Sunday, 30 October 2011

Second-hand software

There's a lot of it around, but is it legal? Can the licence be transferred to a buyer? That was the issue in  Vernor v. Autodesk, in which Mr Vernor offered unopened, authentic, copies of AutoCAD for sale on eBay. When challenged he applied to the District Court for the Western District of Washington for declaratory relief (that link takes you to a piece published by Foley Hoag) and he got summary judgment. On appeal from the District Court, the Court of Appeals for the Ninth Circuit held that Autodesk's customers were licensees and not owners so the sale of the AutoCAD software to Vernor, which was prohibited by the AutoCAD license, was invalid. Mr Vernor was neither a licensee nor an owner and the first sale doctrine was of no assistance to him.

On 3 October the US Supreme Court declined a request to grant certiorari. This means that the Ninth Circuit's three-prong test for determining whether a software user is a licensee or an owner is the law, at least in the Ninth Circuit. This raises the intriguing and very US question whether other circuits will follow the Ninth, and if differences emerge the Supreme Court might well have to take the matter on. Meanwhile, the original claim is back with the District Court, and at the same time an expedition to Luxembourg is under way (from the Bundesgerichthof) in Case C-128/11 Oracle International Corporation v usedSoft GmbH, which might of course produce a completely different answer ... Given that the terms of the licence are crucial in these cases, that might be quite possible and perfectly correct. In any event, it's an interesting area.

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