GM: That Car You Bought. We’re Really The Ones Who Own It

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COX K., GM: That Car You Bought? We’re Really The Ones Who Own It, consumerist.com, 20.05.2015

Type Article
Abstract
Link http://consumerist.com/2015/05/20/gm-that-car-you-bought-were-really-the-ones-who-own-it/?imm_mid=0d29cd&cmp=em-iot-na-na-newsltr_iot_20150527
Topics Intellectual Property, Property

Notes

General Motors states that the software in its vehicles are not sold, but only licensed. It's the same claim John Deere is making about its tractors.

GM's argumentations is more or less the following:

  • "Cars work because software tells all the parts how to operate
  • The software that tells all the parts to operate is customized code
  • That code is subject to copyright
  • GM owns the copyright on that code and that software
  • A modern car cannot run without that software; it is integral to all systems
  • Therefore, the purchase or use of that car is a licensing agreement
  • And since it is subject to a licensing agreement, GM is the owner and can allow/disallow certain uses or access"

The main problematic issue of the manufacturer pretending to retain the title on the car is the possibility of customers and independent mechanics to tinker with the car's software.

The debate is currently taking place in the USA. But what will be the outcome of the litigation in the European legal context?

It is probable that third-party tinkering would be part of the exception stated by article 5(1) of the DIRECTIVE 2009/24/EC on the legal protection of computer programs, at least if necessary for the correction of errors or for upgrades without which the car couldn't be used for its intended purpose. This exception in fact applies not only to the buyer, but also to "licensee, renter or a person authorised to use the program on behalf of one of the above" (Report from the Commission to the Council, the European Parliament and the Economic and Social Committee on the implementation and effects of Directive 91/250/EEC on the legal protection computer programs, p. 12).

In fact, art. 5(1) of the Software Directive states that the lawful acquirer of a copy of a software can without authorization make those actions which are necessary for error correction (and – no matter if he is a buyer or a licensee – clauses that oppose to it aren't valid: Recital 18). RICOLFI (I Contratti dell'Informatica, pp. 8-9) deals with the Italian norm (art. 64-ter.1 l.d.a.), which however reproduces the European provision: RICOLFI states that error correction (patches) is always possible, but the addition of new functionalities requires the authorization. In my opinion, for what concerns the intermediate category of updates, the possibility of making it without authorization depends on the fact that they are necessary to continue to use the copy of the software in accordance with its intended purpose. The provision about error correction seems to allow also the correction by a third party on behalf of the lawful acquirer (indeed, Report from the Commission to the Council, the European Parliament and the Economic and Social Committee on the implementation and effects of Directive 91/250/EEC on the legal protection computer programs deals with the fact that “lawful acquirer” of art. 5(1)may also be a person acting for the purchaser or hirer).

However, the ownership problem still remains: the contract which accompanies the commercialization of the software embedded in the car is a real licence or rather it's a sale? If we follow the Oracle v. UsedSoft case, the answer depends on the type of payment and on the product usability duration established in the contract.