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Should I AR This?


Roger Raabe
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Today, I was browsing animation stores.  In one, that sells animations with copy, mod, or full perms, there were license terms posted.  They said, "If you sell the animations in a POSEBALL, either copy OR trans (never copy and trans) you agree to sell them at the same price (or higher) as ... does."

License terms restricting resale prices violate US antitrust law, as explained on the Department of Justice Web site at http://www.justice.gov/atr/public/guidelines/0558.htm#t52.

What do you think?

 

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It probably should be ARable for that reason.

But its super common.

And this is one of the greatest flaws of LLs: They operate a commercial market, but do so in ways that result in very frequent legally questionable legal...

You can be sure a place like eBay has whole teams of people in a legal department to avoid issues like this.

But LLs is just code geeks...

 

They've been lucky so far to only be sued a handful of times... because we're all at risk for the lack of dilligence in ensuring complience.

 

AR, and include that link, hopefully they will consult their legal dept and make a proper choice. But I suspect it will just get a Lol and be ignored... but that's no reason to not bring it to their attention...

 

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Considering that LL operates worldwide, they're basically violating law all the time, just in different places. I don't know how it is in the US, but in some countries any such restrictions posted or even written in contract are automatically null and void precisely because contracts and end user licenses cannot override law.

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Roger Raabe wrote:

Today, I was browsing animation stores.  In one, that sells animations with copy, mod, or full perms, there were license terms posted.  They said, "If you sell the animations in a POSEBALL, either copy OR trans (never copy and trans) you agree to sell them at the same price (or higher) as ... does."

License terms restricting resale prices violate US antitrust law, as explained on the Department of Justice Web site at 

What do you think?

 

The court decision cited involved products that could only be used for resale in a certain way. Since there are many ways of using the animations and only the use of them in poseballs is regulated as far as price I don't think the decision applies.

http://en.wikipedia.org/wiki/United_States_v._Univis_Lens_Co.

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Now that I think of it, there was a thread about this issue on the Merchant forums awhile back posted by a merchant complaining that people were breaking part of their resell license agreement.  The last post on the first page and the second page are pertinent to your question:

http://community.secondlife.com/t5/Merchants/Is-there-anything-I-can-do/td-p/1717601/highlight/true

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Ciaran Laval wrote:

Do laws such as that extend inside Second Life? I could see a case for the marketplace whereby items can be purchased via US Dollars.

SL is a US business, not a sovereign nation.

 

As for 'all over the world' - I see that a lot among people on the internet. This idea that there is no such thing as international law...

But consider how does so much global business get done? How do treaties stay intact? How is travel able to happen?

International law is a huge body of law, and it is not arbitrary or 'anything you can get away with' - it is pretty well established, and very stable. It has a history longer than many of the nations that are held to it.

Quite a large number of legal professinal make whole careers solely in this field. And many global businesses emply teams with specialists in the area.

Granted many foolishly trod ahead without ever consulting anyone expert in international or comparative law or even legal theory... but those folsk also tend to end up in court highly unprepaired.

Given that SL is a US business, any business done within SL will be at a minimum subject to US law. It may then be subject to an assortment of other laws as well, facts depending.

 

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Pussycat Catnap wrote:

SL is a US business, not a sovereign nation.

 

SL is a virtual world and as such the way it's structured means that some laws that would be applicable if you were selling content outside a virtual world, do not apply. For example, inworld transactions are outside the scope of VAT. People don't report their Linden Dollars holdings to the tax authorities for the purposes of income tax (it's different if you sell them for US Dollars), yadda yadda yadda, so there are differences in the reach of the law inside virtual worlds at this moment in time.

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Ciaran Laval wrote:

Do laws such as that extend inside Second Life? I could see a case for the marketplace whereby items can be purchased via US Dollars.

that the correct intepretation i think

is not a sale in RL terms if the trade is done in L$. if it was then trades in L$ would also be liable for RL income and sales taxes as well. so far the tax and commerce commissions have ruled that they are not sales in a RL sense. if they not then i dont think that can then argue they covered by other commerce/sales laws

it might be possible to argue this in a Court. however i dont think you will win on it. the judge will say is for the legal appointed commissions to make this determination not the court. i think the only argument that the Court would entertain is do the commissions have the lawful right to make the rulings they do

is their ruling legal

 

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It really isn't up to LL to assure that people follow RL laws like this  They are not legal experts nor do they have any legal authority in enforcing laws.  If they would have some liability by not acting, I am sure they would.

I doubt they would do anything if you filed an AR other than to tell you to sue the creator in RL court and since we are talking L's not RL money it would probably be thrown out.

However if the court did rule that this violated anti trust rules, the creator could easily and legally change their user license to forbidding the sale of the animations in a pose ball at all and require that they only be sold as part of a larger build.

The bigger question in my mind is why would you want to undercut the creator to begin with?  That could result in them not making any of there work available full perm or stop making it available at all and you would lose a resource.  Seems to me you are cutting off your nose to spite your face.

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People, people, people... you put too much thought into this! The simple answer is that the law only applies to those who follow it! :matte-motes-big-grin:

I am kidding about that generally speaking but in reality there isn't much "law" in Second Life. You can do just about anything until a Linden tells you not too but otherwise very very few lawyers in very very few countries would ever take a Second Life case let alone go to court. Among all the jurisdiction questions, need to discover & disclose an avatar's true owner, and the debate of virtual items as "real" property is the ever-present condition established by Second Life's TOS that the linden has absolutely no monetary value. Basically it all ads up to one big fact; you can't steal something that does not exist or have value according to real-world law.

FYI, this was not the original case in Second Life. When it first began, Linden Lab's TOS attempted to protect creator rights and legitimize the linden as valuable. Court cases such as those brought by SexGen and responses to threats made by politicians over matters like in-world gambling caused Linden Lab to re-write its TOS which literally canceled out any type of legitimacy to in-world products, business, or the linden. For those old enough to remember, the first major exodus happened shortly after the re-write when all the real-life businesses shut down their sims for the reasons mentioned above.

Hope this helps. I feel old knowing all this... someone should send me some lingerie or a sexy dress so I can feel young and perky again! Just kidding... kinda! :matte-motes-bashful-cute-2:

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Amethyst Jetaime wrote:

The bigger question in my mind is why would you want to undercut the creator to begin with?  That could result in them not making any of there work available full perm or stop making it available at all and you would lose a resource.  Seems to me you are cutting off your nose to spite your face.

I wanted to answer this part here, because I know what you're getting at and can actually answer it, lol.

A lot of people who sell things, such as animations, sell them at reasonable prices but not necessarily low cost. They sell them primarily for other creators to use in builds. Which is usually why they cost what they do, for full perms(or even copy/trans). I've bought numerous scripts, animations, textures, etc... over the years. So I'll give an example.

Let's say I buy a specific animation for, $800L. Now that might seem a little high(again, I'm just using an example), but my intent is to put this animation in a product I've created. I know that over time, I'm going to recoup what I've paid out-making the cost worth it. But I don't want to do so on the first initial purchase. In other words I don't want to charge $800L for my item(even if it may be worth that). I could have any number of reasons for my decision(I don't judge people's pricing, or try not to anyway). So I decide I'm going to charge $100L for this item I've created. Over time I make back my $800L, and then some. Awesome. Now I know if I need such products again, I've likely found a good place to get them. I'm probably going to be a repeat customer of this merchant. Hence, keeping us both in business(or at least helping).

If the merchant I bought that $800L animation from had such a license agreement, I wouldn't be purchasing it from him/her. In fact, I wouldn't purchase anything from him/her. Not that one lost customer is any big deal, I'm quite sure. But it's just my own choice. I don't like to support people that try to limit my pricing, it's just not my bag. I don't support it in rl either. So I go find someone else who has it. If I can't find someone else, I can make it myself, have someone else make it, or scrap it and move on to something else. All three are better solutions, for me, than supporting the merchant's decision to try and limit my pricing. Now they've lost business. I may not be alone in my decision, either. In fact, it's highly likely, I'm not.

I don't consider selling my product for $100L as cutting off my own nose. I don't consider it undercutting either. I don't consider it harmful to the animation creator at all. Nor do I consider it harmful when people use things I've created and sell them at a lower cost than I sold it to them. That merchant made their money off me. In the case of my customers, I've made my money off them. If the product is any good, they'll likely make more money off me, or I off my customers. That should be the end of their involvement in my sales/creations(barring any other user agreement I may have with them by purchasing/using their stuff of course). I consider my sales to people as my final involvement in their creations. I don't believe I should get a say in what they charge. The people I buy from should not be able to dictate what I can sell things for, either. That's my own personal point of view of course and does not reflect any other's.

 

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Theresa Tennyson wrote:

It sounds to me like the merchant who supplies the full-perm animations also sells them retail as poseballs. The wholesaler is trying to keep their OWN nose from being cut off. Which makes a certain amount of sense.

can also make sense that the wholesaler wants to have their cake and eat it to (:

+

is why i think that in RL is a separation been worked out over 1000s of years of market trading. learned the hard way mostly

as a wholesaler competing with your own retailers dont work out all that well

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In this case, if I understand it correctly, the creator is saying that if you sell the animations in a pose ball only and not part of a larger build, you are required to sell it for the same price they do.  I've seen this before in a number of licenses.  If you are allowed to sell the item individually and not part of a larger build you are required to sell it for the same price or at least not lower than a price they specify.

Most of the full perm animations I buy restrict their use to selling them only as part of a larger build.  You aren't allowed to sell them individually in a pose ball.  So the license in question is far more liberal than most.  That is why I asked why they wanted to undercut the creator and the possible additional restrictions the creator could impose if they did.  Doing something that would cause the creator to use a more restrictive license is IMO cutting off your nose to spite your face.

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Well, I'd suggest reading that DOJ / FTC guide more closely, keeping in mind that trade in SL virtual "goods" is really sublicensing of IP; there is no actual commodity traded in SL, so the rules about "per se" price-fixing aren't going to automatically apply. Instead it's going to be a "rule of reason" interpretation of whether sublicensing terms are anti-competitive... and given that there are few if any SL animators that can claim a 20% market share, there's no anti-trust case at all.

(Caveat: IANAL, etc.)

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Roger Raabe wrote:

Today, I was browsing animation stores.  In one, that sells animations with copy, mod, or full perms, there were license terms posted.  They said, "If you sell the animations in a POSEBALL, either copy OR trans (never copy and trans) you agree to sell them at the same price (or higher) as ... does."

License terms restricting resale prices violate US antitrust law, as explained on the Department of Justice Web site at 

What do you think?

 

I can't speak to the legal aspect of it. But I see it a lot on marketplace. Many people who sell full perm sculpt kits for builders will now add stipulations like: Cannot give away the finished product as a freebie (not with any permissions.) Cannot sell for less than 50 $L. Cannot sell on marketplace for less than 50 $L. 

If asked, most will say that's because they don't want you to undercut the sales of someone else who made the same thing with the same kit but is selling it for 250 $L or 350 $L.

I find that level of control off putting and I do not buy those kits.

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Price fixing is an agreement between participants on the same side in a market to buy or sell a product, service, or commodity only at a fixed price, or maintain the market conditions such that the price is maintained at a given level by controlling supply and demand.

 

one would think that  flooding the market with land to fix prices and corner markets is just as illegal

But alas. We are saved by the TOS. Linden Dollars are not real money or have 0 value! laffs

 

Maybe they should look into being legal experts lol

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