Computer Software Rental Amendments Act of 1990 (CSRAA), Tit. VIII of the Judicial Improvements Act of 1990, Pub. L. No. 101-650, 104 Stat. 5089, 5134 (Dec. 1, 1990), codified at 17 U.S.C. §109 (full-text).
The Act amended 17 U.S.C. §109 to prohibit any person
|“||for the purposes of direct or indirect commercial advantage [to] dispose of, or authorize the disposal of . . . a computer program acquired on or after December 1, 1990] by rental, lease or lending, or by any other act or practice in the nature of rental, lease or lending.||”|
Rationale for the amendment
Behind the amendment was a concern that commercial rental of computer programs encouraged illegal copying of the rented programs, depriving copyright owners of a return on their investment and discouraging creation of new works.
Impact on the "first sale" doctrine
By granting copyright owners of computer programs a newly created "rental right," Congress created an exception to the "first sale doctrine." This traditional copyright doctrine, which is codified in section 109 of the 1976 Copyright Act, limits the copyright owner's exclusive right of distribution by allowing the owner of a particular lawfully made copy of a work, or any person authorized by that owner, to sell or otherwise dispose of possession of that copy without authority of the copyright owner.
The 1990 amendment also includes a special provision permitting nonprofit libraries to lend computer programs for nonprofit purposes, if the packaging contains a prescribed warning of copyright. This "library lending" provision is an express exception to the new "rental right" which is itself an exception to the basic "first sale doctrine." In creating this exceptional prerogative for nonprofit libraries, Congress was aware that, like commercial lending, nonprofit library lending could trigger unauthorized copying.
Further, the amendment asked the Register of Copyrights to make a three-year study and prepare a report on the extent to which the exemption for nonprofit libraries "has achieved its intended purpose of maintaining the integrity of the copyright system while providing nonprofit libraries the capability to fulfill their function," including any information or recommendations the Register considers necessary to carry out the purposes of the subsection. That report was published in 1994.
- 17 U.S.C. §109(b)(1)(A).