SCOTUS: Patent Rights Over a Printer Cartridge Are Exhausted When It Is Sold • Hacker News Board

Re: SCOTUS: Patent Rights Over a Printer Cartridge Are Exhausted When It Is Sold

#171

Post by desiderantes » Tue, May 30, 2017, 7:44 PM UTC

njarboe wrote: post #165

exelius wrote: post #111

Earlier quoted context omitted.

I think that this distinction is largely becoming irrelevant in the cloud era. Most software is sold / licensed on a term basis these days, and honestly the industry is healthier as a result. App stores are really the only remaining vestige of "buy once, use forever" -- and I'd guess that the EU isn't interested in going after it thanks to the small dollar amount and huge number of companies who benefit. Software was…

It would be interesting if food was sold this way. Instead of an upfront purchase of atoms and molecules, you license their use and pay a monthly fee. It would be a bit hard to tell which exact atoms came from each food consumed with current tech, but one could do estimates of the expected half-lives of various atoms and molecules in the human body and have people agree to pay according those rates. This would defini…

Until you reach a point where most of your atoms come from them, and you are their property now. Great! Why do people here propose the most obtuse and shitty dystopian scenarios for everything?

Re: SCOTUS: Patent Rights Over a Printer Cartridge Are Exhausted When It Is Sold

#172

Post by Steko » Tue, May 30, 2017, 7:45 PM UTC

test6554 wrote: post #166

Steko wrote: post #141

Earlier quoted context omitted.

I wonder if this will affect the various Qualcomm suits. Qualcomm tries to collect patent royalties from (say) Foxconn based on the sale price between (say) Apple and the carrier/consumer. Edit: moved long commentary from FOSS blog to separate thread: https://news.ycombinator.com/item?id=14448205

If Apple purchased Qualcomm chips and then resold them as part of the iPhone, then it might affect those suits, but this is not the case. Apple licenses proprietary Qualcomm technology from Qualcomm. Apple uses the technology, but builds its own chips.

No Qualcomm's licenses are with Foxconn et al. Apple has been negotiating for a direct license but they haven't reached any agreement:

http://www.reuters.com/article/us-apple-lawsuit-qualcomm-idU...

Qualcomm apparently filed an amicus brief in support of Lexmark in this case:

http://www.scotusblog.com/wp-content/uploads/2017/03/15-1189...

Re: SCOTUS: Patent Rights Over a Printer Cartridge Are Exhausted When It Is Sold

#173

Post by Spooky23 » Tue, May 30, 2017, 7:45 PM UTC

exelius wrote: post #111

touchofevil wrote: post #48

If you want to learn about a really interesting aspect of the "first sale doctrine" and how it applies to software, you should have a look at "Vernor vs Autodesk" in the USA and compare it to "Oracle vs UsedSoft" in the EU. Basically, in the USA the courts determined that if a company sells you software, but in their terms & conditions claim that they are merely granting you a license, then you can't resell the softw…

I think that this distinction is largely becoming irrelevant in the cloud era. Most software is sold / licensed on a term basis these days, and honestly the industry is healthier as a result. App stores are really the only remaining vestige of "buy once, use forever" -- and I'd guess that the EU isn't interested in going after it thanks to the small dollar amount and huge number of companies who benefit. Software was…

s/industry/some software vendors/

The loss of perpetual right to use is a devastating and nasty impact on the industry to customers. I've been involved in big hairy nasty disputes from massive vendors of cloud services -- they have you over a barrel in the way the IBM did in the bad old days.

Re: SCOTUS: Patent Rights Over a Printer Cartridge Are Exhausted When It Is Sold

#174

Post by tunap » Tue, May 30, 2017, 7:46 PM UTC

taeric wrote: post #150

exelius wrote: post #111

Earlier quoted context omitted.

I think that this distinction is largely becoming irrelevant in the cloud era. Most software is sold / licensed on a term basis these days, and honestly the industry is healthier as a result. App stores are really the only remaining vestige of "buy once, use forever" -- and I'd guess that the EU isn't interested in going after it thanks to the small dollar amount and huge number of companies who benefit. Software was…

The industry is healthier as a result? I question that rather strong claim. Consider as a counter point, I can still pull up cartridge based games on my old consoles and they work. Rather well, actually. Now, that does speak only to the "health" of the software I run. It also ignores the implications of this world we are in where everything is fully connected to the internet. To your point of healthier for the develo…

To add to your counter-point, the consumer also gets rent-seeking companies locking the consumer into a proprietary system to extort you to pay more, more often(eg:Intuit). That is, if the provider doesn't shut down the platform b/c it isn't profitable enough(eg:Cubby), new investors ruin the product or they go out of business for myriad reasons.

Re: SCOTUS: Patent Rights Over a Printer Cartridge Are Exhausted When It Is Sold

#175

Post by ada1981 » Tue, May 30, 2017, 7:47 PM UTC

njarboe wrote: post #165

exelius wrote: post #111

Earlier quoted context omitted.

I think that this distinction is largely becoming irrelevant in the cloud era. Most software is sold / licensed on a term basis these days, and honestly the industry is healthier as a result. App stores are really the only remaining vestige of "buy once, use forever" -- and I'd guess that the EU isn't interested in going after it thanks to the small dollar amount and huge number of companies who benefit. Software was…

It would be interesting if food was sold this way. Instead of an upfront purchase of atoms and molecules, you license their use and pay a monthly fee. It would be a bit hard to tell which exact atoms came from each food consumed with current tech, but one could do estimates of the expected half-lives of various atoms and molecules in the human body and have people agree to pay according those rates. This would defini…

Bechtel had a neat scheme where they bought all of the water rights for 40 years in Bolivia for $2.5B -- with a contract that guaranteed them a minimum of 15% return each year.

Citizens revolted when it was learned they may need to obtain a license from the government to collect rainwater from their roofs.

https://en.wikipedia.org/wiki/Cochabamba_Water_War

Re: SCOTUS: Patent Rights Over a Printer Cartridge Are Exhausted When It Is Sold

#176

Post by touchofevil » Tue, May 30, 2017, 7:49 PM UTC

nhsoe9aoeu wrote: post #163

touchofevil wrote: post #154

Earlier quoted context omitted.

It's not a question of whether FCPX is a good value. If an EU citizen pays a one-time fee for a lifetime license of FCPX they are supposed to be able to resell that software according to the Oracle vs UsedSoft ruling. Apple has not built a mechanism into their App Store to allow users to transfer licenses to one another, which means they are not complying with the EU ruling. This applies to every software product in…

It doesn't appear to me that EU citizens are paying a one-time fee for a lifetime license. It appears to me (though I'm no lawyer) that they are paying a one-time fee for a subscription . I don't know whether it's time-limited or lifetime, but it is a distinction with an actual difference, and may affect how EU law regards it.

The whole "lifetime license in exchange for a one-time fee" idea in the Oracle vs UsedSoft case comes from that case trying to determine what "ownership" means in regards to digital products. In Autodesk vs Vernor, Autodesk was claiming that if you paid $3,000 for license of Autocad, you don't actually own that software you are just "licensing" it and thus the first sale doctrine doesn't apply, so the customer can't resell the Autocad product they bought, even though the customer paid a one-time fee for a product they "own" for life (this was before Autodesk moved to a subscription model). Autodesk claimed this b/c they included in their EULA that the customer was merely licensing their product and didn't "own" it. The US supreme court eventually agreed with Autodesk.

In the Oracle vs UsedSoft case, the EU court was taking on this question of what does it mean to "own" a digital product vs "licensing" a digital product. That court came to the conclusion that if you paid a one-time fee for a lifetime license of a digital product then you own that product (no matter what the EULA says) and the first sale doctrine applies, which gives you the right to resell it. On the other hand, if you were paying a fee that only gives you access for a set amount of time (a subscription), then you would just be renting (or "licensing") that product for a certain amount of time and thus wouldn't own it, which means you can't resell that product because it isn't covered by the first sale doctrine.

A subscription expires and would need to be renewed. Your license for FCPX never expires. Since you paid a one-time fee for a license of FCPX that never expires (a lifetime license) your copy of FCPX would be covered Oracle vs UsedSoft in the EU and you could resell it. Paying a one-time fee for something is not a subscription.

If you buy a car with cash, you own that car. You can own/use that car for the rest of your life or you can resell that car. If you lease a car you have a subscription that you must renew to keep using that car and you do not have the right to resell that car. That is basically how the Oracle vs UsedSoft sees software products in the EU.

Re: SCOTUS: Patent Rights Over a Printer Cartridge Are Exhausted When It Is Sold

#177

Post by mark-r » Tue, May 30, 2017, 7:49 PM UTC

woofyman wrote: post #148

exelius wrote: post #111

Earlier quoted context omitted.

I think that this distinction is largely becoming irrelevant in the cloud era. Most software is sold / licensed on a term basis these days, and honestly the industry is healthier as a result. App stores are really the only remaining vestige of "buy once, use forever" -- and I'd guess that the EU isn't interested in going after it thanks to the small dollar amount and huge number of companies who benefit. Software was…

As a consumer, I will never purchase subscription software. If a new version has a feature I need or because of OS upgrade, I'll purchase the new version or an upgrade if offered.

The physical goods model for software is much more consumer friendly. You don't need every single upgrade, you can choose how much to spend on an ongoing basis. If an "upgrade" is less suitable for you than the original, you can skip it or look for a substitute.

It's scary to contemplate a world where the software you rely on every day can change out from under you without your control or even knowledge. See the animosity aimed at Windows 10 updates.

Re: SCOTUS: Patent Rights Over a Printer Cartridge Are Exhausted When It Is Sold

#178

Post by ada1981 » Tue, May 30, 2017, 7:52 PM UTC

mbreese wrote: post #97

gameshot911 wrote: post #65

Can someone clarify one part: >The other option is to buy a cartridge at a discount through Lexmark’s “Return Program.” In exchange for the lower price, customers who buy through the Return Program must sign a contract agreeing to use the cartridge only once and to refrain from transferring the cartridge to anyone but Lexmark. >As a result, even if the restrictions in Lexmark’s contracts with its customers were clear…

Yes, assuming the contract was valid. Lexmark could in that case sue their customers that sent cartridges to a re-manufacturer. The only one with a relationship with Lexmark is their customer, so that's the only entity they could sue. (However, given that this isn't a case involving Lexmark and a customer, the court didn't rule on that contract, just acknowledges the possibility.) "If the patentee negotiates a contra…

Instead of selling it, why not just lease it? They would then retain ownership and could very well claim theft if another company attempted to refill it and sell it.

Shouldn't they be able to structure their lease agreement as a 1 time payment and 100 year term or something?

If I lease a car, someone else can't repaint it and sell it legally.

Re: SCOTUS: Patent Rights Over a Printer Cartridge Are Exhausted When It Is Sold

#179

Post by tom_mellior » Tue, May 30, 2017, 7:53 PM UTC

fulafel wrote: post #110

touchofevil wrote: post #48

If you want to learn about a really interesting aspect of the "first sale doctrine" and how it applies to software, you should have a look at "Vernor vs Autodesk" in the USA and compare it to "Oracle vs UsedSoft" in the EU. Basically, in the USA the courts determined that if a company sells you software, but in their terms & conditions claim that they are merely granting you a license, then you can't resell the softw…

It does not work like this in the EU. Most EU countries don't have a case law based ("common law") system, for starters.

It's true that the EU is not ruled by common law. It does not follow that rulings by the Court of Justice have no effect. The ECJ interprets the laws as written, and in this particular case it decided that software can be resold. That is the status quo in the EU until (a) EU institutions change the law, or (b) the ECJ decides to revisit this and comes to a different decision.

Here's the ruling: http://curia.europa.eu/juris/document/document.jsf?docid=124...

Re: SCOTUS: Patent Rights Over a Printer Cartridge Are Exhausted When It Is Sold

#180

Post by ada1981 » Tue, May 30, 2017, 7:55 PM UTC

tbirrell wrote: post #87

gameshot911 wrote: post #65

Can someone clarify one part: >The other option is to buy a cartridge at a discount through Lexmark’s “Return Program.” In exchange for the lower price, customers who buy through the Return Program must sign a contract agreeing to use the cartridge only once and to refrain from transferring the cartridge to anyone but Lexmark. >As a result, even if the restrictions in Lexmark’s contracts with its customers were clear…

No. That's what SCOTUS is saying. Lexmark is trying to enforce a contract over an item that they do not control. Is like if you signed a contract with me that every time you handed someone a glass of water, you would require them to say "thank you" in a non-native language. I have no control (legal or otherwise) over your actions or the glass or the water, therefore the contract is not enforceable. In the case, Lexma…

If I sign that contract with you and don't deliver on my promise of having people tell me "thank-you" in a non-native language every time I give them a glass of water, I'd be in breach of contract with you.

I'm not opposed to the deal, I just better get really incredible terms.