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- Copyright 1992 by S. Kitterman Jr. and the Las Vegas PC Users Group,
- 316 Bridger Avenue, Suite 240; Las Vegas, NV 89101. All rights reserved.
- This file was originally printed in the March 1992 issue of The Bytes of
- Las Vegas, a publication of the Las Vegas PC Users Group, and may be
- reprinted only by nonprofit organizations.
- Please give proper credit to the author and The Bytes of Las Vegas.
- -------------------------------------------------------------------------------
- Copyrights and Computer Software: Part V
-
- by Sam Kitterman, Jr., LVPCUG
-
- [The purpose of these articles is to give general
- information regarding copyrights and how they pertain to
- protection of software. It is not intended to constitute
- legal advice nor should it be relief upon to address a
- particular situation since the tone of these articles is
- general in nature.]
-
- When you buy software, what rights do you have? Generally
- speaking, a determination of those rights involve not only the
- Copyright Act but also contract and licensing law.
-
- When one purchases software, be it commercial "shrinkwrap" or
- shareware, one usually finds a "License Agreement" enclosed with
- the software. Indeed, many commercial manufacturers of software
- enclose the software in a sealed pouch upon which the Licensing
- Agreement is printed, i.e., preventing the purchaser from claiming
- lack of knowledge of the agreement since he or she should have read
- the license before opening the pouch. That licensing agreement
- determine a number of your rights to use of the software.
-
- What rights you may have under the licensing agreement will be
- dependent upon the language of that agreement. However, most
- licensing agreements follow certain "boilerplate" provisions such
- as:
- most agreements follow the general trend of allowing you,
- the "licensee" of that software, to install that software
- on one PC, and to allow you to make an archived
- copy/back-up of the software; and,
-
- most agreements also follow the general trend of denying
- you any right to install/use that software on more than
- one machine or to allow others use of that software,
- including making a copy of that software for their own
- use, e.g., the crime of pirating software.
-
- Again, the Copyright Act itself has put further limitations
- upon these rights.
-
- Under the doctrine of "first sale", a buyer of software
- previously had the right to rent, lease, or resell that software to
- others so long as he had first acquired possession of the software
- by purchasing it him/herself.
-
- Embodied in Section 109(a) of the Copyright Act, the "first
- sale" doctrine is as follows:
-
- Notwithstanding [other provisions of the Copyright Act],
- the owner of a particular copy...lawfully made under this
- title, or any person authorized by such owner, is
- entitled, without the authority of the copyright owner,
- to sell, or otherwise dispose of the possession of that
- copy....
-
- Indeed, this doctrine was the basis for allowing software stores,
- such as Omni Video here in Las Vegas, to purchase software and rent
- it to the public for a fee.
-
- Needless to say, copyright owners of commercial software
- became quite concerned at this apparent loophole in the law. Not
- only were they unable to collect any revenue from those rentals but
- furthermore, they became concerned that members of the public
- renting software would make unauthorized copies thereof and in
- doing so, would "rob" the owners of revenues they should have
- received when commercial software was purchased.
-
- Those concerns became so great that the commercial software
- industry lobbied Congress for an amendment to the Copyright Act, an
- amendment limiting the effect of this doctrine of "first sale".
- Needless to say, they succeeded.
-
- As of December 1, 1990, a new law went into effect. Known as
- the Computer Software Rental Amendments Act of 1990, that amendment
- changed section 109 of the Copyright Act to prohibit
-
- any person in possession of a particular copy of a
- computer program (including any tape, disk, or other
- medium embodying such program [from disposing of or
- authorizing the disposing of that computer program]
- by rental, lease, or lending, or by any other act
- or practice in the nature of rental, lease or lending.
-
- Please note: this law only applies to software purchased on or
- after December 1, 1990. Software purchased prior to that date is
- still governed by the "first sale" doctrine.
-
- Although this is a new law effecting the use of computer
- programs, it is actually tailored upon an earlier law, one known as
- the Record Rental Amendment of 1984. Enacted in 1984, that law
- applied similar controls to the renting, leasing or lending of
- authorized phonorecords.
-
- There are several exceptions to this Act.
- First, a purchaser of software may continue to dispose of such
- software by renting, leasing, or lending it where he has the
- authorization of the copyright owner for that program. Needless to
- say, whether obtaining such authorization is possible is highly
- questionable.
-
- Second, disposing of such software may be done where it is NOT
- for a commercial advantage, direct or indirect. For example,
- nonprofit educational institutions may continue to rent, lend or
- lease software to "faculty, staff or students".
-
- Nonprofit libraries may also continue to lend computer
- programs where such is done for a nonprofit purpose and where the
- library ensures that "each copy of a computer program...lent by
- such library has" the copyright notice affixed to the program's
- packaging.
-
- Third, computer programs embodied in certain "machines" may
- still be rented, leased or lent without violating this new law.
- More specifically, the law will be inapplicable to two types of
- computer programs:
-
- (1) computer programs embodied in machines or
- products "which cannot be copied during the ordinary
- operation or use of the machine", e.g., calculators,
- automobile electronic systems, etc.; and,
-
- (2) computer programs embodied or used "in conjunction
- with a limited purpose computer that is designed for
- playing video games"[e.g., Nintendo, Sega], including
- limited purpose computers that "may be designed for other
- purposes". However, if that limited purpose computer can
- be used for copying of computer programs, then such a
- system will not fall under this exemption.
-
- However, there is an interesting endnote to this particular
- law. It has what is called a "Sunset" provision, i.e., this law
- will self-terminate on October 1, 1997. Any rentals, leasings, or
- lendings of software after that date will not be in violation of
- this Act. It would seem that this provision was added so that this
- Act would coincide with the Record Rental Amendment Act of 1984's
- Sunset provision.
-
- In summary, if you purchase computer software since December
- 1, 1990 and you rent, lease, or lend it to others for commercial
- gain, you will be in violation of the law. Needless to say, this
- is a law that is being vigorously enforced by the industry, usually
- by the Software Protection Association.
-
- Needless to say, the moral of this lesson is: If you want to
- use commercial software, be legal or face the risks. Copyright
- infringement not only is prosecutable by civil lawsuit but also by
- criminal action brought against the infringer by the U.S.
- Attorney's Office.
-
- ----------------------------------
- Copyright 1992--S. Kitterman Jr.
-
- [Sam Kitterman, a member of the Las Vegas PC Users Group is an attorney
- with the firm of Quirk, Tratos & Rothel; he specializes in issues
- related to computer software. This is the fifth of a series
- of articles Sam is writing for The Bytes of Las Vegas.
- It was originally published in the March 1992 issue of The Bytes of Las
- Vegas, the official newsletter of the Las Vegas PC Users Group.]
-