You Bought It, You Own It: Supreme Court Victory for Common Sense and Owners' Rights

In a long-anticipated decision, the Supreme Court held today that the first sale doctrine applies to works made outside of the United States. In other words, if you bought it, you own it—no matter where it was manufactured. That's a major victory for consumers, and also libraries, used bookstores, and all kinds of groups that depend on the right to lend or resell the goods they've legally purchased.

This case, Kirtsaeng v. Wiley, specifically concerned the re-sale of textbooks in the U.S. The first sale doctrine, described in section 109 of the U.S. Copyright Act, gives people the right to resell, lend, or give away the works that they’ve bought, even if those works contain copyrighted elements. Textbook publisher Wiley claimed that this doctrine only applies to goods that are manufactured in the U.S., and that the defendant, Supap Kirtsaeng, was infringing its copyright by purchasing books at a reduced rate in his native Thailand and selling them below list price in the States.

In other words, under Wiley's interpretation, copyright owners that are crafty enough to outsource the actual manufacture of their works abroad could control the secondary market for copies of works that were manufactured abroad for the entire copyright term.

The Supreme Court firmly rejected that notion, which it called the “geographical interpretation.” Your right to resell, lend, or give away the works that you buy does not depend on whether you happen to buy them in the US, or in Amsterdam or anywhere else. Rather, it simply depends on whether the copyright owner authorized the manufacture of the copy.

The decision cites an amicus brief filed by EFF and Public Knowledge [pdf], among others, explaining that limiting first sale to works made in the United States would encourage at least two perverse outcomes: American consumers lose access to affordable used copies of products, and companies move American manufacturing and related jobs overseas. Congress could not have intended these results. What is worse, given that copyrighted works are embedded in all kinds of goods, from refrigerators to watches, the ramifications would reach well beyond the traditional book market. As the Court noted:

We [] doubt that Congress would have intended to create the practical copyright-related harms with which a geographical interpretation would threaten ordinary scholarly, artistic, commercial, and consumer activities.

The practical problems that petitioner and his amici have described are too serious, too extensive, and too likely to come about for us to dismiss them as insignificant—particularly in light of the ever­growing importance of foreign trade to America.

The Supreme Court’s decision recognizes that copyright is supposed to serve the public interest, not the other way around. And as we've said before, giving rightsholders overly broad and restrictive enforcement powers is harmful to that public interest, even if those rightsholders aren't actively abusing them:

a copyright law that can work in practice only if unenforced is not a sound copyright law. It is a law that would create uncertainty, would bring about selective enforcement, and, if widely unenforced, would breed disrespect for copyright law itself.

Quite right.

The Court’s decision reflects a real common sense approach to copyright law. That approach will be needed if, as seems increasingly likely, we see a serious effort towards copyright reform. Whether the goal is fixing the Digital Millennium Copyright Act, making the world safe for hostage works, or bring a sense of rationality and proportion to statutory damages, the focus should stay firmly on preserving (or restoring) a sensible balance between the rights of authors, secondary users, and the general public.