Software Sale on eBay Satisfies First-Sale Doctrine


A federal court in Washington has issued declaratory relief that a plaintiff’s sale of authentic, used copies of AutoCAD software over eBay is not infringing, because the copyright author’s distribution rights in that particular copy have been exhausted under the first sale doctrine. Case name is Vernor v. Autodesk Inc., W.D. Wash., No. 07-1189, 5/20/08.
The court relied heavily on the Ninth Circuit’s 1977 opinion in United States v. Wise, 550 F.2d 1180 (9th Cir. 1977). Wise held that after “first sale,” a vendee “is not restricted by statute from further transfers of that copy.”  Wise had to do with motion picture film prints.  In relying on Wise, the court rejected other rulings issued the Ninth Circuit, [including a case we read in class MAI Systems Corp. v. Peak Computer Inc., 991 F.2d 511 (9th Cir. 1993)].  In rejecting the later opinions, the court said, “Where opinions of three-judge Ninth Circuit panels conflict, the court must rely on the earliest opinion.”
The facts in the present case – an AutoCAD “sale” on eBay, with onerous restrictions on use – was not a license, for purposes the First-Sale doctrine, which the court found similar to the Wise case.

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