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The Kirtsaeng ruling: What’s your opinion?

This wasn't the outcome I was anticipating

Wow. I’m very surprised by the Supreme Court’s ruling in the Kirtsaeng vs. Wiley case. I figured it would go the other way. Here’s a nice summary of the majority opinion from the Supreme Court (you’ll find more detailed analysis here):

Putting section numbers to the side, we ask whether the “first sale” doctrine applies to protect a buyer or other lawful owner of a copy (of a copyrighted work) lawfully manufactured abroad. Can that buyer bring that copy into the United States (and sell it or give it away) without obtaining permission to do so from the copyright owner? Can, for example, someone who purchases, say at a used bookstore, a book printed abroad subsequently resell it without the copyright owner’s permission?

In our view, the answers to these questions are, yes. We hold that the “first sale” doctrine applies to copies of a copyrighted work lawfully made abroad.

So does this mean we’ll see more enterprising individuals buying low-priced textbooks overseas and reselling them here in the U.S.? Perhaps, but what really intrigues me is the question of first sale doctrine and the resale of digital goods.

That, of course, is at the heart of ReDigi‘s business model. You might be aware of the lawsuit ReDigi is fighting with Capitol Records. And yes, one key difference between this and Kirtsaeng is that the former has to do with licensing vs. ownership of digital goods while the latter is about the scope of first sale in physical goods. Nevertheless, the Kirtsaeng ruling can only help ReDigi’s case and that’s a good thing for anyone who wants the ability to resell their digital goods. ReDigi offers the resale of digital music today but they and other key players, Amazon and Apple, undoubtedly have ebook reselling on their radar for tomorrow.

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Update: I just spoke with ReDigi CEO John Ossenmacher and here’s what he had to say about the ruling:

We are pleased and excited to see such a solid and resounding victory for American consumers, businesses and charitable organizations.  All too often there are those who believe the sky is falling and become defensive and protectionist to a faulty end, we see instead a significant opportunity for ALL to prosper in the digital ecosystem more greatly than they ever thought possible. It is all a matter of perspective and moving to the future in a positive constructive way versus trying to fight the progress that will ultimately be determined to be right and just.

Justice Breyer delivered the opinion of the Court.  “Can that buyer bring that copy into the United States (and sell it or give it away) without obtaining permission to do so from the copyright owner?  Can, for example, someone who purchases, say at a used bookstore, a book printed abroad subsequently resell it without the copyright owner’s permission?  In our view, the answers to these questions are, yes.”

We could not agree more, thank you.

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So what’s your opinion on the Kirtsaeng ruling just handed down by the Supreme Court? Is this good for the industry?

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  • http://www.bradleyrobb.net/ P. Bradley Robb

    I haven’t had a chance to do much but skim the review, but the potential ripple effects of setting a bad precedent made me very, very glad the court ruled in favor of first sale.

    Now, hopefully this ruling puts to bed the nonsense introduced by Omega S.A. v Costco Wholesale Corp.

  • joanne

    Fabulous for consumers – if we buy it we should have the right to do with it what we want! Donate, gift it, resale it, or keep it. The producer of the goods got their money out of the original sale.

    It shouldn’t matter what the format of the good is; paperback, hardcover, digital – it is the same product; author, title, story, page numbers etc.

  • http://twitter.com/copyrightandtec Bill Rosenblatt

    I’m not sure how much the Kirtsaeng decision portends any Supreme Court position on digital first sale, i.e. the applicability of first sale to digital files such as e-books.

    The vast majority of the Kirtsaeng opinion dealt with the geographical issue — the tension between the first sale law and another law forbidding importation of foreign-made copyrighted works into the U.S. — and the linguistic interpretation of the words “lawfully made under this title” in the first sale law. There was some material in there about how burdensome it would be to libraries and museums if the decision went Wiley’s way. In contrast, there was nothing in there at all about the reseller (Kirtsaeng) having the right to make a profit from the price differential.

    This leads me to believe that libraries and museums — more than resellers — will have the major influence on any digital first sale question that gets to the Supreme Court. Put another way, I don’t think the Supreme Court is likely to be as interested in arguments that represent the question of digital first sale as a conflict between two industry factions, publishers and resellers.

  • http://robertcollings.com/ Robert Collings

    I had imagined first sale’s relevancy would have been to in-market acquisition and disposal rather than what, in some markets, is termed “parallel importation”. Whatever the case, it will soon be a curiosity of physical market segregation.