The "Death Penalty"...

> > How is it that someone is accusing the Chinese supplier of infringing the GPL, when they actually are not infringing?

> Because they want to actually hack on their own code? You know: exercise rights GPL was supposed to protect.

So what you're saying is: the customer would first ask the US company for the source, who would say "We got the source from our supplier, but we won't give it to you. Go talk to the supplier instead", and then the customer would actually do that (instead of pursuing legal action against the US company). That's not very believable.

> > Either the "original copy" contains source or it doesn't.

> This is insane interpretation of GPL - not even FSF trying to do that.

It's not even an "interpretation of GPL" at all, nor does it apply to any one license in particular. It's just a tautology.

> GPL does not ask to include sources in binaries, it demands to accompany binary with source.

You said that the Chinese supplier did accompany the binary with source. Therefore, the physical object that is considered the "original copy" for purposes of first-sale must be something containing both source and binary.

Now, I suppose that the US company might try to use a loophole such as this: the Chinese supplier puts on the distribution server two files, one containing source and the other containing the binary, and then the US company downloads only the binary one. (Actually, they could do this even if the server only contanied a single file with both source and binary — they could download only the binary by sending an HTTP request that has a "Range:" header, such that only the section of the file containing the binary is downloaded!) Then, when the US company gets sued, they say in court: "We did give the customer the exact original copy that we received from the supplier. Sure we could have gotten the source from them, but we didn't actually do so. Therefore, the supplier is the guilty one, not us." But that's so obviously unfair to the supplier that the US company would never get away with it. And even if they did somehow get away with it, then they'd be banned from importing from that supplier.

(It's exactly this kind of issue that makes it difficult to establish exactly what the "original copy" of a download is. That's why I believe that the courts would just take the easy way out and establish a precedent that first-sale rights simply don't exist for copyrighted works distributed by download.)

> This depends of where the version captured from the wire and stored on physical media (HDD in regular case, firmware in GPL-circumvention scheme) is "original copy" or the copy created via §117 exception. If it's original (as you try to imply)

No, I never tried to imply that the "original copy" here is the one stored in HDD or flash RAM. If I had to guess, I'd guess that the other possibility (the original was the Ethernet wire or the NIC RAM chips during the brief time they contained the data, and therefore the original no longer exists) is the one that applies in this case.

> You've said many times that you don't need to keep the content of the RAM used by your NIC device and you don't need to have any license to enjoy exceptions granted by §117.

For the §117 rights, that's true — because it doesn't matter whether the private copies you made are one, two, …, or N generations away from the "original". So, for example, you can copy it from NIC to HDD (passing through CPU RAM and the disk controller along the way), then from HDD to a flash drive, from flash drive to another computer's HDD, etc etc.

But the first-sale right is a different matter altogether — it means that you are allowed to sell the "original", but not any copies of it (in fact, §117 says that you must destroy all such copies when you sell the "original"). So if the courts decide that the NIC RAM was the "original copy", then you can't exercise your first-sale rights at all for downloaded software.

> when the content of the RAM used by your NIC device is lost you still keep original (or else §117 will demand that you destroy all copies)

No, §117 doesn't demand that you destroy all copies when the original is destroyed. (If it did, that would totally negate the point of allowing you to make "archival copies".) It demands that you destroy them when you lose the right to possess the original copy — in other words, when you sell the original copy, or when a court decides that you didn't actually own the original copy in the first place (which is what happened in Vernor v. Autodesk).

> correct original is most definitely the copy on HDD

That's not obvious at all.

> I agree, I messed up when I thought GPL-circumvention scheme requires use of §117: it does not

Yes, now that I think about it, it's not actually correct that "they would need to invoke more than just §117, but also the "first sale" right" — instead, §117 is totally irrelevant in this case, and all that matters is whether "first sale" applies or not.

> at least not directly. Instead it uses indirectly: to establish just what is “original copy”.

§117 does not clarify exactly what is the "original copy" in the case of software distributed by download. That is something that's up to the courts to decide.

And I expect that in the event that a router manufacturer did try to invoke first-sale rights in the manner that you described, the courts would quickly establish a legal precedent that the first-sale right only applies to distribution by tangible media, and not to downloads. In fact, I believe that this is already the general consensus, at least among companies in the pay-to-download business (e.g. GamersGate, GOG.com, eMusic, Amazon, etc.), and among companies in the used-media business (e.g. thrift stores, used record stores, etc.). For example, suppose that I take a DVD+RW disc full of Windows games (DRM-less ones, even) that I downloaded from a pay-to-download store to a local thrift store, and say to them "I bought these legitimately and I've deleted all my copies of them other than the ones on this disc, so it's legal for you to buy this disc and resell it; will you buy it from me?" They'd tell me "no, we won't buy it" for sure, because they're not willing to take the risk that first-sale rights don't apply in this case. (And this same thrift store does sell used CD-ROMs with PC software.)

> Take your pick: either you need a license (implied or otherwise) to download and use any software or you don't need it and then it's Ok to sell GPL-compliant routers without source using aforementioned scheme. You can not have both at the same time.

Take your pick: either the source-less firmware in the router is the "original copy" (in which case the Chinese supplier is guilty of copyright infringement), or it is a non-original copy (and maybe not even an exact copy) made by the US manufacturer (in which case the US router manufacturer is guilty of copyright infringement). You are the one who's trying to have it both ways!