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First-sale doctrine upheld by US Supreme Court

March 20, 2013

USSupremeCourtThe decision will prevent copyright owners from stopping imports and reselling of content sold abroad, which will have major implications for remanufacturing in the USA.

The ruling, in the case Kirtsaeng vs. John Wiley & Sons, corresponded to a Thai scientist living in the United States, Supap Kirtsaeng, who “imported textbooks lawfully printed overseas by a US publisher and sold them on eBay”. The publisher, Wiley & Sons, sued Kirtsaeng, and if they had won,  “content providers could have skirted [US] copyright laws and reasserted control over the use of sold products simply by moving their manufacturing overseas”.

Forbes features an opinion article from the Consumer Electronics Association’s President and CEO Gary Shapiro on the decision, which was made by the US Supreme Court six votes to three yesterday. The implications for cartridge remanufacturing in the USA, as well as many other industries, are that US consumers can “shop worldwide for […] copyrighted content” and “the legal purchaser of a copyright-protected item may dispose of that property any way he or she sees fit”, including reusing the product or reselling it.

Shapiro added that the decision “is a major victory for American consumers because it allows them to shop worldwide for their copyrighted content”, with the court explaining that the first-sale doctrine “makes sense in today’s interconnected world” by recognising that “consumers benefit from greater choice and lower prices when technology companies, libraries, used bookstores and retailers can import and sell products without having to ascertain that the US copyright owner approves of each further sale”.

Adding that “a geographical interpretation would subject many, if not all, of them to the disruptive impact of the threat of infringement suits”, the Supreme Court, Shapiro believes, has “preserve[d] the rights that the first-sale doctrine guarantees to manufacturers, retailers, libraries, consumers and the public at large”.

Shapiro noted that 30 years previously the Consumer Electronics Association had “fought and won a similar battle to preserve the first-sale doctrine” from Hollywood studios concerning VCR rentals and recordings, adding that he personally has spent “a good portion of the subsequent 28 years fending off efforts […] to restrict, tax or ban perfectly safe and useful technology”.

He concluded that the case “serves as an important reminder” that copyright in the United States “must be limited to its constitutional purpose of “promot[ing] the Progress of Science and useful Arts”, with the Supreme Court’s judgement comments yesterday highlighting that “American law […] as generally thought that competition, including freedom to resell, can work to the advantage of the consumer”.

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