Ownership and Copyright Law: Legal Fences Between You and Your Purchases

Written by Stan Adams

2016-01-21-buy-now_fence-blog

Do you own the software embedded in your mobile phone, car, or robot bartender? According to the software’s copyright holder, probably not. Chances are that software is subject to a licensing agreement that restricts what you may do with it. The same is true for the e-books, movies, and music you buy online. Even though clicking the “Buy Now” button may have led you to think that you own a copy of the book, song, or movie, what you actually bought was permission to use the copy in the ways permitted under the pages-long end user licensing agreement.

In addition to the issues raised by the semantic differences between buying and licensing, an important legal distinction lies between these two modes of possession: generally, the rights and freedoms associated with ownership are far greater than those of licensing. Copyright law gives authors the exclusive right to control the reproduction and distribution of original works, subject to certain limitations and exceptions. But when a copyright holder sells a copy of a protected work, the copyright holder’s right to control the distribution of that particular copy ends. This principle, known as exhaustion, is the basis for the first sale doctrine, which allows you to loan, sell, rent, or give away your old books, art, and music. First sale, however, does not apply to copies distributed under a license.

Even though clicking the “Buy Now” button may have led you to think that you own a copy of the book… what you actually bought was permission to use the copy in the ways permitted under the pages-long end user licensing agreement.

As more and more copyrighted content moves to digital format, the transfer of copies has moved dramatically toward licensing. While the convenience and portability of non-physical copies is undeniable from the consumer perspective, the longer-term consequences of a world without individual ownership are more subtle. Selling your old books, buying secondhand music, leaving your media collection in your will, or loaning an album to a friend can violate the licensing agreements to which those copies are subject. But the legal ramifications of ownership versus licensing go beyond the ability to (legally) transfer copies. For instance, Section 117 of the Copyright Act allows owners, but not licensees, to make backup copies of or modifications to copies of computer software that they own. This provision, and two major court opinions  assessing whether someone is an owner or a licensee of software,Vernor v. Autodesk, Inc. and Krause v. Titleserv, Inc., were central in the debate between proponents and opponents for several of the exemptions proposed in the Copyright Office’s 2015 Triennial Review process under the Digital Millennium Copyright Act (DMCA).

Section 1201 of the DMCA prohibits circumventing technological protection measures (TPMs) that control access to a work protected by copyright. These TPMs act as digital locks securing the copyrighted software embedded in everything from mobile phones and pacemakers to cars and tractors. While these locks may prevent some unauthorized copying (which is already illegal), they also prevent device and auto owners from accessing their copy of the software for legitimate reasons, like diagnosing and repairing problems, retrieving personal data, or modifying the software to suit their needs.

Last year, the Copyright Office and Library of Congress conducted its sixth triennial rulemaking proceeding to consider specific requests for three-year exemptions from 1201’s anti-circumvention provisions. The number of proposed exemptions was larger than ever, and many of the proposed exemptions arose from the basic belief that individuals, as owners of devices, systems, and the software copies embedded within, should be able to access and use their purchases as they see fit. Whether that means unlocking your mobile device, your video games no longer supported by hardware, or the diagnostics system in your car, the DMCA stands in the way. Fortunately, the Office granted several of the exemptions, which gave consumers the ability to diagnose, repair, and tinker with their cars, unlock and jailbreak their mobile devices and smart TVs (but not e-readers), preserve and continue playing video games no longer supported by the game makers, use alternative feedstock in 3D printers, and retrieve personal health information from their own medical devices.

Copyright law should not block or chill the independent research helping to find and fix vulnerabilities before they can be exploited.

The Office also granted an exemption for good-faith security research on software embedded in consumer devices, motorized land vehicles, and medical devices. Except for research on voting machines, this exemption will not take effect until late October, but it will provide some much needed certainty for researchers who would otherwise work in the shadow of DMCA liability. In a world of interconnected networks and devices, vulnerabilities, such as Heartbleed, can have drastic and far-reaching effects. As these devices become increasingly integrated into our lives and even our physical selves, we need to be able to trust, but also test and verify, their security. Copyright law should not block or chill the independent research helping to find and fix vulnerabilities before they can be exploited.  

Although a few proposed exemptions were not granted, this round of triennial exemptions was a win for consumers and the freedoms of ownership.  Nonetheless, the tension between the rights of copyright holders and the rights of software-embedded device owners remains. Copyright policy should ease that tension, adapting to new recording and distribution technologies to balance the interests at stake while preserving the incentive to offer true ownership of non-physical copies like software and media files.  The Unlocking Consumer Choice and Wireless Competition Act of 2014 broadened the exemption for cellphone unlocking adopted in the 2012 triennial rulemaking and clarified that the device owner could undertake circumvention, effectively cutting through whatever licensing agreements may have applied to the phone’s software. Other legislative proposals (here and here) similarly indicate a recognition that, in some contexts, the benefits of ownership outweigh the benefits of licensing. CDT believes that with innovative technological solutions and careful policy making, we can have the best of both worlds.  

The Copyright Office has asked for public comments on how copyright affects the world of software enabled consumer devices. Please take the opportunity to share your views before February 16.

Share Post