[Note: This version contains updates to the original post published on 11/04.] We all know it takes place. While I type here, a number of people are bidding on a copy of AutoCAD Architecture 2009 on eBay. The item has received at least five bids. The latest bid is $510. At the same time, a copy of AutoCAD 2009 is awaiting openning bid. The seller has listed the beginning price as $2,000. I wonder if either of these sellers have heard of Timothy Vernor.
Vernor’s suit against Autodesk essentially brought to the forefront the complex issues surrounding software resale on eBay (read “Genie Out of the Bottle” in September Tech Trends column). To summerize, Vernor, a vintage comics collector and trader on eBay, sued the AutoCAD giant in August 2007. He claimed Autodesk repeatedly interfered with his trading activitie on eBay, resulting in the suspension of his eBay seller account for approximately 30 days in one instance. Autodesk, like most software developers, objected to Vernor’s attempts to put up used copies of AutoCAD on eBay for resale.
Autodesk declined to comment on my Tech Trends draft the last time I contacted them, but pointed out they uphold the Business Software Alliance’s (BSA) policy. BSA’s declares, “When you purchase software, you are actually purchasing a license to use it, not the actual software. . . . If you make more copies of the software than the license permits, you are pirating.”
According to the latest update, posted at CAD/Court, a site devoted to tracking legal issues related to CAD software, Autodesk and Vernor have reached an agreement to drop Vernor’s Second Claim for Relief. In the order filed dated Oct 29, their attorneys asked to dismiss this claim “with prejudice, along with the relief requested in the First Amended Complaint’s Demand for Relief numbered paragraphs 1, 2, 3 and 6.”
The section in question includes the following assertions made by Vernor:
- Autodesk’s license agreement prohibiting transfers of its software is unconscionable and unlawfully restricts rights guaranteed by the Copyright Act …
- Autodesk’s copyright in its software does not give it the right to prohibit resale of its lawfully acquired products …
- Autodesk’s use of and enforcement of its license terms are unfair methods of competition, unfair or deceptive practices, and unlawful restraints of trade …
Paragraphs 1, 2, 3, and 6 from Vernor’s previous Demand for Relief call for:
- Actual damages and punitive damages;
- Treble damages …
- Attorneys’ fees and expenses …
- Such other relief as the Court finds appropriate.
Owen Wengerd, who maintains the CAD/Court site, observed, “In the settlement, Vernor agrees to drop his demand for a declaratory judgement that Autodesk has no right to interfere with Vernor’s sale of Autodesk software, and his demand for an injunction prohibiting Autodesk from further interference. In exchange, Autodesk agrees to pay actual and punitive damages, attorney’s fees, and ’such other relief as the Court finds appropriate.’ Essentially Vernor got everything he wanted, as the court’s previous order denying Autodesk’s motion to dismiss is almost as good as an injunction. By settling this secondary claim for a relatively small amount, Autodesk can now focus its resources on the more important and far-reaching remaining issues regarding whether the software is sold or licensed, and hence whether the first sale doctrine applies.”
To me (someone with a limited understanding of how the legal system works), it seems the Court sided with Vernor, paving the way for other eBay sellers. But I suppose I, along with others, will have to wait to find out if these sellers can cite “The First Sale Doctrine,” as Vernor did, to conduct software resale on the online auction site in the future.
If you’re willing to entertain a few questions, please give me your responses on the following:
- Have you ever bought or sold used software (CAD or any other kind) on eBay?
- As a software buyer, do you feel you should have the right to buy used software? (Software vendors tend to argue that the original buyer holds a nontransferable license, not a product, thus the transfer is not legal.)
- When you no longer have use for a certain software, do you feel you should have the right to resell it?