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Garage sale genius juices software-hawking eBayers

Judge ignores Autodesk

Internet Security Threat Report 2014

The world's greatest CAD dowser has successfully defended your right to sell second-hand software.

Last fall, Timothy "Happy Hour" Vernor sued Autodesk for $10m, after the software maker barred him from selling second-hand copies of its rather expensive AutoCAD app via eBay. At the time, Vernor was flying without a lawyer. But his case was soon embraced by the legal minds at Public Citizen, and on Wednesday, a federal judge told the world that his AutoCAD sales are A-OK.

Vernor hasn't actually won his case - or received damages. But Judge Richard Jones has denied Autodesk's motion to dismiss the suit, and with this denial, Jones laid down some words that provide some added protection for eBay sellers everywhere. Not to mention other software-happy net merchants.

More than two years ago, Timothy Vernor walked into a "garage sale" and stumbled onto a copy of AutoCAD, a professional design tool with a price tag topping $4,000. He bought it on the cheap and promptly chucked it onto Happy Hour Comics, the eBay-driven online store where he typically sells comics-related collectibles and vintage toys.

But Autodesk didn't like that. The software seller fired a DMCA (Digital Millennium Copyright Act) claim at eBay, ordering the removal of Vernor's AutoCAD auction. eBay complied. But Vernor fought back, issuing a counter-claim, and in the end, Autodesk let the auction stand.

But then Vernor's CAD dowsing talents kicked into high gear. He nabbed four more copies of AutoCAD when a local architectural firm held another "garage sale." Naturally, he listed these on eBay as well, and in this case, Autodesk stuck to its DMCA guns. The company kept countering Vernor's counter-claims, and per site policy, eBay suspended his account.

That's when Vernor filed his $10m lawyer-less lawsuit.

Under the US Copyright Act, you can't sell duplicates of a copyrighted product. But you can sell the original, thanks to the so-called "first sale doctrine". And Vernor argues he was selling originals.

Meanwhile, Autodesk insists that the first sale doctrine doesn't apply because it doesn't actually sell software. The company claims it merely licenses software. Its licenses are "nontransferable," the argument goes, so it has every right to spike Vernor's auctions with the DMCA.

But Judge Jones doesn't buy that. "Mr. Vernor may...invoke the first sale doctrine," Wednesday's ruling says, "and his resale of the AutoCAD packages is not a copyright violation."

Vernor's lawyer views this as one very large win for online sellers. "eBay is the Wild West of copyright law," Greg Beck, of Public Citizen, told us. "Using the DMCA, companies can assert these copyright claims even if they don't have much basis in reality, getting sales terminated immediately. Your only recourse is to go to court, which is an expensive and time consuming process.

"This ruling is a protection for sellers who may not have the resources to go out and get a decision on their own."

Needless to say, Autodesk sees the ruling in a different light. "We believe it's incorrect," company spokeswoman Colleen Rubart told us. "We believe that software publishers are entitled to license software on an appropriate term."

Whatever Autodesk believes, Happy Hour Comics is now back in the AutoCAD business. And Tim Vernor just called to say he has two copies left. ®

Internet Security Threat Report 2014

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