Right to Resell Software Reaffirmed

The court case, Timothy Vernor v. Autodesk, Inc., was fairly simple: Mr. Vernor bought old copies of Autocad, one at a garage sale, and three from an architectural firm, and Autodesk sued, claiming that he violated the terms of the license.

Mr. Vernor asserted the right of first sale, which allows a person who has purchased a copyright work to resell it, but Autodesk claimed that it was not a sale, but a license.

The judge was having none of it, see here, here, and here, and ruled on behalf of Timothy Vernor, noting that Autodesk does not require an annual payment, or to return it when done.

Additionally, Autodesk was done in by their own sales literature and web site, which referred to purchase options for buying the sortware.

Note that this is bigger than it sounds:

If Jones's ruling is upheld on appeal, it will have important consequences for the software industry, where the legal fiction that software is merely licensed is widely employed. In addition to discouraging the market for used software, software firms have also attempted to use the "licensed, not sold" theory to enforce restrictions on reverse engineering that would otherwise be fair use under copyright law. If software is sold, rather than licensed, then no license is required to install and use the software, and the terms of shrink-wrap licenses may not be legally binding.

Of course, the vendors could get around this by going with a real annual license, but in the real world of PC software, with a very few exceptions, you would eliminate 90+% of your customers if you did that.