The US Supreme Court will decide in Kirtsaeng v. John Wiley & Sons, Inc. if importing and re-selling copyrighted works originally intended only for sale in a foreign territory is protected by the “First Sale Doctrine” or constitutes copyright infringement.
If the importation of what are deemed “gray market goods” and their resale is protected by the “First Sale Doctrine,” book publishers, music owners, and other content owners argue the economic impact on the US market will be devastating. It will under-cut content owners’ ability to offer content for different price points in foreign countries, ie, books/music/films might be sold for a cheaper price in a foreign country than in the US.
Supap Kirtsaeng, a Thai national and former Cornell University student, had family members purchase authorized copies of textbooks in Thailand which he resold on eBay in the US for a profit. Evidence at trial suggests Kirtsaeng had a million dollar operation. John Wiley & Sons, Inc. sued Kirtsaeng for copyright infringement and won at trial and the Second Court of Appeals upheld a $600,000 damage award.
Kirtsaeng argues his actions were not copyright infringement but protected by the first sale doctrine which provides an individual who knowingly purchases a copy of a copyrighted work from the copyright holder receives the right to sell, display or otherwise dispose of that particular copy. See 17 U.S.C. § 109(a) & (c).
John Wiley & Sons argues unauthorized importation of the books constitutes copyright infringement in violation of the copyright owners’ distribution rights. See 17 U.S.C.§ 602(a)(1). Content owners argue such “gray market” goods or unauthorized imports are not lawfully made under the Copyright Act and the resale constitutes copyright infringement.
Music lawyer Tamera Bennett and film lawyer Gordon Firemark discussed the Kirtsaeng appellate court ruling on Episode 23 of the Entertainment Law Update podcast.