If you’re a regular reader of our newsletter, you may recall in 2011 our writing about Supap Kirtsaeng’s legal problems when he was sued by John Wiley & Sons, Inc. (“Wiley”) for selling text books on e-bay.¬† Kirtsaeng, a Thai national, opened a used textbook business in 2009 to support his educational studies in the United States.¬† He enlisted his friends and family in Asia to buy textbooks and ship them to him in the United States for resale on e-Bay.¬† Kirtsaeng was later sued by Wiley – the copyright owner – in federal court for copyright infringement.¬† Wiley based its lawsuit on Section 109(a) of the Copyright Act, which prohibits the importation of copyrighted works created outside of the United States without the authorization of the copyright holder. The language of Section 109(a) is important.¬† It provides that:
the owner of a particular copy … lawfully made under this title, or any person authorized by such owner, is entitled, without the authority of the copyright owner, to sell or otherwise dispose of the possession of that copy . . . .
The first sale doctrine permits owners of copyrighted works, even if they are not the creators, to resell copyrighted works without fear of lawsuit by the creators.¬† Copyright owners, such as Wiley, argue that the “lawfully made” language, quoted above, only applies to works that are manufactured in the United States.¬† Assuming that is correct, then the first sale doctrine would not apply to works manufactured outside of the country.¬† Therefore, Kirtsaeng’s importing and reselling of foreign purchased textbooks would not be exempted by the first sale doctrine.
At trial, the federal district court prohibited Kirtsaeng from raising the first sale doctrine as a defense to copyright infringement and as a result, the jury found in favor of Wiley and awarded it damages for intentional copyright infringement.¬† Since our newsletter was published, the Court of Appeals for the Second Circuit affirmed the lower court, concluding that ¬ß109(a)’s “lawfully made under this title” language indicated that the “first sale” doctrine does not apply to copies of American copyrighted works manufactured abroad.
Kirtsaeng did not take “no” for an answer and appealed the Circuit Court’s decision to the United States Supreme Court, which issued its opinion on March 19, 2013.¬† The Court reversed, holding that the¬† first sale doctrine applied to any work whether it is published in the United States or abroad. The¬† Court’s opinion was based largely on statutory interpretation.¬† Here are the highlights:
- Section 109(a) says nothing about geography, the lower courts’ reading “bristles with linguistic difficulties”;
- Historical and statutory context indicate that Congress did not have geography in mind when it drafted the current statute;
- The common law “first sale” doctrine did not embrace a geographical component and, therefore, one must assume that the statutory version retained the common law given no evidence to the contrary;
- imposing a geographical component to Section 109 would not further the constitution directive of “promot[ing] the Progress of Science and the Arts;”
Justice Breyer delivered the opinion of the Court.¬† If you would like to read the entire opinion, click here.
– Adam G. Garson, Esq.