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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.
Score one for the little guy!
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.
Those of you who have not had to deal with their software and their heavy handed approach to licensing and upgrades are lucky.
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.
Dvorak on Doomtech
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.
Trusted Computing FAQ | Free Dawit Isaak!
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.
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.
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.
Whale
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.
Sig Battery depleted. Reverting to safe mode.
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.
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.
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.
Weaselmancer
rediculous.
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.
My sci-fi novel, Ghost Thief, is now available from Amazon.com.
That act is specifically prohibited by the Copyright act. (At your discretion of course).
See http://en.wikipedia.org/wiki/First-sale_doctrine
Sig Battery depleted. Reverting to safe mode.
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.
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?
This blog entry by William Patry adds quite a bit of background.
Patry is Senior Copyright Counsel for Google.
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.
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!
"Be light, stinging, insolent and melancholy"
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.
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
The only title of honor that a tyrant can grant is "Enemy of the State."
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.
500 dollar reward for tip(s) leading to the arrest of the person(s) who stole my sig.
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.
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!
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.
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)
Want Big Business out of government? Take away the incentive and start by getting government out of big business!
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.
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.
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.
Weaselmancer
rediculous.
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.
Previously: "Linux... Toward the Sunrise..." Now: "Linux... Toward the-- No, now, part of Every Sunrise"
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
Want Big Business out of government? Take away the incentive and start by getting government out of big business!