Legal Issues

by Mike Masnick

You Can Only Resell This Software If You Think It Doesn't Suck

from the first-sale,-anyone? dept

One of the fun things in looking through all the issues concerning "intellectual property" law as compared to traditional property law is that the folks who are big supporters of intellectual property law always talk about how it's just like traditional property... until something about that doesn't meet their liking. Take for example, the concept of "right of first sale," where you can resell a product once you've bought it. That works great when you buy a chair, but people who bought digital goods face problems. Of course, that's a bit silly, because the resale value of a product often boosts how much people are willing to pay for it. The EFF is now discussing the story of a woman who tried to resell an expensive piece of software on eBay where the company threatened her for breaking the end user license agreement. The story is a bit complex, but basically, the company president contacted her anonymously asking why she was selling it. Her answer was that the software "sucks." She found out that the software company will sometimes grant the right to resell the software and various modules in "special" circumstances, so she asked for permission. The company president denied the permission for her to resell the product, noting that he was the anonymous person who she told her opinion of the software to. As the EFF notes, nothing in the "right of first sale doctrine" says that you need to ask politely to have the right to resell something that you bought. Using the EULA to punish someone -- especially after they found your product to be lacking -- seems to go well beyond what the EULA and copyright law was intended to allow.

Reader Comments (rss)

(Flattened / Threaded)

  1. identicon
    Griffon, Aug 23rd, 2005 @ 4:02pm

    No Subject Given

    The president the company has nothing better to do with their time? That should be the real story. Right first sale should simple be a given.

    reply to this | link to this | view in thread ]

  2. identicon
    Michael Vilain, Aug 23rd, 2005 @ 4:25pm

    Why not just ask for a refund?

    If she bought the product and it's not doing what she expects of it, why not just contact their customer service people and request a refund (and at the same time contact the credit card company to contest the charge). You get the full price of what you paid for the sucky software and don't have to go through eBay to sell it.

    reply to this | link to this | view in thread ]

  3. identicon
    scythe, Aug 23rd, 2005 @ 4:44pm

    Re: Why not just ask for a refund?

    the problem is, software companies are nefarious these days and would likely laugh in her face. They don't care if you won't buy more products you've already plopped down 400 dollars for a piece of software that you can't even re-sell because of the EULA.

    If there is any clear example of the sorry state of popular copyright this, and the slipknot case against Burger King are CLEAR examples of what is wrong with the system. The Burger King Case at worst is a parody, which used to be allowed without issue, now you have to ask permission of the original "IP" holder. If he doesn't like your parody he can deny your right to parody.


    reply to this | link to this | view in thread ]

  4. identicon
    DGK12, Aug 23rd, 2005 @ 5:25pm

    EULA rules

    A good question would be toward what end does an EULA server? Is it an agreement between two people of understanding, or an awful trick by the rich to use obscure knowledge to enslave the masses? Most people skip over the EULA because its long, wordy and doesn't make much sense. And those who have spent time reading them give up when they come across the line "We reserve the right to change this agreement at any time without having to notify the customer," or "We disclaim any dispute against us". What a wonderful pact between a ghost (entity that is corporation) and a person looking to get their money's worth.
    I saw a truck which reads on a sign on the back, "Stay back 100 feet. Truck is not responsible for flying rocks". Well forgive me for saying so, but I did not accept this agreement that a truck un-tarp-ed would be un-responsible for damage to my person or possessions. Even so, 100 feet is a bit far away for the size at which the sign was presented, (I had to be within 20 feet to read it). Further, does any pedestrian also agree to this? Does a flying rock come with the message attached?
    In the same sense, Eula's do this, by attempting to blind a person by boring chatter only to give them an agreement they don't agree too. And even if they did read it, they could not possibly know to which extent and all of which situations apply. It's so bad that now, if you purchase the wrong software or movie or music, you are stuck with it because stores will not accept the package (even wrapped these days!).
    It's utterly rediculous.

    reply to this | link to this | view in thread ]

  5. identicon
    u idiot, Aug 23rd, 2005 @ 5:32pm

    Re: No Subject Given

    A president of a company should be very interested when an individual wants to get rid of the software. This will ultimately lead to a better product. The second the president of a company ignores, or worse, doesn't find out about instances like this the company is doomed.

    reply to this | link to this | view in thread ]

  6. identicon
    Anonymous Coward, Aug 23rd, 2005 @ 11:12pm

    Same thing happened to me...

    I had a copy of AutoCAD that I wanted to sell. It was given to me, and I don't know how to use AutoCAD, so I put it on eBay.

    My action was pulled, and I complained. I got the email address of their IP lawyers and blasted them. Their position was that the EULA prevented me from 'transfering the rights' to another party. That's even if I never agreed to the EULA (I never installed the software, never even opened the box...). I dropped the whole thing and threw the software out since it wasn't worth my time to fight them. However, if anyone asks me, I'll be happy to tell them to say the hell away from AutoCAD.

    The net-net of it is that if someone wants to purchase a cheap old copy of AutoCAD, perhaps because they need to modify a single file or they were poor, they can't do it. And, so, the way people get cheap copies of AutoCAD is from alt.binaries.cad (or some such, plenty of places to get it), thus making it even less likely that they will ever pay money for a full legal copy of the software.

    These sorts of policies that suppress secondary markets are shortsighted. However, perhaps this will encourage more people to use Open Source, eventually depriving all the companies with these stupid policies of any revenue.... ;-)


    reply to this | link to this | view in thread ]

  7. identicon
    fsalley, Aug 24th, 2005 @ 3:20pm

    Reselling sucky software.

    Disclosure of the identity of of the sucky software manufacturer is the best method of dealing with bad products, and bad companies. Dissatified customers vote with their feet, and so do many who find out about them. They will get the message when all of their customers walk away to their competitors. What was the anme of the company in the instant article?

    reply to this | link to this | view in thread ]

  8. identicon
    Anonymous Coward, Aug 25th, 2005 @ 12:33pm

    No Subject Given

    Well any natural person that disses a corporation is going to find out the pecking order of things.

    reply to this | link to this | view in thread ]

  9. identicon
    John Tyler, Aug 26th, 2005 @ 3:43pm

    Need to talk to a lawyer

    Not to be rude, but you really need to read a basic law book, and PLEASE read this post before jumping on me. It is standard for software and digital content to have a EULA, and this does give the IP holder the right to impose whatever regulations they would like applicable to the software/content.
    As with your State's laws on violence, DWI, property transference or business regulations, ignorance of the law is no excuse. In the case of someone being mad because they cannot resell the software, it is their responsibility to read the EULA. Any restrictions in the EULA by law are accepted by using the software.
    In the case of the unopened software package mentioned in one of the comments, this should be allowed under the law of any state. Ebay is a little too gun-shy about things; you should hear some of the stories about physical goods that are banned because California does not allow them but every other state does.
    Generally, you as a user must be given the ability to see the EULA before being bound by it. That does not mean that you must accept it to be bound by it (by clicking yes or agree). If you do not accept it, you are still bound by it – the result, you can’t use the software.
    Personally, I believe that for any piece of software or digital content that the user should be given the opportunity to read the EULA prior to purchase. On some companies’ websites this is possible, but most do not allow it. One thing to note is that if you purchase a piece of software and have problems with it, even if the store/company will not take it back, you can almost always have your credit card company deny the charge – although, they will make you return the software (includes games) then.
    One additional thing to note is that similar restrictions can be placed on any physical good also. I can sell you the chair with a contract that requires that you never change the color of it. It is often common practice for deeds to home to have neighborhood association restrictions about parking a car on the street or even the type of holiday decorations you can use. My uncle even bought a house years ago with a stipulation that he could not cut down or otherwise cause damage resulting in the death of a particular tree on the property.
    People generally do not think about restrictions on physical goods because most physical goods do not have any restrictions on them, but they are possible and do exist. If you spent millions of dollars making a piece of software or even just spend your summer on a personal project, you have the right to decide how to sell it and with what restrictions. On the other hand, I, as the consumer, have the right to tell you to “stick it” and buy a competitor’s product. It is a balancing act.

    reply to this | link to this | view in thread ]

  10. icon
    Mike (profile), Aug 26th, 2005 @ 5:00pm

    Re: Need to talk to a lawyer

    Oh, that's a cop out. "It's in the EULA, so it's legal." The point wasn't the legal standing of the EULA (which, despite your claim, IS questioned by some), but that this is a clear misuse of the EULA going beyond the purpose of an EULA to spite someone who didn't like their software.

    reply to this | link to this | view in thread ]

  11. identicon
    John Tyler, Aug 28th, 2005 @ 12:59pm

    Re: Need to talk to a lawyer

    Not a cop out.

    If I am selling something that I or my company created, I have the right to put whatever restrictions on it that I want to. You also have the right to tell me or anyone else that puts to many restrictions on something to "go stick it". It is no different than the seller getting to decide the final price for a car, game, piece of software or baseball ticket. The buyer has the right to buy it at that price (just one of the possible conditions that can be set) or not. If you don't like it, then don't buy it.

    However, as I mentioned, I do not believe that consumers (or business customers) get enough chance to view restrictions for software (e.g. EULAs) before they actually have to spend their money. While you have the right to dispute the charge with your credit card company (if that is how you pay for something), that is too much work, and consumers do deserve better.

    reply to this | link to this | view in thread ]

  12. identicon
    Rich, Sep 8th, 2005 @ 4:46pm

    Re: Need to talk to a lawyer

    I assume there is no consensus as to whether those are enforceble restrictions.

    What if the software was obtained from someone's estate.

    The restriction locks in the original owner but not a subsequent owner then wouldn't principle of "first sale" apply.

    Another example: this is true

    I received a bill on my credit card from a company on the net. I do not remember the purchase so I inquired about it, they said I purchased a discount purchase plan. I ask why I never received the paperwork about the purchase and they said everything is on the net it is my responsibility to access the page that was shown when I clicked "yes". I asked why did I receive the bill 2 years later they said that is how they do it.

    Is that legal?

    I was trying to purchase an airline ticket through one of the discount airline travel companies. I paid for the airline tickets and received additional bills 2 years later.

    reply to this | link to this | view in thread ]

  13. identicon
    Rich, Sep 8th, 2005 @ 6:09pm

    Re: Need to talk to a lawyer

    If the s/w manufacturer required an activation key he could effectively render the s/w useless.

    When I was in College I could not afford to eat and when Wolfram Research offered Mathematica I was extremely interested in obtaining a copy - by hook or by crook. There was a used copy offered for sale at Ebay but I heard stories about their two part activation procedure I decided against purchasing it because I did not have enough money to gamble with. I still like higher mathematics and am getting fat yet still do not have any money and haven't been able to try mathematica.

    Officer Country.

    reply to this | link to this | view in thread ]

  14. identicon
    Anonymous Coward, Dec 15th, 2005 @ 12:08am

    Re: Need to talk to a lawyer

    Shut the fuck up

    reply to this | link to this | view in thread ]

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