Timothy S Vernor v Autodesk Inc., US Case
Mr Vernor purchased genuine copies of Autodesk software from licensed users for sale on eBay. Autodesk alleged that such sales amounted to software infringement.
The US district court held that the "first sale" doctrine applied, i.e. where a copyright holder chooses to sell a copy of his work, he exhausts the statutory right to control its distribution, so that the owner of a lawful copy of the copyrighted work is entitled to sell it (but not to exercise other prohibited acts such as copying the work). The decision was based on a case called Wise where the Court took the view that wherever there was no requirement for the recipient to return licensed materials(in this case, film prints), then the transaction amounted to a sale rather than a licence, not withstanding that other terms were imposed on the recipient of the materials.
The US Court of Appeals for the Ninth Circuit allowed the appeal and overruled the first instance decision. The Court of Appeals held that, because Autodesk reserved title under its licence agreement, its customers were licensees of their copy of the software, rather than owners. As the licensees did not purchase the software as owner, it followed that they could not evoke the first sale doctrine.
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