1st sale doctrine legal battle

February 17, 2010

A few moochers have emailed me, as they noticed that I’ve been elected to Chairman of the Board of the EFF and they were surprised that I hadn’t blogged about it. Well, this blog isn’t about me, it’s about BookMooch, and I *try* to not be too self-serving with it, so I wanted to wait until I had something BookMooch-relevant to say about the EFF.

BookMooch couldn’t exist without the first sale doctrine. It’s the single most important aspect of law that keeps publishers from prohibiting things like BookMooch, where a book, once it’s been purchased and read, can be passed onto someone else.

The “First sale doctrine” says: “once you’ve acquired a lawfully-made CD or book or DVD, you can lend, sell, or give it away without having to get permission from the copyright owner.”1

Fred Sm
A few days ago, EFF poster-boy and intellectual-property wunderkind Fed von Lohmann posted a short article about a recent challenge to the first sale doctrine.

The case is about a software company trying to use copyright law to stop their software program from being sold via ebay. The article writes:

When Mr. Vernor tried to auction four authentic, packaged copies of AutoCAD software, Autodesk sent DMCA takedown notices to block his auctions and threatened to sue him for copyright infringement. Mr. Vernor, assisted by the lawyers at Public Citizen, took Autodesk to court and won.

now this is the really interesting bit:

Autodesk has appealed, arguing that so long as its license agreements recite the right magic words, it can strip purchasers of any ownership in the CD-ROMs on which software is delivered. If that’s right, then not only don’t you own the software you buy, but any copyright owner can simply recite the magic words and effectively outlaw libraries, used bookstores, and DVD rentals, among other things (eBay also filed an amicus brief on behalf of Mr. Vernor).

The EFF have another ongoing case regarding the re-sale of CDs, which also makes interesting reading on the topic.

39 Responses to “1st sale doctrine legal battle”

  1. Claire T said

    I can see how they could argue about software – you’re given a licence – but surely not books/CDs…. Also, one or two books I have had are labelled NOT FOR RESALE? Does anyone know why? I know charity shops won’t touch these but I’m assuming these are OK for BookMooch because I’m giving them away? Interested on anyone’s thoughts.

    • Lottie said

      Regarding “Not For Resale” – it’s usually when they’re sold as part of a set – eg, free with a magazine, or in a box set, sold cheaper. I think (I could be wrong) the vendor isn’t allowed to split up the set and sell them separately. The barcode is usually left out to make it harder.

      Correct me if I’m wrong. 🙂

      • Sarah Wrightson said

        Not For Resale on CDs and books is usually because they have been sent to reviewers or are advance reading copies, or sent to radio stations in the case of CDs. These are legally the property of the publisher or record label. Though they never do they can require the return of them.

      • Tzctlpc said

        Yes, but once you buy it, then you should be able to resell it on its own, shouldn’t you?

      • Tzctlpc said

        Sorry for replying twice.

        I have just bought a newspaper with a free book, the book is marked “not for sale”.

        To which I say: you wish.

  2. Margot said

    Forwarding to Nick. 🙂

  3. Katy said

    That is insane. Autodesk is treading a dangerous path–I certainly hope they don’t succeed. I like trading books with people and buying used books and dvds.

  4. Tim said

    Seriously? WTF? The media industries themselves are the ones creating their own downfall. Not the minority percentage of people who illegally pirate their material.

    If the first sale doctrine is ever revoked, I wouldn’t be surprised to see pirating increase exponentially. When a consumer no longer owns what he or she legally purchases, why bother to do so in the first place?

    What happens when the publisher seizes my limited edition collection of books because I am not using them (i.e. selling one from time to time) according to their guidelines? Madness.

    John, thank you for working with the EFF and doing what you can to stop the corporate insanity. Your work with and the foundation itself is appreciated.

  5. Shelley said

    And I will be in line to buy those pirated copies. This is the most ridiculous thing ever. I guess Fahrenheit 451 is possible, huh, though in a more figurative way? I suppose one of these days I won’t have any books either way. They may as well be piled in the street and burned.

    Come get me Big Brother! I’m ready for you!

  6. Kevin said

    When libraries are outlawed, only outlaws will have libraries.

  7. sue. (greywarrier) said

    hi there, to me could some 1 define what ownership of a product means. to me as it stands. you buy a product and you own that product…. as long as you do not copy to sell for money. and the magic words here is COPY.. muliple versions of said product to sell.
    what you do with the origanl item , should be up to you the owner, to depose of how you wish. but may be i have it all rong. but who knows you guys will set me straight sue.

  8. Ron said

    In the overlap of books and software sits the “e-book”, or perhaps “Kindling”, after its primary conduit. I just read an op-ed piece, I think in the Wall Street Journal, reminding readers that books, or book “content”, in that form are rented rather than bought outright. Of course, this being the WSJ, the author didn’t question the right of publishers to offer their product that way; only the sense of the reader who takes them up on that offer.

  9. The webcomic XKCD once did a wonderful strip that’s rather remiscent of this. Something along the lines of, “If you pirate something, it’s yours forever. If you buy it legally, DRM will eventually make it worthless, and if you try to make it usable again, you’re a criminal. So, buy or pirate? Pirate! You’ll be a criminal either way.”

    Now, needless to say, this sarcasm was aimed at the frustration that is Digital Rights Management, but it stands relevant to the issue that is the “first sales doctrine,” too. If that’s taken away . . . yes, of course piracy will increase exponentially, and with good reason. People don’t like having their rights taken away, particularly if their rights are taken away just to line another person’s (or company’s) pockets. And, frankly, we can’t blame each other for that one bit!

    So, yes. Take away “first sales” rights, and you increase piracy a whole ton, which is not a good idea. The point of copyright is supposed to be to protect creators (which is a very good thing), not to hurt consumers (which is a very bad thing). I agree, in theory, that it would be nice for authors to have a chance of getting something more from a terrific story after it’s been printed and sold out new, for instance — but not at the cost of damaging reselling rights, or taking away people’s ownership of their things. If there is a way for authors to gain something (other than new readers, which in itself is nothing to sneeze at) from resellings, it would need to be much more indirect and voluntary.

    Congratulations on being made Chairman of the EFF, John Buckman. You rule. We so appreciate the efforts you put forth in making the lives of people better all over the world, with BookMooch, with charities, with this, with everything. You are a great leader and an inspiration to many.

  10. Rosemarie (Freecyclor) said

    Congratulations, John, and thanks. Good grief! I just went over and looked at some of the issues EFF is currently battling. Fascinating reading.

  11. Eric said

    Autodesk undertakes the most aggressive industry efforts to prosecute folks for violating its copyright / licenses. I have litigated against them in the past, and they are brutal and ruthless.

    Some software copanies are starting to limit the number of installations which can be made from a particular CD. Electronic Arts did this with Spore, recently, where, even if yo uowned the CD, you could only install it so many time (5 I think). They would track the installations by the CD Key numbers. I think they did this to restrict sharing, as well as limit piracy, where keys are shared in a community for various copied CD’s.

    There is a huge balance between restricting use and making a fair profit from publications and sales.

    I think that publishers have such a new frontier with the Kindle and similar products, where they have reduced production and distribution costs, with naturally limited sharing based upon the device, that publishers may not press this issue.

    Thanks for everything you do, John, and thanks for keeping us informed.

  12. Martyna said

    Entirely unrelated topic:
    I’ve tried to search Japanese titles/authors on the side and find it is unable to proceed the characters. (As it puts out garbled random signs and an non-effective search.)
    Is there any way to improve this? It would be very time-consuming to search for the ISBNs first and then here for possibly interesting books…

  13. darabuc said

    I write children’s books and I’d be pleased to know someone is willing to lend them or give them because they do not use them anymore, but they think they’re worth it. If this attack against the simplest ownership of things is how the industry wants to protect authors… well, I’d rather be unprotected, thanks!

  14. Dorothy said

    AutoDesk probably had a clause in the license agreement that said the software could not be sold. By installing it, the purchaser agreed to this clause, and should be bound by it. ALWAYS READ THE LICENSE AGREEMENT SO YOU KNOW WHAT YOU ARE AGREEING TO! If you don’t like the conditions of the license, don’t buy, but don’t agree not to sell and then scream when you try to and are thwarted.

    • Molly said

      My experience with commercially available software is that you don’t get to read the license until you have already ‘bought’ the software. Rather than printing the license info on the package, the publishers prefer to make you agree to the conditions during installation. And once the package is open, many vendors will only replace a bad copy, not refund your money. Long live open source!

  15. Rosemarie (Freecyclor) said

    Speaking of e-issues and privacy:

    “According to the filings in Blake J Robbins v Lower Merion School District (PA) et al, the laptops issued to high-school students in the well-heeled Philly suburb have webcams that can be covertly activated by the schools’ administrators, who have used this facility to spy on students and even their families. The issue came to light when the Robbins’s child was disciplined for “improper behavior in his home” and the Vice Principal used a photo taken by the webcam as evidence…”

    This is very, very wrong. And not from some redneck fundamentalist area, but from a district with an educated population; wealthy enough to issue laptops to all its students.

  16. Emma said

    I know that many stores will not let you take back or trade in used software. I always thought they were protecting against piracy. It is extremely easy for even a novice user to make a backup of a piece of software and then return or sell the original. That isn’t the case with books which are still mostly in physical form. Maybe I’m being naive but I’m not too worried about the sale of used books being banned.

  17. Tim said

    Dorothy: “ALWAYS READ THE LICENSE AGREEMENT SO YOU KNOW WHAT YOU ARE AGREEING TO! If you don’t like the conditions of the license, don’t buy

    That is a ridiculous statement. When is the last time you were able to read an End User Licensing Agreement without first purchasing a product and trying to use it?

    Maybe they need to place a warning label on the front of all software packages stating the major points of their EULA. Or tie it into the POS system with the store so you have to read and sign it at purchase. Then no one can say they were mislead. ALTERNATIVELY, companies could continue to allow the consumer to actually OWN their own purchases. What a novel idea!

  18. CD said

    John,
    Bravo to you and kudo’s on your nomination and election. I’d like to comment if anyone can take something and make something positive, it certainly would be you. Congrats!

    I truly don’t make public comments on issues but have been directed to support this cause. Please forgive the length of this post. I’ll try to remain short and sweet but bring some issues to attention.

    Agreed,It’s a sad situation. Could this be the rolling effect of that “little event” or as I call it “Uh-Oh Spagetti-O Day. ”

    It was the day Microsoft’s top cheese announced “how to make use of idle services, software and bandwith on average consumers PC’s to stimulate the digital economy.” I think we should have gotten it then. That whole spew is still archived on the net and worthy of a good listen.

    The license agreements I have been seeing of late also include: “if for any reason you fail to update we have the right to invalid your license.” Oh great,(here’s where I start losing sweet) so the update requires a service that breaks a system.

    Then the other one still one of my archived favorites is ” if you share this, them you can only share it with ten people which enables us to “test services infinitely ” on your system. If damages occurs, we can be liable for (started at 5K then (R&D being who they are and what they do really damaged the system) and currently reads ($5.00) after consumers brought it to their attention. That’s worth a good sputter of coffee or even a hearty giggle! I had to print that one as the license changed, re-authorized itself and agreed without the help of the mere Caveat Emptor.

    This practice isn’t just coo-coo for Cocoa Puff’s ™software active. It has spread (like is it antivirus?or virus) to hardware, PC operating licenses and has attached itself to the virus companies.

    Consumer’s basically are renting their PC’s and software in most of the licenses they acquire. Virus companies are a real treat. Some being what I consider “turncoats of the IBM-DOS countermeasure of resistence”.

    Some(shh-hush-hush) manufacturer’s pack the PC’s with spyware and if it’s removed, say Bingo! it is the blue screen of death. Not sure, what I won but it took about ten hours after each Bingo….

    Other’s license declare you can never change the original owner of the system (license and BIOS related) and it is the Manufacturer/Owner/Licenser of the Hardware. They make it, they can break it, use it, abuse it and let someone else pay for their R&D. That’s good for a “duh Blonde joke” about a minute for me. Sadly, it’s reality for more than a minute for most of PC community.

    In most cases that name on the PC front owns the hardware, then the Operating system (other name on the screen) owns the operating system. Wow, now not only do they own what I bought, they keep using it in one way or another. Wow, hope those two don’t fight very often.

    On a final note, if you’d hear from me again, KAOS has confiscated my shoe phone. Perhaps they had BlueTooth or remotely activated self destruct log’s.

    In any case, let me make sure my shoe modem is not being tracked for international shoe polish.

    Good luck to you John.

  19. Carrie said

    Actually, if you read the original article, the Autocad software was in its original packaging- never been opened or installed and it was verified as authentic.

    • Bekah said

      Perhaps I’m not aware of the finer points of the legal issues here, but if the software was unopened in its original packaging, then how could Autocad possibly claim that its End User Licensing Agreement had been violated? If the package had been unopened, the agreement wasn’t activated and nobody agreed to anything.

  20. Fred said

    The case doesn’t have any affect on book sales. Autocad is suing based upon the license agreement the the user (i.e., contract law), not strictly on copyright law. Software makers have traditionally bundled their works with contracts which impose additional conditions upon the use, including a waiver of First Sale rights under the Copyright Act.

    Books, however, are not subject to any such contracts. And thank goodness. Can you imagine having to agree to a three page small-print contract in order to open up a book?

  21. Celeste Achterhof said

    This argument when carried to its natural conclusion would mean that no one ever would own anything you buy…ever. You don’t own the blender you buy..you can’t resell it because the company that designed and made the product wouldn’t make money on the subsequent sale. If the DMCA had its way, the original creator of every item would maintain an interest in that product FOREVER. We would technically be renting the right to use everything that we purchase. It is insanity. If I want to rent something, say a movie, I rent it and give it back. If I want to control that item’s ‘future’ then I purchase it. Once I purchase it and have paid for it…it is mine. I own it and should be able to control what happens to it.
    Just think, you would never own the home you paid a mortgage on for thirty years, or the car you buy. The original creator/copyright holder would have all control over where that product went for eternity. There would be no incentive to purchase anything legally anymore and since many countries have no copyright laws protecting American artists or manufacturers, folks would buy their products from one of those countries, sending more money from US industries and into the coffers of another country. Sounds great for jobs here doesn’t it?

  22. Celeste Achterhof said

    An addendum to the note above. In fact, stores like Wal-Mart and Sears…all stores would be breaking the law simply by putting the products on their shelves to sell to consumers. The ONLY people who would have the right to sell software or books or anything else, should the law be allowed to follow its natural course, would be the original person who created the product. There could be no resale, no wholesale stores, no manner to sell anything by anyone except the original creator of the product. They would be the only folks allowed to profit from their products. After all, what right would a Wal-Mart say, have to sell the product? They purchased it for resale, as did the folks in the AutoCad story above. So while the argument might be made that they had the right to be the ‘first purchaser’ they simply do not and could not have the right to sell the product to you or I. Any law, when carried to the extreme, becomes insanity and the DMCA is noted for bringing insanity in interpreting the law to the forefront in this country. In their zeal to protect their profits, they are driving consumers underground…assuring them angry consumers and guaranteeing themselves less profits in the future.

  23. Cariola said

    Re: “Not for Resale”: As a university professor, I receive a lot of exmination copies and instructor’s desk copies, many of which are so marked. The reason is that the publishers provide these books free of charge, intending to make money off the sales of books that are adopted. Some are now asking that we return a book we don’t plan to use; others are making us pay a fee for them either upfront or after 60 days.

    Of course, we can’t prevent our students from getting their books used at a cheaper rate, which many of them do.

    There’s now some weird new federal law that our chosen textbooks have to be posted on the university’s book store web page before scheduling begins. I’m guessing that is so students can start scouting out cheaper copies ASAP, and that Amazon or some other outfit has been complaining about the bookstores having a monopoly. So I will have to decide on my textbooks by March 1 for classes that don’t begin until the end of August.

    Another issue publishers are facing is students “renting” books online. This does seem to me to be an outright violation of copyrights.

    • Ellie said

      You can rent ebooks onlien through Safari bookshelf I believe and it’s all legal. My boss reads IT books this way, I think he pays a subscription rather than one off fees though.

  24. JB said

    The mind envisions an almost-ridiculous world where secondhand books are smuggled from one friend to another in violin cases and coat liners and read furtively by flashlight in moldy basements and claustrophobic closets.

    So many of the comments here naively assume this could never happen to us. Nor could pat-downs and electronic strip searches to use public air transport, nor ordinances requiring store cameras connected directly to local police stations, nor national security letters allowing the FBI to peruse private reading lists in secrecy without a court order, nor copyright laws that protect written ideas for more than a century–enough to guarantee the great-great grandchildren of the author (and, of course, the publishing houses) reap a reward from the long-dead writer’s hard work.

    Don’t think it’s funny that licensed “hard products” like appliances, electronics, automobiles and even houses could appear in the future. It’s the “servisication” of everything–the way to assure a virtually perpetual income stream from any effort along with control of the behavior of the customer who buys it and the obsolescence of any product (by requiring return of the product when it reaches a certain age for recycling, for example).

    Media companies now license for perpetual fees bits of original work as small as sound fragments, pre-emptively charge barber shops annually for music the industry assumes will be played within customer earshot on the premises and are working hard to scramble entertainment equipment signals even to the extent of making it impossible to photograph an image on your own television screen. The technology to prevent copying of book pages can’t be far behind–just try making a color copy of a $5 bill if you don’t believe me. Most color copiers now correctly identify the bill and refuse to make a copy.

    In an era where the incremental cost of publishing most forms of creative work is nearly zero and where traditional production and distribution companies should be taking a smaller and smaller piece of the pie, costs are actually increasing.

    Books have been the last holdout, but publishers are greedily eyeing the written word with a mind to following the RIAA, MPAA and all the other media organizations to the nirvana of permanent residuals on every single viewing of any part of a work. Epublishing to readers like the Kindle is only the tip of the wedge. Pressure must and will be exerted against paper media “licensees” (owners), and don’t think this applies only to future products. Digital ink will make it possible to produce “read once” pages, sure, but court shenanigans a la DMCA will try to retroactively require fees to use any work anew.

    Fortunately, this is one of the toughest problems to solve as readers, intensely loyal to particular authors, won’t just switch to different books to avoid fees; instead, they’ll resist mightily having ideas so taxed.

    Or so I hope. I’ve been consistently disappointed in the lack of interest by the pivotal “Millennial Generation” in denying service fee architectures for every experience from so-called “license fees” folded into the cost of broadband service or spindle of blank optical discs to required annual or even per-usage payments for software. Maybe that’s no surprise; anyone who’s willing to pay $100 a month on a 2-year contract for service on a $200 iPhone won’t flinch at being charged a $120 per year “media fee” on the property tax bill, payable to your local library, who duly remits it to some national media publisher’s association in payment for the use of the library of books that taxpayer is assumed to possess in her own home.

    When I grew up in the 70s and 80s when we feared and fought the menace of communism. Who would have dreamed that it would be rampant capitalism perpetrating such thought control in the twenty-first century?

    Anyway, John, keep up the good work and thanks for making us aware of this.

  25. Melanie Wardlow said

    Hi-

    That is great and congratulations! I am wondering if this will have anything to do with bookswapping on this site or other bookswapping sites that are out there?
    Thanks,
    Melanie Wardlow

  26. Andrea Richmond said

    Damn Republican’ts, (a new word!)
    They’d take back food from you if they could & You’d let them.

    You can chew it but can’t swallow it. Is a lot like -> You can read it; But, It’s not Yours.

    We are Capitalists! Not Communists! We buy things AND THOSE THINGS ARE OURS.

    Perhaps we too can use strong appeals to our peoples finer values and traditions to safeguard the simple yet sublime elegance of owning and giving books, buying and selling or trading,or bartering books.
    The next step of that mindset would be to OUTLAW LIBRARIES! Is nothing sacred? I am a Librarian & we have ALWAYS been the freedom fighters of Democracy.
    Please join our cause…

  27. Marcus said

    While I agree that this is a problem, I suspect that even if the publishers make resale illegal all that will happen is that more and more of us will read e-copies of books. If the publishers do manage to find a way to prevent scanning, splendid patriots worldwide will simply type in a chapter per person and-voila! a non-protected e-copy. The more you make intellectuals angry, the more ways they find around you and your product to start with.

    I am more alarmed by the notion of software companies being able to discontinue service at will simply because you don’t want to update. An example would be WMP. It’s long been suspected that Our Father at Redmond has built in a way to become aware that users are playing copyrighted product without a license. Save yourself, become familiar with open source and don’t automatically take what Microsoft offers without thinking!

  28. So the question becomes at what point do you have ownership of something of creative origin? With that argument it could easily get to the point that clothes couldn’t be sold or even used kitchen appliances. Very few products (in contrast to raw materials) are without some creative component.

    Even art is able to be bought and sold, despite the fact that ‘reprint rights’ are considered separate from the artwork itself. So in that regard, I can understand (and expect most readers here do as well) that we could resell, gift, donate, a book that has been properly produced but we can’t reproduce that work ourselves and sell, donate or gift it.

    As to the software… if the product is still including unused licenses, I hardly see the issue. Again, once those licenses have been used – if the product has to be tampered with (as in hacking to get past that security device of limited licensing and codes) then the violation is for tampering with the security, not the resale of the software.
    It’s sad that this is even a point of contention.

  29. Dale said

    Just a quick note that not all countries have the “first-sale doctrine” (which, oddly enough, came up in conversation yesterday at my job.

    While I haven’t researched the subject, I believe that British (and other) libraries pay fees (much like the ASCAP system in the US for music) to publisher for lending materials.

    As a public librarian, First Sale Doctrine is vitally important to me and to the health of US libraries.

  30. Sandra said

    I can understand that an author needs copyright laws for protection agains’t piracy, but once i buy a book, a cd or dvd they are my property i paid for them, and if i want to lend or trade said property it’s my business. To say that i cannot do that is to violate my freedom , my rights.

  31. Kat said

    hey John,

    just had to cancel a pending book since ive not heard back from the sender who “accepted” to send it. the book was not readded to my wishlist & i just wanted to make you aware of that. is this a glitch? im thinking it is since i dont remember having to add books ive cancelled in the past.

    thanks for all your great work!
    Kat

  32. Fanees said

    But how about international sales? Is bookmooch is the place where you can exchange your copies of books in foreign language? My question is how book can be checked on correspondence with first sale doctrine?

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