The European Union has issued a ruling (PDF) stating that German-based UsedSoft was legally entitled to resell their Oracle licenses, giving digital products the same rights in the EU that physical rights have.
According to the ruling, when someone sells a customer a right to use their license to a product that the seller initially bought, the license can indeed be transferred, explicitly allowing the practice regardless of anything the end user license agreement may allow.
One caveat is that the license must be transferred “for an unlimited period,” and that the seller must cease using or destroy his downloaded copy of the software for the transaction to be legal.
The ruling applies to all digitally purchased goods, so it also applies to software sold on services such as the PlayStation Network, Steam, and Origin, all of which explicitly state via their EULAs that the practice is against their rules. Valve has been known to ban users who are caught lending or selling their Steam account access.
The ruling only applies for the European Union and has no bearing on the United States, Canada, or any other countries or regions. Oracle has yet to react. As of press time, we have yet to receive word from Valve or Electronic Arts.
Analysis: To borrow a phrase by ESPN’s Lee Corso, “Not so fast, my friend.”
Remember when the American courts ruled that “jailbreaking” iPhones was legal? That only meant that people couldn’t be prosecuted for it. They didn’t say anything about Apple having to welcome it with open arms; in fact, they’re within their rights to make it that much harder from a technological standpoint, and indeed that’s what they’re doing as the cat-and-mouse game continues between jailbreakers and the company.
Such will also be the case regarding reselling accounts or games. No, it’s not illegal in the sense that Steam can ban your account or otherwise financially harm you. But I read nothing in this that indicates that Steam has to make it an actual option; i.e. give game to X. I don’t see it being added in the near future, either—same with Origin, Stardock, or any other digital service, and everyone knows Microsoft and Sony have their own tricks up their sleeves to keep the incentive away from people getting any kooky ideas. In fact, Steam could argue that a profile change could affect them elsewhere, with Americans saying they’re from Europe so they can trade games. Hell, I’m not above it; my new 3DS thinks I live in Beaverton, Oregon, Land of No Sales Tax.
Yes, this is a great step for gamers, whose rights have been more or less trampled by publishers using shrinkwrap EULAs to justify just about any kind of abuse one could think of, from “licensing” the games they buy to draconian DRM. But in practice, I don’t see this impacting EU gamers much outside of being able to sell entire accounts. Hell, I expect Oracle to technologically limit what UsedSoft is doing—and for American gamers, the Supreme Court would have to rule in a broader manner on the use of shrinkwrap licenses than they have in the past (as it is, it’s a jurisdictional issue). That would also have to uphold the first sale doctrine as recognised in past SCOTUS decisions for digital rights.
If one were to ask me how that would go with the current layout of the court, I would predict that they would uphold the first sale, but also uphold the rights of companies to issue their own terms in pre-purchase EULAs, rendering the latter point moot even before we get to companies actually supporting something they’ve gone on record as saying is “killing” the industry.