The European Court of Justice reportedly says today that the rule applies to copies of software both on physical media and downloaded from the Internet.
The European Union's Court of Justice has reportedly crushed Oracle's hope of stopping a company from reselling its used software.
The Luxembourg-based court today ruled in favor of German company UsedSoft, which sells used software licenses. The court said that once a software company sells "a copy of a computer program," its "exclusive right of distribution" is eliminated, paving the way for other companies to sell the used licenses, according to The Wall Street Journal, which obtained a copy of the ruling. The rule applies to both physical media and copies of the software downloaded over the Web, according to the court.
Oracle took issue with UsedSoft for selling to customers used software or license keys for programs. UsedSoft appears to focus much of its efforts on enterprise software and is currently selling everything from Office 2010 Professional Plus to SharePoint Portal Server.
The issue for Oracle is the implied contract that exists, according to the court, between the software company and licensee. The court said today, according to the Journal, that upon paying for a program, the licensee enters into an "agreement granting the customer the right to use that copy for an unlimited period."
For companies, used software sales are a major issue. Not only do other companies profit off of their creations, but they generate no revenue from the sale. Copyrightholders have long taken issue with companies that try to sell used software or media. Back in November, the Recording Industry Association of America (RIAA) sent a cease-and-desist letter to ReDigi for selling used digital music. EMI subsequently sued the company.
Although game companies haven't been so drastic in their responses to used game sales, the company have made it clear that they have no interest in helping retailers sell used titles.
Despite the obvious blow to its efforts, Oracle did get a consolation prize in today's ruling: the Court of Justice says that in order for a used license or software to be sold, original owners must erase all copies of the program from their own computers.
CNET has contacted Oracle for comment on the ruling. We will update this story when we have more information.