Supreme Court To Weigh Copyright Case On Resale Of Foreign-Made Goods
17 April 2012 - 5:44AM
Dow Jones News
The Supreme Court agreed Monday to hear a copyright infringement
case involving resold textbooks that could have significant
implications for discount stores and other vendors that resell
foreign-made goods.
At issue are lower court rulings that found an entrepreneurial
college student liable for copyright infringement for reselling
foreign-edition textbooks on eBay. Supap Kirtsaeng asked friends
and family in Thailand to buy copies of the textbooks, where they
were cheaper. He says he resold them in the U.S. and used the
profits to help pay for his U.S. education.
Textbook publisher John Wiley & Sons Inc. sued Kirtsaeng and
won a $600,000 copyright infringement judgment against him. Courts
rejected Kirtsaeng's defense that he was protected by the
"first-sale" rule in U.S. copyright law, which generally holds that
a manufacturer can't restrict the resale of a product once it has
sold the product a first time.
Wiley said it never authorized the foreign-edition copies to be
sold in the U.S.
An appeals court said that first-sale rule didn't apply to goods
that were produced outside the U.S. The Supreme Court will review
that ruling, marking the second time in recent years the high court
has tried to resolve this issue.
The justices split 4-4 on the legal question in a 2010 case
involving Costco Wholesale Corp. The tie was possible because
Justice Elena Kagan was recused in the case, having worked on it
while she served as U.S. solicitor general.
In that case, Omega SA, a unit of The Swatch Group, alleged that
Costco violated U.S. copyright law by selling Omega Seamaster
watches it obtained from third parties who had imported them into
the U.S.
Amazon.com Inc., Target Corp., Google Inc., eBay and various
retailing groups filed briefs supporting Costco, warning that
Omega's position could threaten companies that resell foreign-made
goods and lead to higher prices for consumers. Retailers noted that
many products they sell are first produced and procured from
abroad.
The software, publishing, movie and music industries, seeking to
protect the strength of their own U.S. copyrights, filed legal
briefs supporting Omega in that case.
All nine justices are participating in the textbook case. Ebay
and a trade group of retailers again filed briefs with the Supreme
Court, urging the justices to hear the student's appeal.
The case is Kirtsaeng v. John Wiley & Sons, 11-697. Oral
arguments will take place in the fall.
-By Brent Kendall, Dow Jones Newswires; 202-862-9222; brent.kendall@dowjones.com
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