By Stephanie A. Huang, Esq.

Software, which can cost thousands of dollars sold in a retail store or directly from the
manufacturer, can be bought at a significant discount on websites like Craigslist, EBay,
and the like.

However, buying a used copy of a particular software program can put the buyer in
violation of licensing agreements and copyright laws that are meant to protect the selling
company’s rights to sell their unique product. Even buying a “new” copy of the software
from any outlet other than the manufacturer itself or one of the listed “authorized
resellers” is a potentially risky business practice. This is because the purchaser usually
only obtains a license to use the software according to the terms of the manufacturer’s
licensing agreement.

For instance, the most popular software used by architects is the AutoCAD program.
AutoCAD only sells a license for the program, which provides that the buyer does not
have the right to sell or even give away a legitimately purchased copy to someone else.
AutoCAD’s position is that you do not even have the right to let a friend borrow your
copy of the program to install on his own computer – as a licensee, you are given
permission to use the software program on your computer only (and often only on a
single computer, not multiple computers to which you have access or may own).

Over the past few years, many companies like Autodesk and even Microsoft have been
cracking down on small businesses that have been using allegedly illegitimate copies of
software. Small businesses that have a disgruntled employee might discover a letter from
a law firm on behalf of Autodesk demanding an internal audit of all computers, searching
for any illegitimate copies of copyrighted programs. If any illegitimate copies are found,
penalties and even lawsuits could result. To avoid being sued, small businesses often pay
at least double the original retail price of the software program.

To help avoid such pitfalls, small businesses should have a formal written policy for their
employees, staff and even temporary workers to not install or use any software program
that is purchased by the business without proper authorization. Such a policy is good
protection against unknown software violations and also against unauthorized computer
programs and software, including files that are downloaded and accessed on the Internet,
which can easily and quickly introduce serious, fast-spreading security vulnerabilities and

So even though it might seem cost-effective to buy a cheap Craigslist copy of AutoCAD,
or to borrow someone else’s copy, think twice about how much you could end up paying
down the road for such a “good deal.” You really do get what you pay for