Legally Flawed but Politically Sound? Digital Exhaustion of Copyright in Europe after UsedSoft

Abstract

The principle of exhaustion, or the first sale doctrine (US), in copyright means that once a copy of a work is put on the market with the consent of the right holder he or she will not be entitled to control the further distribution of the copy. It is well settled that the exhaustion rule applies to the distribution of tangible copies (books, CDs, DVDs etc), but its application to the online context is controversial. In the UsedSoft case (case C-128/11) the Court of Justice of the European Union nevertheless applied the exhaustion rule of the Computer Software Directive to a situation where ‘used licenses’ of computer software were passed on to third parties enabling them to download the software from the right holder’s website. The article discusses the legal premises and the policy implications of the decision, contrasting it also to the ReDigi decision of the US District Court of the Southern District of New York.