Supreme Court To Review If It's Legal To Resell A Book You Bought Abroad
from the first-sale-ftw dept
This isn’t a huge surprise, but it’s good to see that the Supreme Court has agreed to hear an important case regarding the first sale doctrine in copyright law, and whether or not it applies to products made outside the US. The specific case is one we’ve been covering, involving a guy, Sudap Kirtsaeng, who was (legally) buying textbooks that were sold in Asia, and then reselling them in the US. Under the first sale doctrine this should be perfectly legal. But… due to a twisted interpretation of copyright law, a 2nd Circuit appeals court went against Kirtsaeng, siding instead with publisher John Wiley. The issue is that the law says that first sale applies to copyrights to products made “under this” law. And the argument is that a product made outside the US may have copyright, but it isn’t made “under” US copyright law, and thus it doesn’t qualify.
As the dissenting judge in the 2nd Circuit noted, this interpretation doesn’t make any sense. The law doesn’t say anything about location, just about whether or not it was “manufactured lawfully” under the terms of the law. So, as the judge noted, as long as the product can be subject to US copyright law, then first sale should apply. This makes sense, and hopefully the Supreme Court agrees.
Of course, the Supreme Court has addressed this to some extent. The 9th Circuit had ruled similarly in the Omega/Costco case, and while the Supreme Court had taken the case, Justice Kagan recused herself from that case, because she had said that the first sale doctrine should not apply to foreign goods. And, in the end, the court split down the middle. So that means that, as a deciding vote, there’s a reasonable worry that Kagan will again say that the First Sale doctrine does not apply to foreign goods.
This is a dangerous and stupid interpretation of the law. It will cause tremendous trouble for anyone trying to sell pretty much any product made outside the US, because makers can claim that no one can resell such products without getting a new license. It will also drive more works to be made offshore, since (especially the copyright legacy players) will look to completely get rid of the first sale doctrine by “manufacturing” everything offshore. Hopefully, the Supreme Court recognizes the ridiculousness of such a result, but the result in the Omega case was not encouraging.
Filed Under: first sale doctrine, resale, scotus
Comments on “Supreme Court To Review If It's Legal To Resell A Book You Bought Abroad”
The bigger picture
There is an easy solution to all this if the Supreme Court splits down the middle and decides the First Sale doctrine does not apply to foreign good.
The solution being that since Any foreign goods not made under the law are not included under that law then by definition they are not bound by copyright law in the USA therefore cannot infringe that law either
This means that say Apple products were made in china, then anyone could sell, and do anything to those apple products including sell them in the USA without worrying about copyright, then on the flipside because goods like for example Movies can only have copyright on them in the USA (USA copyright) then anything that happens to them in foreign shores can ALSO not be done under the copyright of the USA either.
Maybe the 2nd Circuits non dissenting judges were onto a great idea.. Wipe out the Berne Convention in one swell swoop thereby allowing non-USA jurisdictions their own sovereignty back to decide their OWN copyright laws or lack thereof..
Awesome!
Re: The bigger picture
Since the Richard O’Dwyer case it seems that US copyright law applies worldwide anyway so the argument about “not made under this law” is moot isn’t it.
Or are the maximalists going to be able to have their cake and eat it AGAIN?
Re: Re: The bigger picture
i can confirm this, i have it in black and white from this uk government, direct from the office of Brandon Lewis MP.
Quote “As regards the case of richard ‘Odwyer, he was wanted in the US for offences related to copyright infringement. He appeared at westminster magistrates’ court on 13 january where the district Judge found there are no legal reasons preventing his surrender to the US. Accordingly, the district judge sent the case to the home Secretary for a decision as to Mr O’dwyer’s surrender and, in line with the requirements of the current legislative framework, the Home Secretary signed an order for Mr O’dwyer’s extradition to the US.”
I have to wonder if there are any other american laws we have to worry about breaking in the uk, even if they are legal in the uk.
Leave a message here if you want a full photocopy of the letter.
Re: Re: Re: The bigger picture
I’m interested in that letter.
But it’s rather ironic that we’re deporting a UK citizen when the “crime” is legal in their country and that’s exactly what the American Revolution was all about.
Re: Re: Re:2 The bigger picture
Yes, i’m more interested in why this happened to, although as you can imagine, they refuse to answer the initial question, which i will be sending in again.
Re: Re: Re:3 The bigger picture
oops forgot, what is the best way to contact, i dont see an email address in your profile.
I will then send a copy of the question i asked as written, and a photocopy of the reply.
Re: Re: Re:4 The bigger picture
Why not use a mediafire account and post it for all to see?
Re: Re: Re:5 The bigger picture
Maybe he/she is afraid of extradition? 😉
Re: The bigger picture
Unfortunately, it’s not that easy. The implication of the Second Circuit case is NOT that if something is made overseas, then U.S. copyright law ceases to apply. Rather, it’s that if it’s made overseas, it is no longer “lawfully made.” That is, everything made abroad is essentially unlawful (under U.S. law) and the minute it touches U.S. shores, it can be blocked by the copyright holder.
Re: Re: The bigger picture
“everything made abroad is essentially unlawful (under U.S. law)”
Only if you are a pleb.
This obviously does not apply to those with a lot of freedom of speech in their swiss bank accounts.
Re: Re: Re: The bigger picture
Eh, it definitely applied to Costco. And I imagine that, as a big corporation, it has plenty of cash.
Re: Re: The bigger picture
As the post makes clear, the problem is that the products are (arguably) not made “under this title”. “This” being the US copyright regime. It’s not that the products aren’t “lawful”. Everything made abroad is not unlawful. If the US considered everything made abroad unlawful, the world would be a very different place.
Re: Re: The bigger picture
The problem with this whole situation (and I was being slightly sarcastic in my post) is that Copyright is a license given to someone that under US law itself cannot be sold in part, only licensed in whole.
Therefore the owner of the product in question has a dissonance:
Either they own the copyright fully on the product for all markets
or they only own the copyright fully in some markets.
If it’s ALL markets (which is what the Berne Convention stipulates) then if the product is manufactured legally (by the copyrighters authority) in a foreign jurisdiction (illegally means counterfeit and that’s a separate thing) and they also claim copyright within that jurisdiction then stating that NO we only allow part of our copyright licence (the part that allows first sale) when only manufactured in the USA for sale in the USA then they have limited their own copyright. Which cannot under current US law be allowed (righthaven prime example). Or they lose the copyright in some places but not in others.
Also if the First sale doctrine is in question under “lawfully made” this would also allude to ALL parts of the Copyright statute to be under the same definition, meaning US copyrights cannot be used outside the USofA creating an anomaly under the Berne Convention (and a breach under the treaty)
You cannot have it both ways since Copyright cannot be licensed piecemeal with parts stripped for the convenience of one side.
Its the same as stating that contracts are voidable in the USA if the contract was created overseas by both foreign and US entities and the US party breached the contract whilst in the USA. It wont fly internationally and will affect your economy in ways you cannot imagine.
Re: Re: Re: The bigger picture
Interesting. So if the Court rules against First Sale, and a few foreign-based producers/publishers were to raise a stink over this and how it effects their exports etc, we could see some political (and maybe economic pressure through sanctions) put on the US government. It might even negatively effect the TPP negotiations (“If the US can’t abide by prior treaties of this nature, why should we pursue a new one with them?”), not to mention destroying any remaining support for ACTA.
It would be extremely ironic if pursuing this expansion of copy protectionist power domestically cripples their agenda both domestically and abroad.
Re: Re: Re:2 The bigger picture
Ironic is one word you could use, though I prefer karmic
Re: Re: Re: The bigger picture
Copyright is a license given to someone that under US law itself cannot be sold in part, only licensed in whole … Copyright cannot be licensed piecemeal with parts stripped for the convenience of one side.
I’m not sure this is correct under US law. You are allowed to split your copyright into many different pieces to license out (which is why it’s often referred to as a “bundle of rights” that can be unbundled in the marketplace), but at the very minimum, each license must pertain to one of the enumerated rights under Section 106 of the Copyright Act (reproduction, distribution, adaptation, public performance, public display). Righthaven stumbled by essentially giving the bare right to sue, which is not one of those 106 rights.
Also, I think a distinction might need to be made between the copyright itself and the limitations on copyright. The first sale doctrine is not a right of copyright, but a statutory limitation on the enforcement of copyright. Curtailing it doesn’t actually adversely affect the rights of the copyright owners — in fact, it increases their power. The principle of national treatment under Berne and similar agreements states that you cannot give foreign copyrights any less protection than native ones, but it doesn’t mean you can’t give them greater protection (i.e. not applying the first sale limitation until the copyright holder authorizes the first sale). So the lack of parity may be a moot issue.
Also, as you probably know, Berne isn’t self-executing, and the US has arguably been out of lockstep with it for years. The question is, who’s gonna call us on it? I think we paid a fine once under TRIPS for one of our statutory limitations on public performance rights that violates Berne and never bothered actually correcting the law itself; nobody’s come after us for it. Yay for being too big to fail!
Re: Re: The bigger picture
If it can be blocked by the copyright holder, then it means the copyright laws apply to the product.
If it’s unlawful if made overseas, even the manufacturer couldn’t import it.
So either its lawful in the US and the first sale doctrine applies or its unlawful and manufacturers can’t important copyrighted material into the US.
Correct me if I’m wrong (I haven’t read these cases in a while), but didn’t the courts say the first sale doctrine applies to foreign-made goods if they’re subsequently lawfully imported/sold within the US? If I manufacture products in China, then have them shipped over here and sold, they’re subject to exhaustion (i.e. first sale) even though technically not made under our laws. So the only advantage to manufacturing copyrighted products offshore would be if the owner never intends to distribute those copies domestically in the first place. In that regard, it’s not so much “killing off” the first sale doctrine as it is trying to squeeze the goods into a region-lock, where they get to limit the domestic supply regardless of how much they sell worldwide. But still, once those domestic copies are sold, they can be resold infinitely. (Mind you, I’m not disputing the fact that it’s still a stupid limitation on the first sale doctrine solely intended to preserve a particular business model at the expense of a proper globalized market. It’s just not the doctrine’s death-knell, as some seem to be framing it.)
Re: Re:
“subsequently lawfully imported/sold within the US”
What – exactly – does this really mean?
Re: Re: Re:
Suppose a book is (legally) made in China. According to the 9th Circuit, the copyright holder can prevent you from importing the books into the U.S. and reselling them.
BUT suppose the copyright holder itself imports in those books and sells them. Now you can resell the books.
Re: Re: Re: Re:
The next step will be people who own websites outside of the USA, reside on foreign soil and sell used products, Who unwittingly (or intentionally) sell products that are legal in their own jurisdiction and also legal in the USA as well (ie: not Illicit).
What’s the bet ICE will try for extradition on these people because they are allegedly (under US unethical law) Infringing copyright.
Re: Re:
That’s the rule in the 9th Circuit at least. See OMEGA SA v. Costco Wholesale Corp. and Parfums Givenchy, Inc. v. Drug Emporium, Inc.
If the Supreme Court rules in favor of this twisted logic, which I think they will given the current governments stance on copyright, expect every company under the sun to invent some new business models to prevent their products from ever being resold.
For example, I could completely see Nintendo “licensing” the right to sell games, that were produced in Japan by “Nintendo shell company #1 LLC” and then attempt to shut down the used game market stating that the end-user didn’t have a license.
Many companies have been kicking up dirt over the last 10 years about getting a piece of a resell market, this is just the next step to claim it. I have zero faith the Supreme Court will rule in the favor of First Sale — or US citizens — and instead, politicize the issue like so many other issues the last few years.
This is just a waste of our time. If SCOTUS was to do anything of worth for the public, it would question every copyright law written after 1908 and realize they need to be abolished.
Copyright has never proven itself to be a protection since its inception but more than enough proof exists for its true purpose: to hinder.
I’m at a loss how anyone can defend these ridiculous laws with all the abuse surrounding them.
Re: To Promote Creativity
The purpose of copyright has morphed from providing a content creator with a limited right to foster creativity to a “toll-booth” to extort revenue. Not only that, but it criminalization has also been added. Try to circumvent the “toll-both” – get penalized.
Well, I guess I have a stupid question then
If the selling of these particular books is not protected by US copyright law, exactly what law is being used to charge the seller? Is it not the copyright law? Is the publisher not arguing violation of copyright?
If copyright law applies when charging the person with copyright infringement then shouldn’t the whole law apply and he is protected under first sale?
Re: Well, I guess I have a stupid question then
Agreed. How can copyright s be enforced ‘this law’ yet not first sale under the same law?
Re: Re: Well, I guess I have a stupid question then
Quantum legality?
Re: Re: Well, I guess I have a stupid question then
If you stop trying hard to find a problem, and actually THINK for a second, you may actually understand.
A work is copyright. A book is an approved copy of that work, “licensed” for sale (ie, the rights to that single copy granted… blah blah blah). That license is often “in a certain country”, as the sale of a book may be licensed to many different companies over different territories.
Now, when you buy a book in, say, Chile – it was sold licensed for Chile, not for anywhere else. If you bring it into the US and resell it, you don’t actually have a license to do so.
The work is still copyright, but your rights (as the buyer in Chile) do not extend into the US. The work is still copyright here, and technically, the book in your hands (even without resale) is a “grey market” copy. You don’t really have a license for it, but nobody is going to object because you did buy it in good faith.
However, if you try to resell it as a grey market book (or worse, try to represent it as the full and legit licensed in the US copy) you have violated copyright, because it’s not in the terms of your original sale.
The copyright on the work doesn’t change – it’s still copyright. The book is in violation because it is NOT licensed in the US, not because the copyright itself is invalid.
I know, it’s hard to understand.
Re: Re: Re: Well, I guess I have a stupid question then
There are two aspects. One the book, which is something physical and the content, which is abstract. What is copyrighted is the abstract content. Subsequent selling/trading of the physical book does not affect the copyright privilege.
You are also, unfortunately, buying into the concept promoted by the content industry that the buyer never obtains an ownership privilege to the physical book. This is an absurdity. This land-grab by the content industry needs to be ended.
If one applies the expansive licensing concepts promoted by the content and tech industries to all retail products you wouldn’t even be able to change the spark plugs in your car without going to an authorized vendor approved customer service satisfaction center.
Re: Re: Re: Well, I guess I have a stupid question then
No, it’s simply insane.
Copyright should not prevent the resale of legally produced objects. Copyright should prevent the copying of the contents of those objects.
If I buy a legally produced book anywhere in the world, I should be able to sell that book as I wish.
Licensing be damned — that would apply to what I do with the contents of the object, not the object itself. I’d need a license to produce more copies, but not to resell copies legally obtained. The abuse of the concept of licensing needs to be addressed.
It’s one of the big problems with the law — the law works well in a imaginary world that lawyers have invented, not the real world. We need law that works in the world we all live in.
Re: Re: Re:2 Well, I guess I have a stupid question then
If I recall, the argument being made was that first sale applying to foreign made goods would decimate the ability of copyright holders (like textbook makers) to charge different prices in different markets based on what is deemed “reasonable” from jurisdiction to jurisdiction. They can charge more for a textbook in the US because our per capita income is higher, but charge less in a third world country where money is tighter. The goal is actually somewhat laudable in that respect, ensuring that copyrighted products can still be made available at a reasonable price in less-well-off countries without companies having to worry about taking a bigger hit to their bottom line by someone importing those cheap copies into first-world-nations for resale.
It actually puts anti-maximalists into kind of a catch-22, myself included. We applauded the SSRC report on piracy in emerging economies for reporting that infringement isn’t an enforcement problem, but a business model problem. That if more copyrighted content were made available at reasonable prices in those emerging economies, piracy would decrease. But what if those prices are untenable as a blanket one on the worldwide market? The solution would be region-locking, as the courts are doing with the first sale doctrine. So if we push for the first sale doctrine to apply no matter where a product was made, we’re also destroying one of the few existing business models that allows copyright holders to address the issue of piracy by actually giving the market what it wants.
Re: Re: Re:3 Well, I guess I have a stupid question then
Yay! You’ve confused my mind with conflicting opinions I didn’t know I had.
Re: Re: Re:3 Well, I guess I have a stupid question then
Yup, you nailed it.
The real issue in the long run is competition from your own product. It’s actually worse than piracy in many ways, because the product (and the retailer) looks legit on the surface, there is often no sense of doing anything wrong for the consumer.
The reasonable market price for a book (or a dvd) in many parts of the world is very low. It is possible that it would be cheaper for a company to buy product in that low price country, and ship it to the higher price country and make money. It would put incredible pressure in those low price markets for the retail price to be MUCH higher, to avoid this risk for the creators… which would in turn take the product out of the hands of people in that market who cannot afford it.
“So if we push for the first sale doctrine to apply no matter where a product was made, we’re also destroying one of the few existing business models that allows copyright holders to address the issue of piracy by actually giving the market what it wants.”
Beyond the issue of piracy, you are actually pushing those copyright holders OUT of the market entirely. They won’t bother to sell in any country where the price difference to their main (profitable) markets is big enough to encourage this sort of thing. That’s not a positive for people who live in the lower price markets.
Re: Re: Re: Well, I guess I have a stupid question then
The problem with what you’re saying is that if American Joe goes on holidays to Foreign Country X, buys a random paperback novel, reads it, brings it back home with him in his luggage…is he then barred from re-selling it? I would surely hope NOT!
Perhaps you and the lawyers need to read carefully – C O P Y R I G H T. Copy…Right. COPYRIGHT. Not ResellRight, but COPYright. Copyright deals with lawful and unlawful COPIES of works, and the production of copies (which is in and of itself an absurd concept to try and police in today’s computerized world). Copyright law says that Random Joe can’t make a copy of that paperback he made on holiday – it DOES NOT say he can’t resell the novel, irregardless of whether the book was ever published or copyrighted in the US.
Re: Re: Re: Well, I guess I have a stupid question then
The problem with what you’re saying is that if American Joe goes on holidays to Foreign Country X, buys a random paperback novel, reads it, brings it back home with him in his luggage…is he then barred from re-selling it? I would surely hope NOT!
Perhaps you and the lawyers need to read carefully – C O P Y R I G H T. Copy…Right. COPYRIGHT. Not ResellRight, but COPYright. Copyright deals with lawful and unlawful COPIES of works, and the production of copies (which is in and of itself an absurd concept to try and police in today’s computerized world). Copyright law says that American Joe can’t make a copy of that paperback he bought on holiday – it DOES NOT say he can’t resell the novel, irregardless of whether the book was ever published or copyrighted in the US.
Re: Re: Re: Isn't this just a licensing dispute?
Yes, this seems more like an issue of a product licensed in one territory being sold in another territory where there is a different licensee.
Licensing in different territories happens all the time in music, but the only way to get in trouble is if a licensee (label or distributor) from territory A turns around and sends a ton of product to territory B, thereby flooding the market & taking away sales from the licensed label/distributor in that territory. But the key is that the violator is the licensee who sells directly to a forbidden territory.
It happens a fair amount, and when a licensor grants licenses to multiple countries in a tight area (think: Europe) this kind of stuff pops up more often.
Usually it’s not cost-effective though- you see it in the higher prices that import records & cds get in record stores.
But if I read the post right, the initial sale from the licensee already happened in the licensee’s territory. The importer is just reselling it, which should be kosher.
Re: Re: Re:2 Isn't this just a licensing dispute?
So actually, it seems like it’s an open and shut case, or it should be. If one licensee was intruding on another licensee’s territory, that’d be an open and shut case too, just in the other direction.
Re: Re: Re:2 Isn't this just a licensing dispute?
“Licensing in different territories happens all the time in music, but the only way to get in trouble is if a licensee (label or distributor) from territory A turns around and sends a ton of product to territory B, thereby flooding the market & taking away sales from the licensed label/distributor in that territory. But the key is that the violator is the licensee who sells directly to a forbidden territory.”
Well, it’s often more complicated than that. If Licensee A is getting a much lower license fee because the market doesn’t support high prices, he may be selling the product in that local market at a price lower than the wholesale / license price in another market.
So some biznezman comes along, buys up 10,000 copies of something below the wholesale price in the other market, imports them, and resells them at a price much lower than the official licensee can offer.
Neither licensee A or B broke the law, but the BiznezMan type profits grandly by circumventing the licensing. Yes, the copies are legal, in their original country of origin. But they are against the license granted in the higher price country.
For Rikuo: Let’s be fair here. I don’t think anyone really gives a crap about a single book bought by a single person who may resell it later. That is nearly a strawman argument, something outrageous to get your attention. The real meat and potatoes of the situation is companies or individuals who import significant quantities of things in the “grey” market. Don’t get caught up in the single guy, single book issue, that is something put in front of us to piss us off. It’s not realistic.
This even needs review?
How would this impact commerce? There are DEDICATED stores that sell used books. We also must consider college textbooks as well, right?
Not sure if Amazon sells used books, but I know they do DVD’s and CD’s.
How many businesses out there sell ‘used’ items?
If this would apply to books – why not cars, houses, computers, appliances, furniture, clothing.
So should we shut down all the thrift stores, pawn shops, used book stores, used record/DVD/CD stores?
What about Video rental places like Blockbuster selling used movies?
But the real kicker will be libraries and schools – selling used books too. I buy used textbooks from schools (there’s a dedicated site for this too) for my daughter’s home-schooling.
This is totally ASININE.
I have never sold any of my books, even college text books, but if it becomes ‘illegal’ to sell used books – I won’t buy news ones OUT OF SPITE.
This is just ASININE that it even needs ‘looked into’.
Re: Re:
The logical pretzel is becoming increasingly convoluted. Eventually no one will be able to make a decision.
In fact, this increasing complexity puts the Rule-of-Law into jeopardy. Arbitrary and capricious legal decisions based on obscure principles and dubious logic.
This is probably a ridiculous question
Why isn’t selling a legally created book just considered selling a pile of paper? I understand not being able to recreate the work without licensing, but the copyright holder gave permission to have it printed, and once it’s printed isn’t it just an object and not an idea?
Re: This is probably a ridiculous question
As near as I can tell, the maximalist crowd tends to think there is no difference between objects and ideas.
Re: This is probably a ridiculous question
See if my answer here helps explain it.
I expect the Supreme Court to just roll over for the corporations, like they’ve been doing.
foreign markets
You are all missing the larger picture: the issue isn’t whether he can buy a book made in India for that market and sell it in the US. The issue is that for 200 years publishers have DRM’d the whole world with regional rights. Wiley got its start in 1807 by importing books from the UK (legally, they are at pains to point out in their corporate history “Knowledge for Generations”) and helped build the book business in America around the copyright maximalism that enforced regional rights (which they are also at pains to point out in “KfG”). But in a world of overnight shipping and electronic books regional rights are as much a relic of the old world as schooners and quills. There is one market now, the whole world, and where a book’s made and sold is irrelevant to consumers. Corporations can continue to fabricate rights, then claim them as natural and try to enforce them. That doesn’t mean consumers will behave that way anymore.
Freakin’ seriously?
Well, I guess I have a stupid question then
It’s a good thing that court decisions revolve around how difficult the ruling would be for corporations.
Isn't this just a licensing dispute?
So where’s the boundary? A person selling two books? A small bookshop? A small chain? Barnes and Noble?
foreign markets
Witness the monumental idiocy that is DVD region coding.
The bigger picture
Actually, I think that’s exactly what they’re arguing — that a copyrighted product made abroad and not sold in the US by the copyright holder, is illegal to sell in the US at all.
And as I understand it, the US usually allows you to import “illegal” purchases from other countries, as long as the purchase is lawful in the other country, it is only for personal use, and it isn’t in itself illegal to possess (certain weapons, child porn, etc).
I personally believe that argument completely defeats the entire purpose the first sale doctrine even exists — you have the right to use/abuse/sell your physical property as you see fit.
cummon… admit it…
the USA doesn’t WANT an economy 😛
Well, I guess I have a stupid question then
vccv