Legal News

Ninth Circuit ruling limits first sale doctrine

By Richard Binder

Timothy Vernor, a regular eBay seller, put four copies of the software Autodesk on eBay and was sent a DCMA takedown notice for each one.  Vernor counternoticed every time, and when Autodesk failed to respond the auctions were reinstated. After the fourth takedown arrived, eBay suspended Vernor's account.  Vernor sued Autodesk, saying he had legally obtained his copies and had a right to sell them.

U.S. District Court Judge Richard Jones in Seattle ruled in favor of Vernor, saying that Autodesk could not restrict his first sale rights. But on Friday, the Ninth Circuit threw out that ruling, saying that software makers could use shrink-wrap and click-wrap licenses to forbid the transfer or resale of their products.

Writing for the court, Judge Consuelo M. Callahan explained that "a software user is a licensee rather than an owner of a copy where the copyright owner (1) specifies that the user is granted a license; (2) significantly restricts the user?s ability to transfer the software; and (3) imposes notable use restrictions."

Vernor's lawyer, Public Citizen's Greg Beck, plans to ask for an en banc reconsideration.

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Full post as published by Legal Pad | LA on September 13, 2010 (boomark / email).