Adobe is being sued in a California court for allegedly filing bogus DMCA notices with eBay in order to prevent a company from reselling its software. When the company responded by filing counternotices, Adobe allegedly circumvented the eBay DMCA complaints system by reporting the seller for selling pirated products, resulting in the termination of the account.
Anyone wanting to purchase computer software in 2020 can generally do so via the Internet. Most companies offer digital downloads and the process is relatively simple.
However, there are third-party sellers on platforms like eBay and Amazon who sell genuine products to the public but are not necessarily recognized as ‘authorized’ vendors by software companies. This can cause friction, as shown in a lawsuit filed in a California court this week.
Plaintiff Green Savannah LLC describes itself as a Washington-based reseller of, among other things, genuine copies of Adobe software. According to its complaint, the company grew to become “the largest and highest rated seller” of Adobe software on eBay but this attracted the wrong kind of attention from the software giant.
Adobe Tried to Use the DMCA to Shut Down Sales, But Failed
The problem appears to have started when Adobe submitted “numerous bogus infringement notices to eBay under the Digital Millennium Copyright Act, 17 U.S.C. §512”, i.e DMCA notices complaining that the plaintiff’s software sales infringed Adobe’s copyrights. Green Savannah responded by filing counternotices with eBay, an action that resulted in the deleted listings being restored.
Adobe could’ve sued to prevent the listings being reinstated but the lawsuit claims it failed to do so.
“Under the DMCA, if Defendant disputed Plaintiff’s counter notices, Defendant had the opportunity to file a lawsuit against Plaintiff within ten to fourteen days. However, while Defendant threatened to do so, it did not file any lawsuit,” the complaint notes.
Adobe did take other action, however. The lawsuit claims that beginning in 2019, Adobe “sidestepped” eBay’s DMCA procedures in what is described as a move to prevent Green Savannah from filing counternotices and having its software sales reinstated.
Instead, it’s alleged that Adobe reported the company to eBay for selling “counterfeit” products and/or pirated Adobe software and in March 2020, the auction site terminated the company’s account.
Software Piracy Claims Shut Down Seller’s Account
“As a direct and proximate result of Defendant’s misconduct, Plaintiff’s ability to sell any software (or anything else) on eBay was terminated, even though Plaintiff had a five-star rating on eBay and no other complaints,” the lawsuit reads.
“Defendant intentionally communicated the False Statements to eBay in an effort to have eBay suspend or revoke Plaintiff’s account and/or remove Plaintiff’s eBay listings. Defendant’s abusive history speaks for itself; Defendant has unsuccessfully targeted multiple resellers for similar issues in an effort to stifle competition and consumer choice.”
Green Savannah says it tried to have its eBay account reinstated and attempted to communicate with Adobe. With no success on either front, the company filed its lawsuit to protect what it describes as its legal right to resell software under US Copyright Law.
First Sale Doctrine
“Under the well-established ‘first sale doctrine,’ the right of a producer or developer to control distribution of a product protected by copyright and/or trademark rights does not extend beyond the first sale of a product,” the complaint reads.
“In other words, where a person lawfully acquires ownership of a genuine copy of copyrighted software, it may resell that product/software without committing copyright or other infringement.”
According to the company it has been taking advantage of this legal concept on eBay for around six years and has only ever offered and sold genuine Adobe software acquired from third-parties. Importantly, those third-parties are alleged to have owned (as opposed to licensed) that software.
Abusing the DMCA to Gain a Commercial Advantage
Green Savannah claims that over the past three years, Adobe sent numerous “bogus” DMCA notices to eBay under 17 U.S.C. §512 to remove and takedown the seller’s eBay listings for Adobe software. These actions were deliberate, the complaint alleges, and Adobe knew they would cause damage to the seller.
“Defendant knew or should have known that Plaintiff’s listings and sales of Adobe software on eBay were covered by the first sale doctrine, and that Plaintiff was not infringing on Defendant’s copyrights,” the first cause of action reads.
The remaining actions center on contractual interference, interference with intent to gain economic advantage, and unfair competition, mostly interwoven with the core issue of the reportedly malicious DMCA notices.
Prayer For Relief
Among other things, Green Savannah LLC is demanding a permanent injunction against Adobe restraining it from the alleged unfair business practices detailed above. It also demands damages to compensate for the “bogus” DMCA notices Adobe sent to eBay.
The complaint, filed by Green Savannah LLC against Adobe Inc., is available here (pdf)
Many thanks to TorrentFreak for the breaking news.