAs.

Nontransferable Licenses in question

[icebike]

The ruling is important because it calls into question the whole concept of a Non Transferable license. The court found that âoefirst saleâ doctrine of copyright law did apply. http://en.wikipedia.org/wiki/First-sale_doctrine

If this hold, it will largely eliminate the non-transferable license in software.

And why shouldn't it? As long as the original owner retains no copy, selling an unused license simply keeps that copy under maintenance (maintenance charges frequently exceed sales revenue) and keeps the money flowing to the authors.

Nontransferable licenses are usually attempted by companies that have some sort of a near monopoly lock, so that not only do they gain from a new sale, they also gain from maintenance charges. If there are multiple vendors of equivalent software you really can't get away with nontransferable clauses.

As a software author, I'd gladly accept continued maintenance fees instead of new sales revenue. If my customers know that unused licenses have residual value when their projects are completed its good for me, and good for them. They buy extra licenses to handle the surge effort of development, and retain a few licenses for maintenance.

Re:Nontransferable Licenses in question

[sumdumass]

You know, you just brought up a pretty interesting observation. How would this Non Transferable license effect sarbanes oxley compliance? If there is no liquid value in a non transferable license, then as soon as a company purchases it, it ceases to be an asset of value. You couldn't list it as value towards bankruptcy either, I wouldn't think. But claiming $20,000 in computer software as an asset when if it ever needed to become liquid to satisfy debt or something, it would be worthless in essence might seem like a violation of some sorts.

Then again, if you file bankruptcy and dissolve the company, the company/person acting for the company who agreed to the license disappears. Would the Non Transferable license still be bound at that point? This case in question is a situation where someone purchased software at an auction (could very well be a bankruptcy sale) and didn't agree to any licenses before attempting to resell it on Ebay. If the software is confiscated from the company that agreed to it, is anyone but the company bound by the non transferable license anymore?

No lawyer

[lantastik]

Wow, that guy has some rocks. In the second link, you find out he sues them without a lawyer. That's not an easy thing to do in a US District Court.

Re:No lawyer

[daigu]

Actually, he started with no lawyer, then Public Citizen gave him some help. I found this information in a copyright blog by one of Google's lawyers mentioned further down in the responses to this article.

there is NO SIGNIFICANCE to this ruling

[Anonymous Coward]

I just read this article. The author has no idea what a summary judgment motion is, nor the significance of having it denied. Summary judgment motions are just long shot motions brought early in a case to try to dismiss it if there are no facts in dispute. The significance of a *denial* of such a request simply means there are facts in dispute, or the law isn't so clear. IT IS A NON-EVENT. Nobody has won -- the case simply proceeds.

Re:there is NO SIGNIFICANCE to this ruling

[Anonymous Coward]

I just read this article. The author has no idea what a summary judgment motion is, nor the significance of having it denied. Summary judgment motions are just long shot motions brought early in a case to try to dismiss it if there are no facts in dispute. The significance of a *denial* of such a request simply means there are facts in dispute, or the law isn't so clear. IT IS A NON-EVENT. Nobody has won -- the case simply proceeds.

Two basic points.

First, Autodesk was trying to get his lawsuit against them dismissed on the basis that he had violated the license agreement. The court ruled that his lawsuit could proceed, on the basis that copyright law gave him the right to do as he had done, and the license agreement should be ignored because it didn't agree (no pun intended) with the law.

As such, that could be a pretty big deal with respect to license agreements that disagree with copyright law (which is nearly all of them). Then again...

Point two: though I'm not sure if it figures into the court's reasoning or not, this appears to be a case where he had not agreed to the software licenses before he re-sold the software. If that's the case, that could explain (at least in part) why the court ignored the license agreement.

Finally, I'd note that when/if Autodesk appeals the ruling, the appeals court can only reverse the ruling if they find a clear error in the ruling from the lower court. If there's any doubt as to the validity of the ruling, the appeals court is supposed to give the benefit of any doubt to the lower court, and let the ruling stand.

Re:there is NO SIGNIFICANCE to this ruling

[gnasher719]

I just read this article. The author has no idea what a summary judgment motion is, nor the significance of having it denied. Summary judgment motions are just long shot motions brought early in a case to try to dismiss it if there are no facts in dispute. The significance of a *denial* of such a request simply means there are facts in dispute, or the law isn't so clear. IT IS A NON-EVENT. Nobody has won -- the case simply proceeds. You should have read what the judge wrote. In this case, there are no facts in dispute. However, in a motion for summary judgement the judge can only rule for the moving party (in this case Autodesk who asked for the summary judgement) and the case is closed and won by the moving party, or the judge can deny the motion for summary judgement and the case goes on. The judge cannot possibly, at this point, rule against Autodesk. However, in this case, the judge can use exactly the same arguments to finally decide the case against Autodesk when it is time to do so.

So true

[Weaselmancer]

I mean, look at how libraries have put all those authors and publishers out of business.

You can get the books for free there! It totally destroyed the book selling market.

Re:So true

[Uncle Focker]

And clearly Netflix, Blockbuster and Hollywood Video, etc have ravaged DVD sales!

Re:So true

[EnOne]

Can you imagine the difficulty of trying to create a library if they already didn't exist. Publishers, Authors, Printers, MPAA, RIAA... they would all try to sue you into oblivion for essentially 'giving away' what they rightfully own.

Re:So true

[Osurak]

Can you imagine the difficulty of trying to create a library if they already didn't exist. Publishers, Authors, Printers, MPAA, RIAA... they would all try to sue you into oblivion for essentially 'giving away' what they rightfully own. Yeah, seriously, thank $deity for prior art

Re:So true

[pdbaby]

Yeah, seriously, thank $deity for prior art Global symbol "$deity" requires explicit package name at comment line 2.
Execution of comment aborted due to compilation errors.
If only these people had typed "use strict;" before their religious texts :-)

Re:So true

[justthinkit]

Part of the reason that DVD sales continue is that Blockbuster and Hollywood Video stores almost never have the Special Edition for rent. Those who are real fans of a movie end up wanting the SE. Similar for Netflix where you get a single DVD at a time -- if you want that second DVD it is an extra request. And, if you kept the Netflix DVD of Hot Fuzz around long enough to listen to all six commentaries (on the Special Edition DVD anyway), you are probably spending more back-to-back-to-back -to-back-to-back-to-back time than you would like watching the same movie. In other words, it would work better for you to own the SE and watch it whenever you want, with whatever commentary you want. Ownership makes sense (at least it did for me).

So the boat building video guy needs to come out with a special edition. Make it longer, more DVDs, printed extras (and more restrictive or at least well-defined licensing terms in print and on-screen). For that matter, branch out into a related or new area, like backyard play structures -- we bought one of those -- a dealer "demo" at half price -- that still set us back almost $5K. There has got to be a way to teach people how to make one.

Re:Woot!

[uncoveror]

Indeed. Our personal property right to resell tangible things we own has been trampled on by vapor makers for far too long. First sale and fair use are the only things keeping patent and copyright from becoming a complete perversion of their constitutional purpose, which is ..."To promote the progress of science and useful arts, by securing for limited times to authors and inventors the exclusive right to their respective writings and discoveries; "

Vernor 'bound' by a license?

[Jason Levine]

I'm glad to see this was slapped down. From my understanding (from reading the article) is that Vernor obtained boxed copies of AutoCAD (through some legal means) and then sold them on eBay. AutoDesk was claiming that Vernor was bound by their software license agreement. Even if you accept the validity of a click-through license (a big IF, I know), how would he have been bound by a license that he never clicked "I Agree" to? In AutoDesk's reasoning, did his mere purchasing of the boxed software bind him to the license? I can see how a judge would laugh this out of court. At least with a click-through license, you can present the license's text. In a "buy the box, bound to the license" agreement, where would the license be presented to you? As you were about to pay for the box, would the Best Buy checkout clerk hand you a 10 page agreement to sign? If they didn't, then the license can't be binding (you need to be able to read a contract before agreeing to it), if they did, a lot of people wouldn't feel comfortable signing a big, legal looking document every time they picked up a piece of software.

Re:Vernor 'bound' by a license?

[Anonmyous Coward]

I wonder if this also applies to subscription services like DSL. I'm currently in the middle of resolving a dispute over a DSL early cancellation fee. Before I purchased the service, I asked for a copy of the license agreement. SBC said they didn't provide written copies of the agreement (At present, you can get them on the web, but you couldn't, or at least the salesman didn't tell me that I could at the time).

The salesman assured me that if I were to move before the 1 year contract was up and SBC couldn't provide service in the place where I moved to, I wouldn't be charged the fee. I did move to another state where they didn't have service 10 months into the contract, but they charged me the fee, claiming that because I moved to another state where they didn't operate, this clause didn't apply. (It only applies if you move to a place where they do operate but they can't provide service to that specific house for some reason).

Needless to say I called BS on them because I was never provided with a copy of the agreement and they certainly don't have my signature on anything. Unfortunately, consumers have no legal rights when it comes to a credit report. It's not considered liable because credit reports aren't public information. Anyone have an idea of a legal argument I can make that would force them to tell the credit agencies the bill is invalid?

Re:Vernor 'bound' by a license?

[db32]

You clearly haven't thought this out very well. What makes you think you could buy software from Best Buy anymore? Best Buy would have had to purchase said software to put on their shelf in the first place and thus be bound by this type of agreement. In this case I would have actually hoped AutoDesk would have won this nonsense. I could have made MILLIONS! I walk into court with a ruling in favor of this kind of draconian nonsense and a phone call to the BSA asking for my reward for reporting piracy on all of the software resellers. I get my millions and the software resellers are afraid to touch commercial software.

I mean, First Sale being defended is all fine and all but what really happened here is one of those giant self destruct events in the software/patent/licensing world of Imaginary Property was avoided. We need more of these insane IP implosions to succeed or we will never see large scale reform. You see, reform will never come from a sense of justice or rightness, it will come from economic motivations. Right now this IP nonsense is incredibly profitable, we need to make it unbelievably painful to get tied up in this crap and THEN the big boys will want to make the rules fair again.

Expect it to settle out of court

[Zontar_Thing_From_Ve]

Well, this is what happens when you go to court. You sometimes lose. Expect Autodesk to quickly settle this out of court with quite generous, but non-disclosed, terms to Mr. Vernor. I don't see how they can take the risk that an appeals court will uphold this, so I expect them to pay him a lot of money (maybe $100,000 or more) and have him agree to a non-disclosure of the settlement. The court case will be dropped and Autodesk will not admit to wrong doing and the ruling won't apply since they settled. This will keep the door open that Autodesk or some other company might be able to try a similar case in the future and get a ruling in their favor.

Re:Expect it to settle out of court

[compro01]

It has not been ruled upon. The author is clueless. They have merely been denied a summery judgment, which means this is going to trial, not that the trial is over.

The worst thing was ...

[Anonymous Coward]

If you read some of the other articles listed on the mentioned site, you'll learn that after he got each attempted sale pulled because of AutoCAD's DMCA complaints to eBay, and then restored (5 times!), he then got his entire sellers account frozen and not restored for a month. This affected not only the disputed AutoCAD sales, but everything else he was selling (vintage comic books, apparently).

All this from spurious DMCA complaints when the guy wasn't copying anything. Here's a boxed, legitimate version of AutoCAD, a copy made by AutoCAD, for sale. In what bizarro world does copyright even apply to that situation?

By the usual analogy, it would be like Ford suing a used car dealer for selling used Ford cars on the grounds that Ford's copyright had been infringed. Huh?

At most it's a contract issue. And a dubious, shrink-wrapped contract at that. The DMCA is irrelevant.

I hate to get overly technical...

[Anita Coney]

But what the court actually determined is that software licensing agreements (as currently written) do not apply to third parties. And that those third parties have the right to resell software under the first sale doctrine.

Even so, it's still an amazing ruling.

Anyone knows how these laws work in Canada?

[urbanriot]

I have a client that was recently nailed by the BSA for having illegitimate copies of Autocad, because they purchased them online through various Ebay auctions (they only needed 2005 LT, not the latest and greatest, expensive version). The BSA deemed their less than 10 copies to be illegal, and nailed them with a hefty fine. My client wanted to avoid a legal battle, so they settled and paid this fine.

That being said, does anyone know what the laws are in Canada regarding reselling retail, boxed Autocad, and if my client had a foot to stand on?

Re:Anyone knows how these laws work in Canada?

[geekoid]

"My client wanted to avoid a legal battle, so they settled and paid this fine. "
And that's why the get away with this crap. People willing to be shit upon for convenience.

Re:Anyone knows how these laws work in Canada?

[rcw-home]

And that's why the get away with this crap. People willing to be shit upon for convenience.

Anyone know if Canada has any laws similar to the US's Racketeer influenced and Corrupt Organizations Act?

Google's Attorney's Blog

[jmichaelg]

This blog entry by William Patry adds quite a bit of background.

Patry is Senior Copyright Counsel for Google.

Also what about Cisco routers and switches?

[Anonymous Coward]

Cisco has always claimed that when you buy a new router or catalyst switch from them that the IOS license is only good for the original purchaser of the hardware. You can legally sell the h/w as used equipment to another party later, but cannot legally transfer the firmware license to the buyer, they are supposed to have to re-purchase the IOS license again from Cisco, else they are illegally running it if the used router or switch came with the IOS software still present in its flash memory.

This ruling will be good for the industry

[MikeRT]

No doubt, part of the problem it has with piracy comes from the way that software isn't held to the same expectations as physical property, adjusted for the ability to copy it. If I buy a copy of Autocad, I should be able to sell my one copy of it. I can do that with anything else in my home. Why should software be exempted from this social and legal convention of property use?

Precedent

[Weaselmancer]

Why generate such bad press over a single copy...

Because they were hoping to set a precedent, that's why.

Same reason the RIAA backs out anytime one of their victims looks like he can put up a decent fight. Precedent is powerful.

The difference here being that Autodesk got their asses handed to them because they decided to see their illogical claim all the way through to a ruling. I'm sure they were hoping for a ruling in their favor so that future claims would be a rubber-stamp process.

Unfortunately for them, they lost. Surprise! Now the rubber stamp is in the hands of the consumers. You takes your chances and you rolls your dice, right?

Pfft.

[cfulmer]

Certainly more than a non-event.

      The denial means that if Vernon's version of the facts are correct, he wins. The only question is whether his version of the facts are correct.

      The case still goes on, but the opinion is good precedent for future cases with similar facts.

Troll??

[thtrgremlin]

I think a very valid argument is being made, and people have been saying this for awhile. People share and lend books to friends all the time. Yes, it is difficult to get a break in the book market, but the real advantage in movies and music (fir the producers) is barriers to market. As Lawerence Lessig argues (in part) in his book Free Culture, movie companies don't care about piracy, what they worry about is a reduction in the barriers to market. P2P enables anyone with a $200 camera and a $1500 computer to be a movie producer and seen by anyone almost instantly with no restrictions to geographic region. This terrifies the big movie companies. It has been easy for them to make lots of bad movies because there are not a lot of alternatives when it previously required millions of dollars and the studios permission to get in on the game.

As for CD's? It is as dead as AM radio (AM Radio has a dirty history, read Free Culture)

Re:Troll??

[ejecta]

Hmm, AM Radio is alive and well here, the AM stations are frequently in the Top 5 most listened to according to Neilsen Ratings.

I'd say AM is very, very far from being 'dead'.

(here = Australia)

Music, not movies

[Weaselmancer]

As Lawerence Lessig argues (in part) in his book Free Culture, movie companies don't care about piracy, what they worry about is a reduction in the barriers to market. P2P enables anyone with a $200 camera and a $1500 computer to be a movie producer and seen by anyone almost instantly with no restrictions to geographic region.

That argument works just fine for music, but IMHO not so great for movies.

Reason being, a good song is just that - a good song. Three or four people with a few thousand dollars worth of gear can make some damn good music. Put them in a million dollar studio and the quality doesn't really go up all that much.

A good movie is a lot more difficult. Far more expensive. While scripting lately has sucked, Hollywood can't really be beat in terms of technical prowess. Unlike music, the more money you throw at a given project the better the results. Watch some of the other CDs that came with your Lord of the Rings set to see just how much went into making that, for example.

To put the argument on the other side of the court - how about porn? The one movie market where the large retailers and the home producers are on close to equal footing. Reason being - no script, no special effects, no huge budget. All you need is a room, a camera, and a few willing people. And homemade porn sure hasn't put a damper on the professionally produced variety.

I think the music people are far more worried about the "barrier to market" argument. And the litigation record would probably back that up. It's the RIAA that's going mad with the lawsuits. Compared to those folks, you hear hardly a peep from the MPAA.

Re:Music, not movies

[Jesus_666]

Actually, nowadays it's becoming more and more easy to produce high-quality movies. You can do a render movie - in that case you only need decent voice actors, more or less powerful hardware, time and one or more persons who are good with the appropriate tools (and as Elephant's Dream has shown, such tools don't even need to cost money).

Good live-action movies can be filmed on a limited budget, as well. Just because 70% of all new movies have huge explosions and/or funky effects there is no requirement for all movies to be that way. A movie like Run Lola Run could be made without many effects requiring expensive equipment (like camera cranes).

Of course those movies will cater to a different audience than big SFX-heavy productions, but I do think that there might be a genuine market.

Not so new

[softwareStalker]

It sounds like this is the first time first-sale doctrine has been applied to software. Nope, in 2001 a similar ruling was made backing up the little guy. Softman v. Adobe. Check it out.

your response is naive

[ClioCJS]

Rental stores HAVE to use rental versions of the movies. Just stick it in your dvd-rom -- sometimes the volume label for the disc will even SAY rental. Usually the front of the disc will. Whereas you and I pay $5-$15 for a movie, I believe a rental version goes more for $60.

Re:Workaround.. PLU...

[davidsyes]

They already have the PLU, which is just ONE way to create an extreme hassle to would-be second-owners, and a deterrent to first-purchaser resales.

Basically, the PLU, or portable license utility, is installed with every protected Autodesk product. Well, at least with AutoCAD. After you register and authorize your licensed copy (electronically or over the phone, etc), the PLU ties that license to that machine. If you install and try to run another instance of the software on another machine, or even reinstall on your own after a total disk wipe, you'll have to re-register or at least get re-authorization.

http://discussion.autodesk.com/thread.jspa?threadID=608297

http://discussion.autodesk.com/thread.jspa?threadID=478591

http://www.autodesk.co.uk/adsk/servlet/item?siteID=452932&id=6005296&preview=1

http://www.cvis.com/MP/Using_the_Portable_License_Utility.htm

http://www.tovna.com/main/softlock.htm

http://www.cadforum.cz/cadforum_en/qaID.asp?tip=2396

When you want to legally for a day or a week or whatever transfer the user activity from one machine to another, you activate the PLU, specify the target machine to which the license is to be sent. When done, do the same on the current machine to get the license back to your original machine. If you botch it, you've got to call Autodesk. Botch it TOO many times, they'll forever deny re-authorization for that particular license.

If confused, contact Autodesk, or go visit the AUGI and other sites.

I don't particularly have a problem with the PLU. But, if the PLU is used to deprive resale by legitimate license holders who want to dispose of the product and maybe use a competing product, then "locking in" the user is heinous. I use AutoCAD for WORK. But, for my hobby, I use TurboCAD and Punch! ViaCAD and marine products meant for ship design. AutoCAD 2009 and even 08 have some nifty features, but about all I don't like about TC & VC is their pseudo-command-line is limited to single strokes, not multiple characters. That makes me think AutoCAD has some "patent" lock or threat against other CAD companies attacking AD on the command line. If that is TRUE, then that'll be yet another reason for me to continue using the smaller guy for my non-work activities.

As a lawyer . . .

[MarkvW]

I wonder whether the guy would have a claim against Autodesk for improperly interfering with his contractual relationship with Ebay . . .

Re:Ummm.. NO...

[vux984]

until the mid 90's the method of studios recuping rental revenue was to have a different pricepoint for VHS videocasettes that were sold as licensed/ allowed to be rented, vs private home use casettes sold at Kmart Etc.

They didn't have a different price-point for rentals, they just released them first with insanely high prices, that they only marketed to rental outlets.

This first release was =intended= to be sold to rental outlets, the model of doing it this way was specifically designed to wring extra money out rental outlets. But to do it they had to hold off on releasing it at lower price. And they were allowed to sell them at retail, if they could find anyone to buy them, but of course, the retail market for $120-200 VHS tapes that would available at 90% off in 3-12months was pretty much nil. But most video stores would order and sell you a copy during that window if you 'just had to have it', although at the time, 'selling videos' was in its infancy.

Once window was up and it was released at the lower 'consumer price' video outlets could buy additional copies at the lower price too... but why would they? The movies were 3 to 12 months old, and were no longer in high demand as rentals... the shelves were filled with new new releases, and they were probably already looking to unload most of the copies they had as previously viewed.

small video stores would literally pay 5-8times the price for a copy destined to be rented repeatedly.

They were 'effectively' trapped paying 5-10x as much for movies if they wanted to be competitive and have the latest new releases.

But, for example if you were opening a new video store, you only had to shell out the big money for 'new releases' (because it was either that or not having any), but you could stock up your 'weekly rentals' with movies you bought used, or at kmart, or from your own collection...

AM Radio

[thtrgremlin]

I knew that would be a bit of an inside joke.

AM radio was a big and powerful medium long before tv, but there were some serious drawbacks (like that annoying perpetual humming in the background). Edwin Armstrong, scientist, was commissioned to improve on AM radio on the promise that big media would license it. Mind you they held all the patents for all the technology and the power to control the future technology in many ways money can.

What was totally unexpected was Edwin went on to develop FM radio, something beating all the problems of AM, and totally outside the scope of big media control. Just as Edison tried to do to Tesla with AC power, Edwin was discredited and sued into oblivion, and during all the distractions of a European war, big media managed to buy protection from congress to ensure FM would have to stay within a narrow band of frequencies and transmission power, despite the fact FM was and is superior in every way. Note:limiting transmission power was necessary to ban it from being usable by the government or telecoms which would have required the kind of power that was only legal for AM, for trans-American and transatlantic broadcast. Edwin, eventually old and ruined, seeing what he knew was great destroyed, went on to blow his brains out.

And today we have a strong and thriving AM radio industry, a towering zombie icon to political corruption and an eternal symbol for the power of money!

So as I said, their dead like AM radio :)

Re:AM Radio

[thtrgremlin]

There is a good wiki article on him, not to mention Free Culture, where I read about this history, is licensed under creative commons; it is free to read online/PDF, though 30 pages in, I bought a copy. :)
http://www.free-culture.cc/

IMHO, Lessig is a really amazing person. Not to spam, but his "Last Lecture" on Free Culture at Stanford University is about Eldred v. United States, among other things which I would bet you would enjoy if you are into this kind of history. Also a CC work :)
http://www.opensourcecinema.org/lessigfinal

You may end up being his boss...

[bwcbwc]

but your company will probably go out of business if you keep human machinists on hand to do painstaking measurements instead of letting robots measure, cut and build the stuff directly from the 3-d models.