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Law Educator, Esq.
Law Educator, Esq., Attorney
Category: Business Law
Satisfied Customers: 118255
Experience:  All corporate law, including non-profits and charitable fraternal organizations.
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I run a business in Canada. I am considering reselling software

Resolved Question:

I run a business in Canada. I am considering reselling software on eBay for a profit, but am unsure as to the exact origin of this software. I was told it was legitimate genuine software, but the prices I can get it for make me wonder. The source is in China. I am wondering what could happen if it turns out that this software is not legitimate but copied software and I have been selling it on eBay. Ignorance is no excuse when it comes to the law, so what does the law state about this sort of thing? Who is "at fault" if it turns out that it is not legitimate and what are the possible repurcussions?
Submitted: 7 years ago.
Category: Business Law
Expert:  Law Educator, Esq. replied 7 years ago.
What can happen is that there are companies who specifically search for those selling software like you mention and they will sue you for copyright and trademark infringement and if it is found that you have an illegal copy of the software it could cost you thousands if not hundreds of thousands of dollars in damages for selling this and you would be at fault.

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Customer: replied 7 years ago.
Thanks for the quick answer. I hear you loud and clear, but the licenses are apparently genuine and they validate and update online just fine. They have been tested before, so they seem to be legit licenses. Can you point me to any cases where this has happened before to eBay sellers? I'm hoping my situation is different than theirs.
Expert:  Law Educator, Esq. replied 7 years ago.
It happens so frequently that we get at least 3 customers here a week who have received letters from these companies demanding damages and any remaining copies of the software. As far as the licenses being genuine you still need to be cautious because they many times are knock off licenses and the software also may not be for resale in Canada or the US. Again, you are taking a risky chance here that the software is bootleg or pirated software.
Customer: replied 7 years ago.
Wow, 3 customers a week? Are these end users you see, or sellers? Do the software companies send a cease and desist letter, or go straight to the lawsuit? Meaning, is there any warning?

If you have dealt with sellers of these software products, have they had to pay damages or did they just cease the illegal selling?

Thank you very much for your advice, it is very enlightening!
Expert:  Law Educator, Esq. replied 7 years ago.
Sellers. The software companies employ law firms that search eBay and similar sites for potential violations, they may even buy a copy and test it to see if it is legitimate and then they send the letter. Additionally, when you read these licenses they specifically prohibit the common law right of resale, which means that even if you are selling the legitimate copy they hit you with a violation because your license says you cannot resell the license and you must be an authorized software dealer. In some cases the law firm will settle for you sending them proof of how many you sold and any profit you made from the sale and the remaining copies you have and in other cases these firms will file suit and it can get very costly depending on how many copies you have sold and have remaining for sale.
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