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Court Rules For Software Ownership Over Licensing

kdawson posted more than 4 years ago | from the broke-it-you-bought-it dept.

The Courts 177

valderost writes "Out-law.com reports on a finding of the US District Court for the Western District of Washington, in favor of an individual reselling Autodesk's AutoCAD software in 'his claim that he owned the software and had the right to sell it on.' The decision hinges on some technicalities in the Autodesk license and conflicting precedents involving a Vanessa Redgrave film, but it's good news for the idea that a software purchase is just that. 'The Court said that it had to follow [the film] case's precedent because it was older than another conflicting ruling, and that it could not choose a precedent based on the most desirable policy. "The court's decision today is not based on any policy judgment. Congress is both constitutionally and institutionally suited to render judgments on policy; courts generally are not," the Court ruled. "Precedent binds the court regardless of whether it would be good policy to ignore it."'"

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177 comments

Information wants to be free (-1)

Anonymous Coward | more than 4 years ago | (#29666699)

You can't own software, man.

Re:Information wants to be free (-1)

tomhudson (43916) | more than 4 years ago | (#29666757)

You can't own software, man.

In Soviet Amerika, Microsoft p0wnes YOU!

Hey, someone had to say it ...

Re:Information wants to be free (0)

Anonymous Coward | more than 4 years ago | (#29666913)

OMG p0wnes!1!!

Hey, someone had to say it ...

Re:Information wants to be free (5, Insightful)

ZosX (517789) | more than 4 years ago | (#29666785)

"You can't own software, man."

Define ownership. You can own the physical (ever disappearing) media that the software comes from. You can own the rights to the software and its code. You can own a license to use the software. This is the problem and one that will be challenged in the future when software moves to pure digital distribution. Do you actually own what is on your hard drive? I say yes, but what happens when you have to reinstall and your only installer is some steam-like gateway that approves and disapproves of your access to said software? This is going to be a MAJOR shift your rights to copy software and make backups. The tide is already turning away from the consumer (some would say its long since been gone), but when you have no way to just reinstall software it might create some serious problems.

Like here is an easy example. You needed to reinstall windows (again!), but you ran out of installs on your oem key. Whoops. Gotta call microsoft and beg them to let you use the software you own. Next you go to install Photoshop with adobe's new digital distribution service (the only way to get CS5), but their server is down and you need to work on a project today. If you had a disk you could just install, but no, you as a paying customer get to be treated like a potential criminal. I know this is kind of extreme, but you see where I'm going and we are really almost at that point.

Sorry for the generalizations. I'm pretty much toast right now. Time for bed. Goodnight slashdotters!

Re:Information wants to be free (1)

Plekto (1018050) | more than 4 years ago | (#29667071)

I say yes, but what happens when you have to reinstall and your only installer is some steam-like gateway that approves and disapproves of your access to said software? This is going to be a MAJOR shift your rights to copy software and make backups.

True, but it makes sense that any physical copy that you have is exactly like any other physical object that you want to sell or give away. I think all this will do, though, is make software publishers move their content to purely online and charge a hefty premium for a hard copy(my data recovery software is like this, actually - and yes, I paid the $20+shippng/tax extra for the CD).

Re:Information wants to be free (5, Insightful)

Kjella (173770) | more than 4 years ago | (#29667077)

Extreme? No. I've been locked out of software I bought, probably because of trying to make it work under WINE with quite a few installs. Took them three days to answer mail (was on a weekend), I had said "fuck it" and downloaded DVD+crack long ago. I probably don't need to tell you what happened to my Stream games when the %#% cable company took a month and a half to fix my Internet. I do want to pay for the good stuff, what little there is of it, but that sort of thing makes me mad. Particularly because me buying something, despite having the full thing downloaded already, only "proves" that DRM works *rolls eyes*. No, it doesn't. DRM is and always will be pathetically useless. It might mean I actually like it and want more games/movies/music/series/whatever like that though. At least the music industry seems to have finally gotten the message even though they were dragged kicking and screaming into the DRM-free world.

Re:Information wants to be free (0)

Anonymous Coward | more than 4 years ago | (#29667803)

Steam have an offline mode, you know.

Re:Information wants to be free (1)

hydroponx (1616401) | more than 4 years ago | (#29669149)

Yes, but is it valid for >30days? From my understanding, if it can't connect to steam for 30days it does some type of de-activation until it can.

Disclaimer: I never bought into steam and have only used it to download a "free" game that came wit a video card years ago

Re:Information wants to be free (5, Informative)

Budenny (888916) | more than 4 years ago | (#29667101)

The various cases on this matter make it clear that there are three different things involved. Read Title 17 Section 117.

You may own copyright in the software. This gives you the right to control what copies are made, with one exception. This, copyright ownership, is what people usually mean when they talk about owning the software. It is the same as a publisher owning copyright to a book. He may print and sell as many copies as he wants.

You may also own a retail copy. This is what Vernor finds, and what Softman found before that. It has been repeatedly argued by software suppliers that you do not own the copy, that you only own a license to use. It has now been found for the second time that you own it, and the criterion used is whether the supplier has any right to repossess. If not, the copy is yours.

We next come to copies made in way of use. If the software is not supplied 'live', ie running off the installation media, it must be installed. Installation constitutes copying. It would be illegal under copyright law without some explicit permission. In fact the sort of copying which also occurs during use when the software is read into memory was found illegal in the well known MAI case, until Title 17 S 1117 was revised as a result of this case.

The revisions provided that copies and modifications made or authorized by the owner which were essential to use with a machine (notice the article, "a" machine) are permitted. But 117 also provides that if you resell the copy you own, you may only sell with it the copies you have made in way of being essential to use, with the consent of the copyright holder.

So, to summarize the situation, when you buy a retail copy of software, you own that copy. You do not become the copyright holder, your right to make copies is limited by Title 17. You may make copies (or modifications) that are essential to use with "a" machine - by implication, the machine of your choice, not of the copyright holder's choice. But your rights over resale of those copies is limited.

Two things are sometimes argued about this.

(1) It is sometimes argued that you may only use a machine which is essential. For instance, you may not install OSX on a Dell, because a Dell is not an essential machine, you could equally well use a Mac. Wrong. The machine does not have to be essential, and the article is indefinite, "a" machine. What has to be essential is the copying.

(2) It is also sometimes argued that because you have no rights of resale of the copies made in way of being essential to use, the copyright holder owns them, and you do not. There is no ground for this view. The test of repossession does not suggest this. The copyright holder has no right of repossession of those copies, and you have a right to them in perpetuity with no further payments. The situation is, you own them but you have restricted rights of resale.

So where does this leave Psystar and OSX? In a very simple situation. If they installed without having transferred the ownership of the retail copy of OSX to the customer, they were in violation of copyright. If they were made when ownership of machine and copy had been transferred, they were permitted by 117 as having been authorized by the owner, and were not then resold, so no permission for transfer was required, as they were never transferred.

This means that there need not have been any violation of copyright, but there was of course a breach of the Apple EULA. Whether the term of that EULA which obliges you to buy your hardware from Apple is enforceable is a quite different matter. But as far as copyright goes, you are the owner of any retail copy of OSX, or MS Office, that you have lawfully acquired. There is nothing in copyright law to stop you installing it wherever you want, as long as you do not make more than one copy. It says "a" machine, remember.

Re:Information wants to be free (1)

hellop2 (1271166) | more than 4 years ago | (#29668323)

You said you may only make 'a' copy. And you said that installing from media constitutes a copy. To clarify, the law says that you can also make an archival (backup) copy. You know, in case your CD gets scratched. From copyright.gov:

Under section 117, you or someone you authorize may make a copy of an original computer program if:

* the new copy is being made for archival (i.e., backup) purposes only;
* you are the legal owner of the copy; and
* any copy made for archival purposes is either destroyed, or transferred with the original copy, once the original copy is sold, given away, or otherwise transferred.

Don't read too much into 'a' (1)

tepples (727027) | more than 4 years ago | (#29668363)

You said you may only make 'a' copy.

Don't read too much into the word 'a'. It appears Congress wanted to limit the number of copies to however many are reasonably necessary for "an essential step in the utilization" or "for archival purposes". If it wanted to limit the number more specifically, it would have used the long form of the article: "one copy", and 117(b) would have begun with "The exact copy", not "Any exact copies".

Owning software vs. owning a book (0)

tepples (727027) | more than 4 years ago | (#29668391)

This, copyright ownership, is what people usually mean when they talk about owning the software.

But do people usually mean copyright ownership when they talk about owning a book? I don't think so. If not, where did the difference come from.

Re:Information wants to be free (1)

Scamwise (174654) | more than 4 years ago | (#29667367)

That scenario is nothing, try installing the lastest version of Grand Theft Auto without an internet connection...

Re:Information wants to be free (3, Insightful)

Fross (83754) | more than 4 years ago | (#29667631)

The version on TPB works just fine.

Re:Information wants to be free (0)

Anonymous Coward | more than 4 years ago | (#29667857)

Ahem, gp said "without an internet connection..."

Re:Information wants to be free (5, Insightful)

hairyfeet (841228) | more than 4 years ago | (#29667901)

And you just hit the nail right on the head with that simple statement, bravo. All this bullshit does is make the pirated version in EVERY WAY better than the "legitimate" version. Take my case for example, I have to fricking crack every. damned. single. game. I own. Why? Because XP X64 (my OS of choice) plays all the games, even the older ones beautifully while giving me access to my 8Gb of RAM but the ^&%$&^&$^&%$ DRM don't work, that's why!!! You get that stupid "insert disc in drive E:" bullshit. It IS in drive E:, you stupid piece of crap!

And God help you if you don't notice the sometimes invisible warning and get "starforced" as guess what? Their damned uninstaller don't work on x64 buddy! That's right, enjoy a day spent dual boot and hacking the reg to get rid of that festering turd, but as you pointed out TPB version works just fine on XP X64. But I think this guy [metacafe.com] (warning-language which you can't blame him for if you watch the video) says it better than I ever could.

Just give me one more Starfoce infection game makers, just one more, and yes it IS an infection, as a PC repairman I can tell you that a Starforce+Safedisc+SecuROM infection is nastier than most malware out today, and you can kiss my money goodbye. If my choices are paying for the "privilege" of getting kicked in the nuts or NOT paying and not getting kicked in the crotch or spending more time "enjoying the fun" of removing your broken DRM than playing your latest crappy $59 "extravaganza"? Well it'll be TPB for the win, and you'll have NO ONE to blame but yourself. Because I don't know about everyone else, but I'm mad as hell and I'm not going to take this anymore!

Re:Information wants to be free (1)

jonbryce (703250) | more than 4 years ago | (#29668271)

You own your copy of the software, and the first sale doctrine allows you to sell that to someone else.

Re:Information wants to be free (2, Interesting)

windex82 (696915) | more than 4 years ago | (#29668977)

Whoops. Gotta call microsoft and beg them to let you use the software you own.

I don't believe you've ever called Microsoft to get software activated. Unless by begging you mean answering "no" or "one" to the "is this installed on any other computers" or "how many computers is this installed on" questions. In that case your and my definition of the word are completely different.

I agree with you in that you shouldn't have to in either case but the phone activation is far from difficult and have never been denied an activation key despite actually calling them in various capacities activating hundreds of softwares over the phone for anything from XP to TS.

Re:Information wants to be free (2, Funny)

Anonymous Coward | more than 4 years ago | (#29667019)

Unless its Leenux - then you better follow that gnu/license you software pirate!

Re:Information wants to be free (3, Insightful)

JohnBailey (1092697) | more than 4 years ago | (#29667361)

You can't own software, man.

Then you can't sell it or steal it either.

Re:Information wants to be free (1)

K. S. Kyosuke (729550) | more than 4 years ago | (#29668873)

You can't own software, man.

Try telling that all those software companies... :-)

Err... (4, Insightful)

QuoteMstr (55051) | more than 4 years ago | (#29666727)

So the court, by mentioning the dictates of precedent in the first place, is implying that it thinks licensing is the preferred policy? How on earth is that pro-precedent and policy-neutral?

Re:Err... (1)

QuantumG (50515) | more than 4 years ago | (#29666775)

the finding does kinda sound like "we can't fix this loophole in this court, but try a higher court!"

Re:Err... (5, Insightful)

eam (192101) | more than 4 years ago | (#29668183)

...more like "we can't fix this loophole in court, lobby congress instead!"

Re:Err... (4, Interesting)

JoshuaZ (1134087) | more than 4 years ago | (#29666787)

No, the court is saying that it isn't expressing any opinion about what the law should be and is making that point very clear, probably so that no one will mistakenly point to this as a precedent of a court deciding that the law should be this way for software.

Re:Err... (1)

RichiH (749257) | more than 4 years ago | (#29667141)

Dunno, while re-reading and re-reading the quotes I can not decide if they want to be as neutral as possible or if they would have preferred licensing. While I am not sure, I think they meant the latter.

Re:Err... (1)

commodore64_love (1445365) | more than 4 years ago | (#29668563)

It seems everyone is trying to strip-away our property rights.

If you buy a physical object, it's yours to do with it what you wish, including selling the object to the next person, via garage sale or ebay. I can understand why organizations like RIAA want to strip-away our property so they can make themselves richer, but not the judges. Judges should be on the side of the People and protecting our rights.

Re:Err... (1)

plague3106 (71849) | more than 4 years ago | (#29669021)

Ugh... what nonsense. Nobody is trying to strip away your property rights. But the fact remains its whats ON the disc that you care to purchase, NOT the disc itself.

You can't hold software in your hand; you can only hold the media on which its stored.

If you want a blank disc, they are available, and no one is debating your right to own blank discs.

Re:Err... (1)

jedidiah (1196) | more than 4 years ago | (#29669295)

It's not nonsense at all. "Property rights" are what makes this whole thing work. We can own
things and our toils will help enable that. If we work harder, we might be able to own more
or better things. Eventually those things might be valuable enough that we don't have to work
at all and our things do all the work for us.

This is one way you get ahead in capitalism.

The promise of this is what keeps the drone, peons and proles with their shoulder to the grindstone.

This same principle is what motivates the Dells, Gates' and Ellison's of this world.

If you undermine property rights of INDIVIDUALS, you are taking a jack hammer to the foundations of the economy.

Re:Err... (2, Insightful)

cduffy (652) | more than 4 years ago | (#29669401)

Why would you not let folks own outright disks containing copyrighted software as well?

Just because I own a disk doesn't mean I own the copyright to the software on the disk, and that copyright prevents me from making copies (or public performances, or several other things explicitly listed by copyright law) without paying the copyright owner for permission to do so. While it does permit restrictions on making of copies, public performance, preparation of derivative works and the like, however, copyright law does not allow the copyright owner to determine whether I can resell an embodiment of their work -- this is why Autodesk has resorted to licensing to do so.

The question, though, is this: Why is there a compelling public-interest need to allow copyright owners to extend their control over embodiments of their works beyond that which copyright law already provides?

Answer that question, and we'll have a better understanding of each others' positions.

They are DEFINITELY wanting a different outcome (0)

Anonymous Coward | more than 4 years ago | (#29667795)

"Precedent binds the court regardless of whether it would be good policy to ignore it."

Why would they say that if they didn't want a different outcome? If that were the case, "Precedent binds the court" would be enough.

"The Court said that it had to follow [the film] case's precedent because it was older than another conflicting ruling, and that it could not choose a precedent based on the most desirable policy"

it couldn't choose a precedent based on the most desirable policy, therefore the precedent they followed was not the one that leads to the most desirable policy.

It's pretty cut-and-dried, kid.

Re:Err... (4, Informative)

Anonymous Coward | more than 4 years ago | (#29666869)

So the court, by mentioning the dictates of precedent in the first place, is implying that it thinks licensing is the preferred policy?

The Court was almost certainly responding to arguments put by both parties that were policy based. It was politely pointing out the reason why it just ignored all those arguments from both sides and focused purely on what the precedents say. Because that's the Court's job. In particular to the losing party it amounts to "and if you don't like it, go and bother your mom^WCongress instead".

Would have to read the full decision and/or the filingd by the parties to be sure though.

Re:Err... (4, Insightful)

Anonymous Coward | more than 4 years ago | (#29667039)

I interpret that as the judge answering an argument by the losers.

Most likely Autodesk argued that full ownership of software would hurt it's business. The article says as much, if you read between the lines. Of course, they neglected to mention that a mere license model hurts consumers, but since the court rejected the argument anyway, it's all good.

Re:Err... (1)

mrmeval (662166) | more than 4 years ago | (#29667519)

They court is chomping at the precedent bit in it's slobbering mouth to rule AGAINST the owner.

I say we put the horse down.

State matter? (1)

mysidia (191772) | more than 4 years ago | (#29666731)

Why congress?

Is it not up to the states to decide what rights are transferred when something is being sold at the store?

Contracts and the purchase/sale of goods are generally distinctly state issues...

Re:State matter? (1)

Kierthos (225954) | more than 4 years ago | (#29666837)

Why Congress? Probably due to interstate commerce laws.

Re:State matter? (5, Interesting)

meerling (1487879) | more than 4 years ago | (#29667043)

when you start getting down to the actual rights that are transferred with a purchase of goods, if you leave it to the states, you will cause massive damage to interstate commerce. Those boobs can't even come up with consistent sentencing for crimes, there's no way they'll voluntarily adopt a single consistent set of rules over this unless it's done at the federal level.

If any readers still can't imagine what the problem is with that, think about it for a bit. Here's a few hints, imagine if a company in Maine sold software to people in all the states. In Texas they might be forced to provide updates for free for a period of 3 years, while in Ohio updates have a cost $1.00 but they only have to be available for 6 months. Now in Colorado you can resell your software, but in Florida you don't own it - it's all leased for a period of no more than 4 years. Getting messy already, and we've only covered 4 states. (Maine didn't count because I never said anything about their local laws on ownership/sales.)

By the way, if you are buying land in a state other than your own, check what the state laws are where you are buying it. Some states you get the works. Others, you don't get mineral rights. Some, you get water rights, and you might get mineral rights, but not oil rights, that's a seperate thing altogether. (Can you guess which states I'm talking about?)

In California you can buy beachfront property, and you get the beach. In Oregon (same coast, just farther north) you can still buy beachfront property, but the beach always has, and always will, belong to 'the people'. (Lots of Californian developers have gotten massively pissed over that when they tried to put up walls or fences...) The coast belonging to the people of Oregon is essential native traditions that were adopted into laws for Oregon. This is just a small example the differences that already occur, and you don't ship real estate across state lines, imagine how screwed up that would be.

Re:State matter? (1)

tkrotchko (124118) | more than 4 years ago | (#29667757)

"you will cause massive damage to interstate commerce"

Autodesk seemed to be doing a good job of that all on their own.

Re:State matter? (0)

Anonymous Coward | more than 4 years ago | (#29667925)

This is why there is the Uniform Commercial Code governing personal property transfers. Unfortunately the process of bringing it up to date on issues like software licensing have been rather un uniform, prompting the proposed amendment to be broken off as the Uniform Computer Information Transactions Act. It is only adopted by two states, and seems fairly devoid of consumer protections. It seems like the Court's complete refusal to debate policy is a nice way of achieving a public policy-like opinion (consumer protection wins the day, and this particular software license confers a property right in the individual copy) without purporting to do so.

Re:State matter? (2, Informative)

Anonymous Coward | more than 4 years ago | (#29667881)

Copyright is granted under the IP clause of the Constitution, and its regulation given to Congress.
This is the policy interest to which the court referred, i.e. Congress may step in and legislate that although copyright creates a divisible property interest which may be sold in part or whole, to other parties, the sale of a copy of software is, as a matter of law a (license or transfer of property right over that copy)
All the court is saying is that the jurisprudence says that AutoDesk's own license says that the sale of a copy is a property transfer, on that particular copy, but that if Congress wants a different policy, it is free to change the Copyright Act.

Re:State matter? (1)

cpt kangarooski (3773) | more than 4 years ago | (#29668189)

Yes, I also thought that was an odd thing to say. While this case is about copyright, and therefore federal courts have exclusive jurisdiction, the contract law and sales law that it should be looking at will all be from the relevant state(s). Certainly, the leading cases on this issue have all been based heavily on the UCC, which is state law.

I suppose Congress could make some policy here, but they haven't yet, which leaves it to the states.

So when they say "Own this movie on DVD today!" (1)

tomhudson (43916) | more than 4 years ago | (#29666733)

I really own it? Great!

Re:So when they say "Own this movie on DVD today!" (1)

Thanshin (1188877) | more than 4 years ago | (#29667059)

No, they still mean you can achieve victory by a large margin over the movie, on DVD.

What's still unclear is the game you and the movie are expected to play, but I think it's one that involves paying large amounts of money.

Re:So when they say "Own this movie on DVD today!" (1)

Jedi Alec (258881) | more than 4 years ago | (#29667955)

What's still unclear is the game you and the movie are expected to play, but I think it's one that involves paying large amounts of money.

And the only way to win is not to play. Which reminds me, where's my DVD with the uncut director's version de luxe gold edition of Wargames anyway?

Sweet! (2, Interesting)

SheeEttin (899897) | more than 4 years ago | (#29666739)

Sweet! Now maybe we can affirm that we actually own things we purchase, and companies like Nintendo will stop stuffing up things like homebrew.

Re:Sweet! (5, Insightful)

Okind (556066) | more than 4 years ago | (#29666817)

Exactly: the ruling said that selling software second-hand is entirely legal. Of course, the software is still covered by copyright and it's license, so you're really selling the license.

By effectively upholding the first sale doctrine, this judge did the right thing.

Re:Sweet! (0)

Anonymous Coward | more than 4 years ago | (#29667007)

What's a license and why do I need one? Isn't "I agree" simply an artistically decorated button to start the program?

Re:Sweet! (2, Informative)

Okind (556066) | more than 4 years ago | (#29667297)

What's a license and why do I need one? Isn't "I agree" simply an artistically decorated button to start the program?

This is not the case: simply saying "yes" is an agreement, with full legal consequences, provided it can be proven in court. With software, proving that you clicked "I agree" is much simpler. After all: without altering the program (which is not allowed without a license), the program won't install before you explicitly agree to the license.

Simply put, a license is an agreement giving you the right to use the software. Note that this actually to any copyrighted material, so it also covers the images, music, movies, etc. in a game. Without a license, you can only use software if you buy it: at least in the Netherlands there is a limited set of things you may do with software you bought without a license. But there is an important exception here as well: general terms of business.

EULA's are generally valid, even though you explicitly agree to them after you buy/download the software. The reason: they are the same for every user, and are thus general terms of business. There are of course a few restrictions: general terms of business must be legibly available before the sale/download. So a shrink-wrap license (which is not available before the sale/download) is not legally binding.

Many jurisdictions prohibit changing the conditions of sale after the sale. This also includes changes to a license, or the general terms of business, unless they state explicitly that they may change (which us extremely common). And even then there are restrictions in consumer law. For example, in the Netherlands, the changes must be made known to the user beforehand (a change on the website is not enough), well in advance (at least a month) and you have the option to decline. In that case, the contract/license is nullified (so you cannot use the software anymore) at no cost whatsoever.

So in short, a EULA is generally always valid. Your jurisdiction may enforce certain constraints though. For example, in the Netherlands I may always make a backup copy, regardless what the license says. Nor is any license term valid if it limits my right to free speech, for example by publishing benchmarks.

If you don't want to be bound to the license, your only recourse is not to use the software.

NOTE: I live in the Netherlands (Europe), and I have no legal training. Depending on my understanding and where you are, I may completely misrepresent your situation.

Re:Sweet! (1)

razvan784 (1389375) | more than 4 years ago | (#29667789)

I don't know, if I buy a book I can't legally make photocopies of it and distribute them, or make derivative works or whatever; I guess its content is "licensed not sold" to me; its paper would be just like the CD that carries the licensed software. Despite this, I've yet to see any book that includes a license agreement. Why should software be different.

It's a post-sale condition (0)

Anonymous Coward | more than 4 years ago | (#29667827)

Therefore you recieve no consideration for this contracted restriction. therefore there IS no contracted restriction.

You don't even need a license to install and use a program. In the US this is EXPLICIT. Actual use of the program is not covered by copyright. In the UK, personal use was not legal but there was no damages and such breech was a strict tort problem and therefore you could only ask for damages: nil.

So there's no need to have a license, and clicking "I agree" doesn't agree to anything for software.

Additionally, especially in the UK, but it is generally true, a contract or restriction has a cooling-off period. One or two weeks in many US states, 28 days statutory minimum in the UK. You can agree, then disagree and get a full refund and stop using the product.

If the EULA "I Agree" button was a genuine legal contract, you would get this cooling off period too.

Re:Sweet! (1)

Jedi Alec (258881) | more than 4 years ago | (#29668013)

EULA's are generally valid, even though you explicitly agree to them after you buy/download the software. The reason: they are the same for every user, and are thus general terms of business. There are of course a few restrictions: general terms of business must be legibly available before the sale/download. So a shrink-wrap license (which is not available before the sale/download) is not legally binding.

Not only must they be legibly available, either the product itself or the party selling it to you must actively inform you that there is a general terms of business applicable to the product. So when you go to the shop and pick up a copy of Vista, the click-through EULA you need to accept to install isn't worth anything unless either the box or the sales clerk made its contents available to you before or at the moment of purchase.

Unfortunately this doesn't allow you to just keep using the product while not adhering to the EULA. In a situation like this you simply have the right to cancel the sale and demand a full refund, so we all still get to collectively swallow EA's latest legal shite if we want to play Spore.

Dutch wiki article [wikipedia.org] that links to some of the relevant laws.

Re:Sweet! (1)

gnasher719 (869701) | more than 4 years ago | (#29668675)

Not only must they be legibly available, either the product itself or the party selling it to you must actively inform you that there is a general terms of business applicable to the product. So when you go to the shop and pick up a copy of Vista, the click-through EULA you need to accept to install isn't worth anything unless either the box or the sales clerk made its contents available to you before or at the moment of purchase.

Courts have said otherwise. To be more precise, the contract between you and the manufacturer isn't completed when you hand over your money if the manufacturer said there were other conditions. In case of a click-through license, the manufacturer may have to tell you that acceptance of the license is necessary to close the deal, and then the deal is closed when you click the "I agree" button. For this to be legal, the terms must be available and clearly visible to you at the time you click "I agree", and the manufacturer must give you the right to get your money back if you don't agree.

A contract, including a sales contract, is entered when both sides agree to it. If the seller didn't make clear to you that he requests that you agree to the license, then both of you haven't entered a sales contract. So nothing in the license agreement is binding to you, on the other hand you don't have the right to use the software, on the third hand you have the right to get your money back in exchange for returning the software.

Re:Sweet! (2, Insightful)

AK Marc (707885) | more than 4 years ago | (#29668381)

This is not the case: simply saying "yes" is an agreement, with full legal consequences, provided it can be proven in court. With software, proving that you clicked "I agree" is much simpler. After all: without altering the program (which is not allowed without a license), the program won't install before you explicitly agree to the license.

It's a demand that you either click "I agree" on or you lose value of what you purchased. You are being coerced. The "value" is being held hostage after it has already been paid for.

So in short, a EULA is generally always valid.

But "valid" in what sense? Is it a contract? It seems to meet none of the legal requirements of a contract. I get no consideration. I've already paid for it, I already own it, and I get nothing from the EULA (I gain from clicking the "I agree" button, but the EULA itself grants me nothing). It isn't even executed properly. Who is the agreement with? "Autodesk" can't make an agreement. No real contract is signed with the company name. They are always signed by a human, with explanation of how they represent the corporation. The inability to negotiate a contract (as opposed to the unwillingness, which is always allowed) is another disqualifying factor. So I can't see how a EULA can be a contract when it doesn't follow contract law.

If you don't want to be bound to the license, your only recourse is not to use the software.

So you bought it, you own it, and you can't use it. That's not what I paid for. I bought something that said "use this for CAD" and I want to use if for CAD under reasonable terms. If I find their terms unreasonable after I've bought it, then how do I negotiate with them for terms we both can agree on? If no agreement can be reached (because a EULA has no mechanism for negotiation, and negotiation is one of the requirements of contracts), then it isn't a valid contract. Clicking "install now" isn't a legal decision, but a requirement to make the software work. Clicking "I agree" has nothing to do with whether I (or a reasonable person) actually agrees to everything in there, but is a button that must be pushed to use software already bought and paid for, no different and no more legally binding than "install now."

Re:Sweet! (1)

gnasher719 (869701) | more than 4 years ago | (#29668743)

It's a demand that you either click "I agree" on or you lose value of what you purchased. You are being coerced. The "value" is being held hostage after it has already been paid for.

According to the UCITA, you can't legally agree to any license terms unless you can see the license, and the seller offers you your money back. If the seller doesn't offer you the money back, the situation is a bit complicated. The seller holds your money hostage, you hold the software hostage. Losing your money is wrong. Using the software without agreeing to the license is wrong. According to the UCITA, a court (and you, if you decide to use the software), would have to decide which is the bigger wrong, so you would be Ok in using the software without agreeing to the license as long as the damage to the seller isn't much bigger than your damage in losing the money.

Let's say hypothetically some software is sold with a "home use" license for $20 and a "commercial use" license for $2000. If a company buys a "home use" license for $20, finds they can't agree to the "home use" license, and is refused a refund of their $20, they wouldn't have the right to use it. If you buy the same software with the intent to use it at home, find some term in the license that you don't like, and are refused a refund, it is likely Ok for you to use the software at home.

Re:Sweet! (2, Insightful)

plague3106 (71849) | more than 4 years ago | (#29669219)

It's a demand that you either click "I agree" on or you lose value of what you purchased. You are being coerced. The "value" is being held hostage after it has already been paid for.

No, because you can return it for a full refund.

But "valid" in what sense? Is it a contract? It seems to meet none of the legal requirements of a contract. I get no consideration. I've already paid for it, I already own it, and I get nothing from the EULA (I gain from clicking the "I agree" button, but the EULA itself grants me nothing).

No, you get to use the software at the price you paid. That's your consideration. What the OP said is that you were informed there are terms which you can see when you install the program and to complete the sale you must agree to those terms. So the sale doesn't end when you walk out of the store. It ends when you read the EULA and accept or reject it. If you reject it, you back out of the sale and can get your money back. If you accept it, well you've accepted it.

It isn't even executed properly. Who is the agreement with? "Autodesk" can't make an agreement.

Um, it would be with Autodesk. Companies can't make an agreement? Since when?

No real contract is signed with the company name. They are always signed by a human, with explanation of how they represent the corporation.

What? Ever applied for a credit card? The application doesn't even HAVE a place for a company rep to sign. And do you know how you accept the contract once they accept it on their end? You USE the card, or activate it via an automated system. Oh, and its all legal too.

Where do you get this nonsense that a contract must be in a certain form and executed a certain way?

The inability to negotiate a contract (as opposed to the unwillingness, which is always allowed) is another disqualifying factor. So I can't see how a EULA can be a contract when it doesn't follow contract law.

Again, where do you get this nonsense? Theres no law saying a contract has to be negotiable to be valid. Have you ever signed up for ANYTHING? You can't negotate your cell phone agreement, nor can you your electric agreement. If I hand you a contract, tell you these are the terms, take it or leave it, you can do just that... take it or leave it. But you can't take it and then say "oh the contract isn't valid because he didn't let me negotiate."

At the very best you can get out of a contract... but then both parties take what they were offering back.

Re:Sweet! (1)

Rekolitus (899752) | more than 4 years ago | (#29668471)

After all: without altering the program (which is not allowed without a license)

Says who? If I own a copyrighted work, I'm entitled to do what I like with it, save for copying it. That includes modifying it. There is no difference here from me buying a book and scribbling all over it.

Depending on the software, you can also just extract the files without running the installer. Additionally, proving that you "agreed" to the licence needn't be nearly as simple; the user that uses the software isn't necessarily the person that installed it. I also have difficulty believing that EULAs are valid instruments; in disproving the false statements that only the EULA grants you permission to use the software, the EULA becomes extremely one-sided. EULAs that attempt to redefine the nature of a transaction that has already occured, from a sale to a grant of a licence, are particularly entertaining.

Simply put, a license is an agreement giving you the right to use the software.

This is simply false. If I make a piece of software, and distribute it for free online, I don't have to grant the users permission for their use of the software to be lawful. Copyright grants monopoly rights solely over the creation of copies; however, copies of computer programmes created that are technically necessary to the use of software in conjunction with a machine are permitted by law under USC 17-117.

A successful demonstration of this is the GPL:

You are not required to accept this License in order to receive or run a copy of the Program.

Re:Sweet! (0)

Anonymous Coward | more than 4 years ago | (#29668557)

After all: without altering the program (which is not allowed without a license), the program won't install before you explicitly agree to the license

If I buy a physical product in the store, I can start disseminating and altering the product immediately, since the sale and transfer is complete. I am not required to run Setup.exe, and I may not even intend to run it. I can unpack and install the data files manually, without ever encountering a EULA (which may not be uncommon, when you consider the original Doom and Quake games where the installer relies on an OS that is not in use any more and there's numerous 3rd party engines that just need the wad/pk* files). It's yet another problem with them in software, the assumption that you must have clicked through a EULA; there is no proof that a given person did, there were no third-party witnesses, no personal signature, nothing.. just the assumption that I used the product a specific way.

And if I wasn't already entitled to use the software, how could I run it to get to the EULA in the first place? Unless someone can show me the law where it says differently, I can't believe that physically purchasing a copy only entitles you to run its installer setup program and nothing else, until you agree to the EULA.

Re:Sweet! (1)

Rekolitus (899752) | more than 4 years ago | (#29668395)

Of course, the software is still covered by copyright and it's license, so you're really selling the license.

False. A second hand sale involves the sale of physical property. There is no exception for software. A "license" can refer to many things; in the context of software it tends to refer to a fictional concept created by the software industry, the implication being that one is required, typically per user, or even per feature. However, a second-hand copy of a piece of software is a lawfully produced copy of a copyrighted work, and so no license is required merely to transfer ownership, nor is a "license" legally required to use a piece of software.

USC 17-117 creates an exemption for copyright with regards to copies of computer programmes technically necessary to their use in conjunction with a machine. Thus, copies of a computer programme made on a hard drive or in RAM are not infringing.

The lack of necessity of a "license" is demonstrated in the GPL. The GPL explicitly states "You are not required to accept this License in order to receive or run a copy of the Program.".

Re:Sweet! (4, Insightful)

binarylarry (1338699) | more than 4 years ago | (#29666841)

Has Nintendo legally gone after anyone for homebrew?

Simply not supporting the use or installation of it nor fixing damage resulting from it isn't the same thing as taking people to court.

Re:Sweet! (0)

Anonymous Coward | more than 4 years ago | (#29667065)

Gazing into the horse's mouth, Nintendo sets out their legal perspective quite thoroughly without mentioning homebrew specifically. http://www.nintendo.com/corp/legal.jsp [nintendo.com]

But they're definitely all for DCMA type laws, and while they acknowledge the archival exception to illegal copying, they also claim copying devices are only for illegal purposes.

Re:Sweet! (2, Interesting)

Anonymous Coward | more than 4 years ago | (#29667089)

I actually develop games for Nintendo systems professionally. I got my start in the industry through homebrew. It's always been my belief that Nintendo actually LIKES homebrew on their consoles. It serves to train people on how to use their hardware. The problem is that it also usually means copyright infringement. They would take a lot of heat from the 3rd parties and their shareholders if they didn't at least put on a good show of fighting it.

Very important stuff (1)

Qubit (100461) | more than 4 years ago | (#29667121)

Has Nintendo legally gone after anyone for homebrew?

Naw, last I heard they keep their lawyers super busy [penny-arcade.com] going after people who mention their favorite Nintendo games in their online profiles [penny-arcade.com] .

Re:Very important stuff (0)

Anonymous Coward | more than 4 years ago | (#29669287)

Given that the comics are from 2004, you must have gone deaf almost five years ago.

Re:Sweet! (0)

Anonymous Coward | more than 4 years ago | (#29666943)

No just the autodesk license did not specifically deny the owners right to resell.

Be thankfull for Vanessa Redgrave (0)

Anonymous Coward | more than 4 years ago | (#29666743)

He should send a thank you note to Vanessa Redgrave :-)

Can o' worms (1)

pieisgood (841871) | more than 4 years ago | (#29666771)

Oh no they didn't.

Re:Can o' worms (4, Funny)

kitsunewarlock (971818) | more than 4 years ago | (#29667033)

Cans of Worms have lids for a reason.

Mostly because opening the can is a violation of the EULA, voids your warranty and forces you to rely on downloading 3rd party patches for your can as you can no longer connect to WormNet, the premiere Can o' Worms networking solution software that is required to run alongside your Can o' Worms at all times.

Re:Can o' worms (2, Funny)

Thanshin (1188877) | more than 4 years ago | (#29667073)

Cans of Worms have lids for a reason. Mostly because opening the can is a violation of the EULA, voids your warranty and forces you to rely on downloading 3rd party patches

You probably broke the can of worms while trying to install unauthorized worms.

I for one ... (1)

milosoftware (654147) | more than 4 years ago | (#29666801)

... welcome the overlords who licenced us and now pwn.

The last hurdle for download distribution? (4, Insightful)

pegasustonans (589396) | more than 4 years ago | (#29666865)

Not that this will ever happen, but, if the ramifications of this decision are taken to the next level, it could enforce the consumers' right to resell the license to a given software application.

This, in turn, could mean that one could exchange and resell licenses of downloaded games and other media. Of course, the industry will likely pay off any relevant political actors in the interests of piracy prevention long before this occurs.

Then again, software companies are much more open to this type of idea than they were ten years ago. Well, we can always hope.

Re:The last hurdle for download distribution? (1)

QuantumG (50515) | more than 4 years ago | (#29666873)

huh? what? You can resell a download perfectly legally.. the problem is more typically finding a buyer. Of course, if there's any DRM on that download, it's illegal to break it.

Re:The last hurdle for download distribution? (4, Informative)

pegasustonans (589396) | more than 4 years ago | (#29666889)

huh? what? You can resell a download perfectly legally.. the problem is more typically finding a buyer. Of course, if there's any DRM on that download, it's illegal to break it.

I was referring to reselling the license, not the download itself. Actually, I was referring to giving the license away for monetary compensation or no compensation, depending on personal preference (just like a physical disc).

Mod parent up (1)

Scareduck (177470) | more than 4 years ago | (#29667107)

Do not have mod points, but this comment deserves up mods.

test (-1, Redundant)

Anonymous Coward | more than 4 years ago | (#29667139)

sdfsdfasdf

Re:The last hurdle for download distribution? (4, Insightful)

Vaphell (1489021) | more than 4 years ago | (#29667335)

true that i wish it was mandatory by the law to allow reselling with full rights transfer and creating obstacles would get smacked hard. There is need for real protection of user rights, companies have it way too easy to fuck with them. Right now they have a dozen of dirty tricks in their playbook to circumvent 1st sale doctrine and kill 2nd hand market - DRMs, steam like authorizations, binding products to user's account permanently and all that shit are there for exactly that purpose. One can dream...

Re:The last hurdle for download distribution? (1)

Jared555 (874152) | more than 4 years ago | (#29668227)

What is fun is it is getting to where it is difficult if not impossible to resell the license when you even buy a physical copy, unless you sell every game on your account. You are basically buying a one time use key to add to your account and (sometimes) make the install process quicker.

Can a lawyer explain this to me? (3, Interesting)

Anonymous Coward | more than 4 years ago | (#29667067)

My understanding is that in this particular case Autodesk was essentially marketing the software exactly like a product instead of something that is licensed, thereby they couldn't claim that the product was in effect being licensed. Does this have any effect on shrink-wrap licenses and/or regular software?

In Europe, this is the law (4, Interesting)

valentyn (248783) | more than 4 years ago | (#29667119)

This is already European Law (which must be implemented in local laws in al member states). Once sold whithin the EU, you're free to resell your license.

The problem is in the details: if you buy software (i.e. a license to use it), you normally also get a bunch of other rights, like access to updates, maybe even the right to call someone. The law doesn't say that these rights are also transferrable (or transferred). So in most licenses, there's still plenty of "you cannot do this and that (resell, for example), or you will loose the right to such and so".

But the resale of the license to plainly use the software cannot be forbidden by contract in the EU.

Re:In Europe, this is the law (1)

Jared555 (874152) | more than 4 years ago | (#29668235)

What about a system like steam where even when you buy a physical copy it is linked (at least at one time) permanently to your account. Same with most MMORPGs I have seen that actually require purchase of the game, etc.

gedw99 (0, Troll)

gedw99 (1597337) | more than 4 years ago | (#29667205)

Autodesk are Â/Â&Â&'s. Really. I had an AutoCAD licesne that i sold eventually with the hardware dongle years ago. They really stink. 4,000 for a single license is crazy

Re:gedw99 (1)

Jaysyn (203771) | more than 4 years ago | (#29668021)

MicroStation is even more expensive. BTW, which version of AutoCAD were you using that had a hardware dongle? I've been drafting for over 13 years now & haven't run across one.

Re:gedw99 (0)

Anonymous Coward | more than 4 years ago | (#29668541)

3d viz has the dongle in order to use the program the dongle needs to be connected.

Re:gedw99 (0)

Anonymous Coward | more than 4 years ago | (#29668737)

I remember my university having a pain in the but time with trying to mount the serial dongle inside the case. I believe that was AutoCAD 13, but it might have been 12. 13 was buggy and a lot of companies skipped it. I used 14 at work and don't remember ever having a serial dongle, so I believe it was before this. Autodesk also used this same serial dongle on copies of 3D studio that came out about that same time (late 90's).

Re:gedw99 (1)

Jaysyn (203771) | more than 4 years ago | (#29669233)

Ah ok. It must have been r13 cause we went from r12 to r14 & neither of those had dongles.

Finally! I can now own Linux. (-1, Troll)

Anonymous Coward | more than 4 years ago | (#29667259)

Sweet! Now, instead of merely licensing Linux (and having to abide by the terms of the GPL) - I can actually own it. That pesky lawyer-talk always did sound like communism, I'm glad that software creators can no longer decide what rights users have over their stuff.

Anyway, thanks for trying to crush commercial software and killing OSS instead, you heartless bastards! /Because that's what this will lead to if all software licenses are broken.

Re:Finally! I can now own Linux. (1)

gzipped_tar (1151931) | more than 4 years ago | (#29667373)

GPL is about what you should observe when you make copies/derived works and distribute them. No copies or derived works are made in this case.

Re:Finally! I can now own Linux. (2, Insightful)

eldorel (828471) | more than 4 years ago | (#29667401)

There is a difference between a distribution license and a software license.

Gpl, Lgpl, and the like are the former. The right of first sale applies to the latter.

You can already resell linux distros with no issue anyway, and you do own the software when you get it (either via download or by purchasing a disk).

There's no Eula on linux....

Re:Finally! I can now own Linux. (1)

91degrees (207121) | more than 4 years ago | (#29667577)

It leads to an interesting problem though. Suppose I sell you a copy of a GPL product and the source code on two separate CDs. You then sell Person B the source code CD and he sells it to person C. Is Person B obliged to provide the source to Person C on request even though he isn't capable for doing this?

Re:Finally! I can now own Linux. (0)

Anonymous Coward | more than 4 years ago | (#29669039)

It leads to an interesting problem though. Suppose I sell you a copy of a GPL product and the source code on two separate CDs. You then sell Person B the source code CD and he sells it to person C. Is Person B obliged to provide the source to Person C on request even though he isn't capable for doing this?

I think you mean binary CD there. In which case, yes, Person B is obliged to provide the source code since they are distributing the binaries. If they are distributing the source code CD, then they have no further obligation.

This cover right to SELL only, right? (2, Insightful)

gzipped_tar (1151931) | more than 4 years ago | (#29667365)

So what if I want to give my used license to a friend for free? I can still be sued by the software company and lose, right? What if I resell it for a token price of $1? $0.01? Or just give it away?

So how exactly does this work? (1)

misnohmer (1636461) | more than 4 years ago | (#29667449)

If there are conflicting precedents, the oldest one overrides? Does this automatically overturn the latter, conflicting precedent rulings as invalid? Does this also mean that once a precedent is set, the courts cannot ever rule differently no matter what, only congress can overwrite?

Re:So how exactly does this work? (1)

djjockey (1301073) | more than 4 years ago | (#29668037)

Generally... A higher court can overrule, and courts at the same or lower level must follow the prior decision (precedent). The facts of the case must be similar. If there are enough differences in the situation, then the court can make a different decision. This is how you can have different precedents that are referred to in the summary.

Without details, I would assume that there were two possible precedents that fit this particular case, in which case the older precedent applies.

Oh, and for the record, I dropped out of law school...

Isn't a fundamental aspect of this case... (3, Insightful)

L4t3r4lu5 (1216702) | more than 4 years ago | (#29667507)

... that he didn't use the software himself, and therefore was not bound by the shrink-wrap license? He purchased them for resale only.

Re:Isn't a fundamental aspect of this case... (1)

amplt1337 (707922) | more than 4 years ago | (#29669379)

That wouldn't matter. All that would do is say that the chain of legal ownership got broken from whatever source he bought the software. If the license is not transferable by sale, then "I bought it to resell" has no more validity than "the software fall off the back of a truck."

"Ownership society" vs. "Licensure society" (1)

dpbsmith (263124) | more than 4 years ago | (#29668357)

This is good. There is much to be said for and against an "ownership society" but I can't recall publicly advocating our transformation into a "licensure society."

I have no doubt that the same people who are trying to outlaw analog recording devices are planning a campaign behind closed doors for the eradication of "ownership" as a concept in U. S. culture, but they would never dare to say it in public.

Software licensing made sense when software was a semi-custom low-volume craft product; when there were small numbers of transactions and actual negotiations took place on every purchase; where the amounts of money involved were in six figures, and both parties had lawyers on retainer.

Today it makes no more sense than to say "this T-shirt is licensed, not sold" or "these skis are licensed, not sold."

mac os x on any systems and this ruling? (0, Troll)

Joe The Dragon (967727) | more than 4 years ago | (#29668577)

mac os x on any systems and this ruling?

Does this make even more legal to BUY mac os x and put it on any system? vs real black area that it is in now?

Does this help psystar computer in there case?

How about other software where they try to take away the right of first sale and try stop you from selling / moving software that you pay for to others?

Anybody sued for building their own Hackintosh? (1)

walterbyrd (182728) | more than 4 years ago | (#29668933)

I don't mean distributing, like Psystar does, I just mean building their own system. What would the BSA do if they came upon a Hackintosh?

Similar enough?! (2, Interesting)

Sloppy (14984) | more than 4 years ago | (#29669007)

One major consideration in that was the fact that the studio did not have the right, as it did in other agreements, to demand the return of the print.

The Court said that though the issue was complicated, software agreements were similar enough to those film agreements to act as a precedent.

Ha! So that's the "older' precedent? How about this? I walk into a grocery store, anonymously give cash to the cashier and walk out with a loaf of bread without having made any agreement at all, other than "I want the bread, here's some money." Retail software sales use the exact same transaction -- identical in every single way -- to what people have been doing for thousands of years. Thousands. And in all that time, Congress never bothered to pass a law that pulls a switcharoo on us and creates a difference between those transactions.

(Congress has passed some laws that creates some differences between what a person is allowed to do with a loaf of bread, versus a movie or software. But the sale itself, or giving rights to the original seller to demand it back? Nope. Some judges have created some new laws that treat the transactions differently, but Congress has kept out of that, so far.)

Long time ago (0)

Anonymous Coward | more than 4 years ago | (#29669443)

Slashdot. News for nerds. Six months late.

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