Intellectual Property Law

Chapter 15 Case Study Answers

Case Study: Fit Forever has one copy of an accounting software program that it is using
to estimate its expenses in its California offices. It downloaded the program from Finance
Inc.’s website after selecting an “I agree” button.

Activities: May Fit Forever sell a copy of this program to another? May it make extra
copies of the program for its Oregon offices? Discuss.

It is highly unlikely that Fit Forever will be able to sell a copy of this
program to another. Software purchased both over the counter and over the
Internet is seldom, if ever, “sold.” It is merely licensed to the user per the
terms and conditions of a license agreement. Because the transaction is a
license rather than a sale, there was no “first sale” to Fit Forever such that it
could thereafter sell the program to another. Fit Forever manifested assent to
these license terms when it selected the “I agree” button, thereby creating a
click-wrap license.

Assuming that the license with Finance Inc. does not permit the making of
extra copies (which is highly unlikely because Finance Inc. would prefer to
sell additional copies rather than having its customers share them), by
making extra (and unlicensed) copies of the program, Fit Forever is engaging
in “softlifting,” the illegal practice of making unauthorized copies of a
licensed computer program.