First-sale doctrine revisited

October 11, 2012

The Wall Street Journal’s Market Watch brought light to what it described at a “little-known case” on the Supreme Court’s docket this fall, Kirtsaeng v. John Wiley & Sons, Inc. (Supreme Court docket no. 11-697).  As Market Watch summarizes the case:

At issue . . .is the first-sale doctrine in copyright law, which allows you to buy and then sell things like electronics, books, artwork and furniture, as well as CDs and DVDs, without getting permission from the copyright holder of those products.”

Put simply, though Apple Inc. has the copyright on the iPhone and Mark Owen has it on the book “No Easy Day,” you can still sell your copies to whomever you please whenever you want without retribution.

That’s being challenged now for products that are made abroad, and if the Supreme Court upholds an appellate court ruling, it would mean that the copyright holders of anything you own that has been made in China, Japan or Europe, for example, would have to give you permission to sell it.

While this case may be little-known to most of the world, it has certainly garnered attention in the legal community.  The following search in All Federal materials on WestlawNext yields quite a few results from this case:

Search: ti(kirtsaeng)

Among those results are:

Order from the Southern District of New York prohibiting Kirtsaeng from raising the first-sale doctrine as a defense, 2009 WL 3364037;

Opinion from the Second Circuit Court of Appeals challenging the award of statutory damages and determining that the first-sale doctrine does not apply to products made outside the United States, 654 F.3d 210;

Order of the Supreme Court granting Kirtsaeng’s Petition for Certiorari, 132 S.Ct. 1905.

Also included are some interesting law review articles that demonstrate that, while this case may have received little attention in the press or from the public at large, legal scholarship certainly has not been lacking.  These include articles from the Minnesota Journal of Law, Science, and Technology, 13 Minn. J.L. Sci. & Tech. 899, the International Law Update, 17 Int’l L. Update 59, and the Harvard Law Review, 125 Harv. L. Rev. 1538.

The decision in this case could be one of far-reaching impact.  If the predictions from the Market Watch and others prove true, it could fundamentally alter the way we buy and sell items in our daily lives.  One prediction: “it could become an incentive for manufacturers to have everything produced overseas because they would be able to control every resale.”  The idea of having to give Houghton Mifflin a cut every time I buy or sell a Curious George book for my kids at a rummage sale certainly puts an intriguing perspective on the outcome of this case.

I’ve already got my alert set up to keep me up to speed on the developments in the case.  If you’d like one too, give us a call, and we’ll help you get the WestClip set up.

For more background on the first-sale doctrine generally, try the following plain language search on WestlawNext:

Search: copyright first-sale
Jurisdiction:  All Federal

Some helpful secondary sources from that result:

Burden and sufficiency of proof under “first sale” doctrine in prosecutoin for copyright infringement, 94 A.L.R. Fed. 101

Transfer of particular copies; “first sale” doctrine, AMJUR COPYRIGHT § 100