An ATM operator sold the ATM machines in its possession to a purchaser with a unique software installed on the machines. The company that developed the unique software contended that the rights in the software were licensed and that the ATM operator was not allowed to transfer the license to the purchaser.
The Court held that there was no obstacle to transfer the license to the purchaser. When a copyright license is granted, the parties are required to explicitly indicate whether the license is transferable, because as long as the transfer of the license is not expressly prohibited, it may be assigned, unless it appears from the circumstances that the parties intended to prevent such a possibility. Accordingly, under to the first sale doctrine, there is a limitation on the ability of an intellectual property owner to control the actions taken by others in the product to which the intellectual property rights are attached after the owner of the rights has sold them for the first time. Here, the agreements between the parties did not expressly limit the ability of the licensee to transfer it to another and there is nothing in the parties' intention or in the type of relationship between them that indicates their intention to limit the transfer of the license. Also, the agreements make a distinction between the source code of the software and the installed copies of the software in a way that allows a distinction to be made between the intangible creative rights, upon which the copyright holder can impose restrictions, and between physical copies of the work to which the first sale doctrine can be applied and for which the transfer of copies is permitted. Thus, the transfer of the license and the copies of the software already on the machines, and the developer company is not entitled to compensation.