plays the card good morning your honor is my name is andrew combs i'm here with any lang from my office and we represent plaintiff and appellant that will be sisters we are here on cross motions on an appeal from cross motions for summary judgment which turn on the application of the copyright first sale defense to software licensed by adult be subject to restrictions which satisfy the court the tests laid out by this court that we don't know  don't know it your honor because we did not get to it because of preliminary procedural errors in the court below which is the subject matter of this field of parties and in my point is that we can't assume that it's sort of at the center of the case whether it is or is correct your honor hardware and to be redistributed only with that hardware doesn't fact satisfy the burner test the courtney too prejudicial errors which prevented it from arriving at this issue and making a conclusion of a substantive application of the defense it rewarded the defendants for their failure to conduct any discovery and then post a burden of proof on adobe that properly lay on defendants and then compounded that error by exploiting a wide array of evidence offered by adobe on the subject of these licensing what is the precise wrong on the part of the district court when you didn't turn over what would be a fundamental basic document and software licensing contrary to do you there are there are there are two issues your honor the first issue is that it was not adobe's burden to do state evidence in the first place because the burden rested on the defense but to go more directly when you have a mandatory disclosure you have any duty to turn over what you have well we did turn over the license agreement in question well you m are just the matrix or are just the mob right that's correct your honor you didn't turn over the agreement an issue in the case and the reason we didn't your honor is because we didn't know what agreement was it issue in the case because the defendants did not establish their hands on the facts here because to be frank the degree in a van and then and thing appointing is really somewhat beyond the pale and makes very difficult for us to understand what actually happened because everybody is saying that everybody else is lying but not particularly telling us what the truth is the software from and what kind of software it was that dealing i'm not completely but even those disclosures did not go back to a lawful acquisition which is their burden to see those that first that's the question not the answer but in terms of whether they  could have produced licenses for the ones that were at issue you could have that know your honor because it was not a sufficient disclosure for us to know which licenses were at issue there were  literally thousands of licenses around the world in different distribution channels for different software during different time frames that were at issue in this litigation and none of the information disclosed by defendants was sufficient for adobe to identify which license agreements that should have produced which comes back to the issue about the failure to disclose it was substantially justified as stated in the pertinent rules because adobe did not know what license agreements were placed in issue by the defendant allegation of the first sale or did you find out its own point no your honor you never find out what life is and this is right if you don't know how to expect the other side to know the other side is the side that has the relationships with its sources not what the original purchaser or licensee know but  we have to you have the relationship we have the relationships with the initial licensees but instead we like it's agreement that division and no it is the one that's at issue but we don't know which one is that issue until the defendants tell us how it got and then x either sub licenses or cells or does something to the christianson here and you're saying they have to tell you who access your honor i think the point is that the chain of title here is more complicated than the disclosed as being the their sources who i'm sorry your honor and did you make any discovery in korea of the people who were just close as being their source we did try but you are this is a gray market and the  or they were responded to in completely or we couldn't find the place or the question you know that's a problem at this case there's a lot of this going on and we have to kind of figure out so those entities or individuals to  discovery cutoff as it related to the sales records with google so i went out one of the things that i understood from your argument is even if you set aside the initial disclosure that there was sufficient documentation in your summary judgment motions some of which relied on documents produced by the other side in my correct about that you're correct here and that's a second reason but what i couldn't figure out from your briefs is tell me which documents in the summary judgment that you think were actually produced that the district court should have focused on in order to rule on the summary judgment can you give me a docket number or any our number and those are printouts of what those are printouts from you don't be web site which identify license agreements that contain the restrictions that were being asserted by adobe right but what's the difference between that and a pro forma agreement i mean how is it your position that adobe has never sold any software ever no your honor but it has never sold any o e m or academic software which is what the defendants concede they distributed or purported to sell in this case but i think the most important evidence on the subject of of the licensing restrictions isn't a documentary because as i've said before we did not know what license agreements we should be addressing to the court to demonstrate see there so if they're saying what licenses you're saying they are like that's isn't how we're supposed to do and then with that respect we are we did have evidence that was excluded by the court and that's part of the insurance before that's why a judge mccain was asking what the evidence was and the evidence seems to be a heavily redacted form license and these training cast from the website which i as i say i did not see you mention to the district judge your honor if they were in the in the money you are having to dispute as to what should be stricken or not stricken you never pointed to the seven you're on when and when we were arguing about what was stricken or not stricken it was largely in connection with a motion to preclude that arguably actually had the terms of any life were these printouts from the website and the document and you redacted talk no your honor on the other documents that evidence the existence of restrictions they did not detail in the the restrictions but they were clearly known to the defendants based on their testimony were the business records of the defendants including invoices from their suppliers saying that these are o e m or academic software so there is other documentary evidence that was introduced that was produced by the defendants and clearly don't basis for excluding it in the court below in considering the motion for summary judgment that get us to the point that it's just a toss up in the air at this point and then there there's a factual our it's our position first that the burden of proof should have been on the defendants you're asking adobe about evidence deduced or tempted to compel well why don't you answer my question of course do you do you think at this stage with all of them are you know in the chain that you've just described you think there's a factual issue as to whether or not there's a license to out we don't we think there's a factual issue as the alternative i mean the the worst case scenario from our standpoint is that there was a factual issue that should have been considered in light of the documentation and testimony that was introduced below and it should be remanded for reconsideration based on the evidence that was excluded in part forward with evidence that they bought it illegally in the sense they didn't steal it and it was a legitimate software the district court viewed at that point said the burn not there was a transaction pursuant to which the right title transferred and i and if you read form and what form it said in a course this is under the one thousand nine act which is that different standard anyway it said that the defendant this is a reversing the district court order which was a subject of a congressional comment is that the defendant's mashal authorization from the copyright owner which the district court found was not the case as to christianson or title acquired through first sale and the defendants did not show that title accords and for so we show that and there's another sentence after that  that was not shown by the defendants here nor was it admitted by just understand your position is as the copyright holder of this particular software that you simply have to put forward that have the for sale defense and the burden then shifts to them and they're important or standing that's correct and that's the important reasons for that because this would expand the scope of inquiry for the courts in measurable adobe would be in a position to do were would be every copyright and every time somebody used the word first element in an answer would then be obligated to open up their entire record of all of these confidential transactions because the defendants haven't pinpointed the ones that are specifically edition that you've used up your time good morning may it please the court i'm lisa rasmussen and i represent josh christiansen and software surplus ink i am a little surprised at some of the things that council is represented because i think i believe that the district court below firmly held that it was it was undisputed that it was a law full sail from the people who acquired the software from adobe and then sold it to my well they had a bill of sale and they sold it and they never steal it or stand right that doesn't mean you have a right to use it i mean when there was no indication to my client that he was purchasing anything other than authorized he purchased were the software along with the activation cuts that's exactly what he was lying that didn't work well you know you have the right to sell to just a licensee i mean another words mr coombe read the statement you know that i think it's virtually common write that the facts of this case and what came out during my client's deposition and what is in evidence in this case is that in two thousand and five adobe contacted my client and asked about his website advertisements on the products he was selling and they said that's fine as long as you have the proper activation codes and job he was fine with it so that is in evidence in this case so it was well you might have got a pig in a poke i mean i don't know so he goes if people that he purchased it from are people who had acquired it directly from adobe do you know that i mean the whole issue here in a way is a chain of custody issues so when you you're telling me that it's not ok if you just buys it off the street in new york so what's the difference between that and what your client did because my client knew that it came directly from adobe and how did your client know that he knew that by talking to the people he purchased it from and buying it off the street i understand i understand the question i think it goes back to the inquiry that adobe made with him back in two thousand and five and also when the discovery started we disclosed fully disclosed all of the  invoices from the purchases that he had made from various people that came directly from adobe to these various providers to my client that was all disclosed to adobe and adobe has never alleged that it out that looking at those evidence and apply plying our standards they were in fact licenses and not sales then you would lose yes so the so it really doesn't have anything to do with a guy on the street in new york it's an all discovery problem exactly where mr christiansen purchased them from and adobe has had every opportunity to even call those people up and say and i don't be knows who it distributes to think this goes back to the problem of placing a burden on mr christianson to put into evidence facts that he couldn't possibly have that are all within the knowledge about how do you do it if you're buying on the grey market i'm just saying that it was one thing if one were to purchase on the grey market basically your position would be all i have to do is buy it i need to tell you why so i got it from my concern with that is doesn't that really circle that the requirements of one zero nine which means you have to have  an owner not just to possess or right but in this case he said here's exactly where i got it that was all disclosed well before the close of discovered who has the burden when you're you're making them for sale  unlawfully he didn't obtain it unlawfully he believes well why wouldn't you obtain it unlawfully if the person i mean that's a question of how you define a lockley if the person from whom he buys it is only a licensee and has no authority to sell  that doesn't necessarily make him a right for a quiet word but if the person from whom he had purchased it didn't have the authority to sell him he wouldn't have had the activation codes adobe issues the not tell me where on the record it says that if you have the activation codes you therefore have the authority to license or so well i don't know that it does your honor so then we're like missing some little piece of this puzzle that's pretty critical because if you think about the brenda probably she could kind of various places in other words your argument is all he needs to show is that he didn't steal direction and seems to me that i mean the one place where i would think the burden of your brand of proof certainly stops is asked to producing the actual licenses one should fit once you get enough information as to what licenses you're looking for because that is in beat but i i don't know that saying that the burden of proof question is necessarily answered by saying you have to do nothing but say i didn't know it and steal it and i and it's and it's subpoenas what one missing king piece and we're talking about was in the deposition of my client when he was deposed by adobe and he explains that these were people who that he had purchased the adobe products from for years and that he would sometimes call and they would say we don't have any right now when it gets closer to the end of the quarter the court fiscal quarter they will release a bunch of codes to us and we will have more product that we can sell you he knew that matches those people in the software i'm not sure adobe says no and what adobe is telling us is that they sent subpoenas and no one responded and they didn't do anything further to follow up on it and they had at those were not necessarily their direct licensees right to whom they were issuing well adobe could have certainly established for the purpose of summary judgment or for the purpose of any of this litigation that the people who from the invoices that we had were not people that adobe dealt sellers were sooner or later if they did something about what kind of software it was so what should they have producing us well what was produced to them from us i can i can tell you what we gave them and i can tell you what they're complaining about receiving later and dribbling and what we gave them or all the invoices from the purchase that mr christianson made what they didn't get into later because we were litigating with google where which is how these things were purchased on line to the google shopping cart was where mr christiansen sold them but the information is all that he wouldn't have gotten any different information the best information was what mr christianson bought the other information that they got later was just who mr christianson sold it to so they would have then learned that nancy smith in idaho purchased a copy and they could have called it nancy smith but there was nothing different they already had all the information on the exact product and that was then the question becomes burden so let me ask you since the defendant is making a defense the under the doctrine of first sale did you subpoena the people from whom the purchases were made to get documentation of any license agreement or the documents under which they would claim title no and you know  so if we were to take your position it would seem to me that all you have to do is literally show possession and where you got it and then you have established a first use defense you need an invoice a position no your honor i don't think that it's i think there is the matter of my client having communications with these people preparing it of yours and knowing that they're getting it directly from adobe based on the context of the conversation which is what came out in his deposition and also that he's getting their activation codes that only they release from these parties now why would i and so is your contention that he did establish the chain of title because he established that he bought it from people who bought it from a job well i don't buy a sale without regard to whether it was a title or a license but he at least demonstrated that he bought it from it was an unlawful purchase that my client made they had all of the information what they what adobe was really saying is that adobe doesn't sell it they license it well i mean they're not and it's a known law what they're saying is put in however many words they're saying you don't have a right to use it under the terms in which you acquired the right i mean that's that what they're saying right that's what they're saying based on this test then you say oh no i have the first sale doctrine right right but in order but the only thing you produce is not to show that the chain of title by which you got it you just produced invoices of say i bought it so in other words we're still missing and a minimum there's a big believe there is a factual dispute because if there were a factual dispute adobe would have produced that information adobe but whose residence ability is it if it's your first used defense because otherwise you basically would abdicate to the grey market in every case because you'd say i have imo i haven't in my possession and i bought it and that makes you no different than the guy on the street buying it from the guy in new york and give you a receipt the guy in the street can say here's a receipt i'm selling it to you so i think that the difficulty comes is that where you identify that there's a hole in the evidence you think it's their responsibility and they think it's yours to fill that hole i well i can tell you what they didn't produce to us was a blank template and that was how they based their whole and it's parsing words on their part that it's not a sale that it's actually a license agreement and then they provide in x is as a means of relationship and they're not even just puting factually in this case that well are you saying that it's a sale under that yes but but they can't you know what why is it a say a what are the terms that tell you it's a sale as opposed to a license where would we look to find that this is where i believe it's their burden you know i'm just ask and you know i understand what you look at that i mean do you have any evidence that it's a sale as opposed to no and they would well let me just go  for self defense first of all you agree generally that the burden of proof on an affirmative defense usually rests with the defendant in the usual case right correct it would be your burden to goes at least you know to a certain extent for instance that there's evidence that shows that the seller your client was dealing with had a direct relation relationship with adobe if you get that far than you seem to be thin the factors set forth by by this court and other courts then the burden shifts to them to show that there is infringement i believe that's what it means and i believe that the district court was correct in first sale right yes so don't you have to establish first sale and to establish for sale you have to show a sale which you haven't shown because you it was a license agreement not a sale agreement until after the discovery deadline because they didn't produce even that blank redacted template so they would they never alleged and actually really when i look back at the pleadings this is an argument that they've come up with more on appeal than they did in the district court below that it was a licensing agreement not a sale agreement so i'm not sure it's something that we would have even zeroed in or focused in on at the time period when we were in the district court because it's something that they've come up with more recently has one yes one about this for gary screenshot of adobe which looks a lot like a licensing well what's that doing in the record and why isn't it at least approve of license i mean this is the screenshot from my client that eats in the record to show that this is the conditions under which he my client was authorized to sell it i believe that's why it's in the record  litigating why we even having this argument why don't we just litigating about the question whether that's a license or a sale i don't disagree with you your honor i but that's not what a district court judge didn't write court never got to that question the district court didn't get to that that there are a couple of comments that i wanted to focus on and other stagers any questions you may have but in terms of the the statements made in two thousand and five these were sort of inadmissible third party hearsay statements there's really no evidence linking either  defendants here or their suppliers to adobe which is the as your honour's noted is the essential missing link have you said that and someone said that from a domain i looked at this list they are not in our direct supplier list we have not licensed any software to these people or  six ninety ninety eight fifty which include some of the disclaimers that were stated that this is only m software this is edu software and there's really no dispute here that the christiansen's and sorry the defendant sales but that software did not comply with the restrictions attached  and that they were therefore in violation of the license agreements so regardless of the the the complete chain of title that we're talking about there's as i say there's no argument about christian or the defendant's own distributions being in violation is not in front of us but it does raise a different now it's a different sort of situation because in that context i think there's no argument that the ass bulk of the inventory is in fact salt and your if there's a reversal of burden based on a small percentage perhaps having been stolen however i think it is fairly clear that the authorities do reverse the burden and place them on the defendants to show that this inventory is not part of the stolen inventory however i think that you may get into a situation where it becomes a balance of probabilities or balance of proof essentially that you know ninety eight percent of the inventory is in fact sold a small percentage isn't and therefore it's not sufficient to hear and you put in evidence a demonstration of that as a legal matter not as a matter of you of books that are published in libraries that doesn't make them not self your honor that i had back i think that there may be books that are licensed rather than sold and that that is that i'm not sure that that issue has been litigated in terms of whether that would pass the first self defense or not but it seems to me that the nature of the medium does not necessarily control the analysis of this court set forth in vernor and which has been applied so the kind of computer software that's at issue in this case thank you thank you your honor thank the counsel for your arguments this morning the case of adobe versus christianson is submitted