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Vermont v. United States, 61 AFTR 2d 88-788, 88-1 USTC par. 9169
(D. Vt. 1988). One would not pay thousands, or even tens of
thousands of dollars, for the disk or tape without the software's
intellectual property placed thereon.
The software here acquired was sold subject to nonexclusive,
nontransferable license agreements. Pursuant to those agreements,
petitioner was entitled to use the software it purchased in its
banking and related activities but was not permitted to reproduce
or resell the software to others. It is clear from the license
agreements that petitioner was interested only in using the
intangible programs contained on the tapes and disks. This point
is demonstrated by the description provided in a license agreement
entered into in conjunction with the purchase of "ESTIMATICS"
software from Management and Computer Services, Inc.:
The intangible knowledge, information and
know-how to be made available hereunder shall
be provided on 5 1/4" diskette for the IBM
personal computer.
C. A Computer Program Is Not Inextricably Bound to a Single
Tangible Medium
Software's intellectual property is fluid. The intellectual
property was placed on a tangible medium simply for ease of
transmission. The initial housing of the intellectual property on
a tangible medium is temporary, and ultimately, the program's
intellectual property is mirror-image transferred onto a computer.
And it is this mirror-image transfer that the purchaser of the
computer software desires when acquiring the software. Upon the
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