In a perhaps not too surprising result, the case in Germany brought against Valve that attempted to demonstrate the right to resell Steam games was lost last week. Brought by German consumer group Verbraucherzentrale Bundesverband (vzbv), this was a second attempt to see a court rule that consumers have the right to resell their Steam games. Like you can with any physical gaming product. And for a second time, the courts ruled against it.
It’s peculiar. As Muktware reports, this second attempt happened after the 2012 ruling of the Court of Justice of the European Union (CJEU) ruled that people should have the right to resell downloaded products, and that it wasn’t okay for a publisher to stop them with a EULA. Bearing this in mind, the consumer group assumed it would make sense to follow this by ruling that gamers had a right to resell products bought from Valve’s Steam. But no.
It all comes down to the “doctrine of exhaustion”. As Osborne Clark’s comprehensive coverage of the ruling explains, exhaustion is the principle where a copyright owner’s right to control individual copies of their material is limited after a sale – their right to control distribution is exhausted by that initial sale. Although despite this being law in the EU and US, there doesn’t seem to be any notion of this being applied to digital content.
Right now, if you buy a game from Steam, it’s locked into your Steam account. You can’t give it to someone else when you’re finished with it, nor sell it on as a second-hand game. What vzbv were attempting to argue their first time out was that Valve were in violation of the laws on exhaustion by preventing Steam users from being able to sell on or transfer their online account.
It’s of note that Valve could have, at this point, said: “Oh yeah, fair enough, we could do better at this.” With their desires to be offering the best for consumers and consumers’ interests, this would have been another opportunity for Valve to embrace that philosophy, and provide their customers with the barest of rights of ownership.
Valve fought it and won, and in 2010 the suit was dismissed. The ruling, according to Osborne Clark, said,
“While the doctrine of exhaustion limited the rights holders’ powers with regards to an individual DVD, it did not require them to design their business in a way that facilitated the sale of used games and therefore did not make the Steam terms of service unenforceable.”
Come that 2012 ruling from the EU courts that the doctrine of exhaustion does apply to digital content, you can see why vzbv saw cause to return to the matter. They’d lost because a judge ruled it didn’t apply to digital products, but now there was a bigger, louder ruling that digital content consumers should be protected in the same way. Despite the intangibility of an online purchase, it seemed that a court was finally recognising that the last of a plastic carrier shouldn’t change a consumer’s rights.
However, it’s never that simple.
The CJEU ruling was based on a case between UsedSoft and Oracle, which stated that various flargleblargle provisions in the elaborately arcane rules (that were created when content was split physical and digital) meant that exhaustion did apply to “intangible copies”, and that therefore, the doctrine needed to be applied to modern-day e-shopping. However, and here is where a law student can find enough material to write their dissertation, it seems that this may only apply to “computer software”. And that video games may not actually count as “computer software” because of their “audiovisual components”. They’re “not only computer software” (emphasis mine). And it’s this distinction that excludes games from the CJEU UsedSoft ruling, and allowed the German courts to hand victory to Valve once again.
There’s a degree of rationale behind these decisions, that perhaps extends beyond aggressively protecting copyrights against consumer interests. Were it to be ruled that the digital content of a game can be sold on, it makes it a lot harder to enforce rules against piracy. While such a freedom given to consumers would technically mean that only one copy of the game could ever move on from person to person, it would certainly introduce some blurred lines when it came to file sharing, and so forth.
However, there’s something crucial to remember about all this: Valve could be extending the basic consumer rights of reselling or sharing individual purchased copies of a game to their customers. Steam itself provides a framework that makes this possible. The ability to buy a game and then either keep it in your account, or gift it to another, demonstrates that the infrastructure is already in place to allow the transfer of ownership of Steam games. And while courts may avoid making rulings that apply long-standard rights to online content, for fear of opening doors to piracy, Valve would have no such concern if it offered this within its own fences. It is perfectly possible for Valve to allow customers to buy a game, play it for as long as they wish, and then transfer that uniquely coded copy of that game to someone else, either for free, or for an agreed fee. Heck – doing it through their own software, they could even enforce a chunk of that money reach the developer or publisher at the time. Not that this would be in accordance with the doctrine of exhaustion either.
But, so far, they’re not.
Original version of top image by Jonund.