The Turkish Supreme Court recently held that irrespective of how they are released to the market, second-hand software sales do not constitute copyright infringement under the Intellectual and Artistic Works Law numbered 5846 (“Law”), provided the software was legitimately obtained by the first user.
In the dispute at hand, Party X produces software, licensing this to other parties (OEM License). Party Y purchases a software CD from one of Party X’s licensees. While granting licenses, Party X provides authenticity stickers which bear the licensee’s name. Party Y attaches the sticker to the computer tower which the software is used on. At a later time, Party Y resells the software (including user guides). In other words, Party Y becomes a second-hand salesman and acts similar to a license grantor for Party X’s software.
In these circumstances, Party X alleged piracy and that Party Y had obtained the software illegally. Party X filed a criminal complaint based on this allegation. During investigations, software and computers were seized from Party Y. Party Y initiated a civil action against Party X (the case at hand), claiming material and immaterial damages for the seizures. Party Y also claimed that second-hand sale of computer software, which was legally obtained by the primary user, does not infringe Party X’s rights arising from laws or agreements.
Party X claimed the license agreement prohibits second-hand sale of the software. It also claimed that under the agreement, transferring the software to third parties would only be legal if the software is directly transferred as a whole with the device the software was sold for.
The First Instance Court held that the license provision which prohibits separate transfer of the original software apart from the computer is not aimed at copyright protection. Rather, the court held that this provision is only intended to regulate the software’s commercialization and control the second-hand market.
The First Instance Court ruled that Party X is technically capable of checking which computers the software is loaded on and which computer the software was first uploaded onto. The Court noted that Party X could not prove the software is also used by other users on different devices. On this basis, the Court held that second-hand sale of the software does not infringe Party X’s copyrights.
Party X appealed the First Instance Court’s decision to the Supreme Court. However, the Supreme Court approved the lower court’s decision. The Supreme Court referred specifically to Article 23(2) of the Law, which states: “resale of certain copies after their first sales or dissemination is made within the borders of the country by the transfer of their property by the owner of the right upon the utilization of the right to disseminate does not violate the dissemination right granted to the owner of the work, provided that the rights to lease and lend to the public are reserved.”
The Supreme Court stated that the article is a mandatory rule. It held that where such regulation exists, even if a license agreement provision prohibits second-hand sale of computer programs, this will not be considered to be copyright infringement.