The U.S. Supreme Court, in Kirtsaeng v. John Wiley & Sons, recently held that foreign-produced copies of works protected under U.S. copyright law are subject to the “first sale” doctrine. The doctrine, codified at Section 109 of the Copyright Act, gives the copyright owner the right to sell each copy of the work once, allowing for free transfer of that copy beyond the initial sale. The ruling is bad for U.S. publishers, who now have less control over distribution of their works. But what is the decision’s impact on entertainment law practitioners, if any?
Gordon Firemark, a Los Angeles entertainment attorney and blogger, notes concern from industry officials that the ruling makes it more difficult for U.S. businesses to compete abroad. On the other hand, others note that the decision will enable U.S. businesses to purchase goods abroad and resell them in the U.S., fostering a legal “grey market.” This blog posted previously on this case with excellent background on some of the competing interests.
Taking either perspective, the decision is good for consumers because it should result in cheaper goods. Also, the ruling forces U.S. companies to reconsider international price discrimination. And despite amicus briefs by the music industry, forecasting dire consequences if the court ruled as it did, at least some analysts don’t see such gloomy results from this decision. Finally, it’s important to mention that the Kirtsaeng decision applies only to authorized copies, i.e. ones pursuant to a license from the copyright owner.