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Marc Temin, Foley Hoag LLP ABA Litigation Section, Copyright Litigation Subcommittee, May 6, 2010 - page 2 / 12

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  • II.

    Sales and Licenses of Software and Copies

    • A.

      Why are copies of software not sold but licensed?

      • 1.

        To avoid first sale doctrine, control further transfer of copy

      • 2.

        To specify and limit scope of use (and so of necessary copying)

      • 3.

        To avoid application of law of sales

      • 4.

        To permit addition of contractual terms

    • B.

      Possibilities

      • 1.

        Sale of copy and no license. Owner of copy has rights under §§ 109 and

117 but no other § 106 rights.

  • 2.

    Sale of copy and license of software. Owner of copy has rights under §§109(a) and 117). License may restrict or expand copying permitted under § 117.

  • 3.

    License of copy and software. Licensee of copy has no rights under §§ 109(a) or 117(a). License determines rights both to copy and software.

  • C.

    License grant alternatives

    • 1.

      License grant with conditions

      • a.

        Conditions precedent

        • i.

          Once conditions met, license effective

      • b.

        Conditions subsequent

        • i.

          Termination if conditions not met? Automatic or upon

notice (and perhaps failure to cure)?

      • ii.

        E.g., automatic license termination if software transferred?

  • 2.

    License grant with additional covenants

    • a.

      Breach of covenants is not breach of condition, but material breach

may permit termination of license agreement

  • 3.

    Implied license

    • a.

      Asset Marketing Systems, Inc. v. Gagnon, 542 F.3d 748 (9th Cir.

      • 2008)

        – provision of software under technical services agreement gave rise to implied unlimited nonexclusive license to use software

  • -

    2-

Marc Temin, Foley Hoag LLP ABA Litigation Section, Copyright Litigation Subcommittee, May 6, 2010

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