Supreme Court Delivers Blow to Copyright Control


The Supreme Court, in a 6-3 ruling with a rather unusual lineup, delivered a major blow to publishing companies by upholding the right of a person to buy textbooks overseas at much lower prices and sell them at a profit. The case involved someone who found the same textbooks that sell for over a hundred dollars in the US available in Thailand at a far lower price, so he had relatives buy up the cheap books and sold them for a tidy profit here.

The lineup, as I said, was highly unusual. Justice Breyer wrote the majority opinion, joined by Justices Sotomayor, Breyer, Alito, Roberts and Thomas; Justices Scalia, Kennedy and Ginsburg were in dissent. SCOTUSblog has an analysis of the ruling:

For a topic that has divided the Justices so evenly for so many years, the vigorous and uncompromising tone of Breyer’s opinion is surprising. In his view, for example, the language of the statute is quite clear, largely because the geographical argument has no answer to the problem that “neither ‘under’ nor any other word in the [statutory] phrase means ‘where.’” He also emphasized the prior version of the statute, which extended first-sale protection to any copy “lawfully obtained.” Because nobody argues that the older version was geographically limited, accepting the publisher’s view required the conclusion that Congress’s revision of copyright law in the 1970s was intended to sharply limit the first-sale doctrine. He also included a substantial section in the opinion contending that the doctrine’s historical roots (dating back to Lord Coke) counsel in favor of a broad reading.

At the oral argument, the Justices (especially Justice Breyer) seemed particularly concerned about what Justice Breyer called a parade of “horribles” that would ensue from adoption of the publishers’ point of view. So if that concern in fact swayed the votes of the central Justices, it should be no surprise that it got extended treatment in Justice Breyer’s opinion for the Court. Among other things, he noted the absurdity of thinking that libraries must obtain licenses to allow the lending of books printed overseas, that owners of foreign-manufactured telephones, laptops, and tablets must obtain consent from software publishers to resell them, or that museums that own paintings of foreign artists need the consent of the artists to display the paintings publicly.

The bottom line is that if you buy something that is protected by copyright, you can do with it as you please, including reselling it if you wish — and it doesn’t matter what country you bought it in.

Comments

  1. The Lorax says

    If you weren’t allowed to re-sell something that’s protected by a copyright that you legally purchased, Ebay, pawn shops, and yard sales would be history.

    … I think I’m slightly worried that three people didn’t agree with this reasoning.

  2. says

    Unless the copies were pirated, I don’t see how the publisher could claim they weren’t “lawfully obtained” just because they were purchased in a foreign country. Wiley clearly authorized their sale in Thailand and made their money from the initial sale. Students resell used books every semester. This shouldn’t be any different.

    The student was clearly showing the entrepeneural spirit that conservatives claim to admire. I’m surprised Scalia ruled against him.

    On wait, he was cutting into the corporations god-given right to make huge profits. Now it makes sense.

  3. iangould says

    Of course, the main practical effect will likely be an increase in overseas pric
    es not a decrease in US prices.

  4. says

    I’m wondering how, considering the first-sale precedent, anyone could have ruled otherwise. It’s pretty well established that you can do as you will with your particular copy of a copyrighted work so long as you don’t make unauthorized copies. I’ll have to read the dissent later.

  5. Pierce R. Butler says

    Justice Breyer wrote the majority opinion, joined by Justices Sotomayor, Breyer, Alito, Roberts and Thomas; Justices Scalia, Kennedy and Ginsburg were in dissent.

    Uh, did Kagan change her name to Breyer just to monkey with bloggers?

  6. says

    I used to buy textbooks in Taiwan dirt cheap (as in about $5 vice $200). But they literally limited you to one-per-customer (of a given title), stamped it “not for resale”, and made you write your name in it using a permanent marker. Still, it was an infringement and unethical.

    I do remember bringing back a Taiwanese version of Cheng and Li Gauge Theory of elementary particle physics, then taking the course that required the book from one of the author’s (Li) who could hardly complain–he had a bookcase of Taiwanese copies.

    I think this has been mostly eliminated in Taiwan since the last time I was there.

  7. says

    Initial gut reaction: I’m glad someone finally decided to stick it to those textbook publishers. They’ve been cashing in on their captive audiences for too long, and anything that chips away at their ability to do that is a good thing.

  8. left0ver1under says

    The issue of textbook pricing is exactly like that of music and movies: people are pirating or buying through cheaper avenues because the companies that make them are overcharging and guilty of price gouging. Thirty years on, the far right still love to talk about “voodoo economics”, yet blissfully ignore the fact that “voodoo economic” is driving piracy. If companies stopped ripping off customers, the customers would stop ripping them off and be willing to pay (e.g. Baen Books, “humble bundle”). If companies want to end “consumer piracy”, they need to end their own piracy.

    http://www.swinburne.edu.au/chancellery/mediacentre/media-centre/news/2011/03/price-drives-global-media-piracy

    Price ‘drives global media piracy’

    Date posted: Monday 21 Mar 2011

    Fines and tougher laws are likely to have little impact on the worldwide growth in piracy of movies, music, books and software, copyright experts have warned.

    Media Piracy in Emerging Economies, the world’s first study on piracy from a developing-world perspective, shows that the ‘recipe’ for global media piracy is high prices for media goods….

    […]

    Based on three years of studying pirate networks in India, China, Brazil, Bolivia, Mexico and Russia, the report argues that global anti-piracy enforcement has largely failed and that the main problem in these countries is the lack of affordable media in legal markets.

    Living outside of Canada, I’ve come across this a lot. Companies will not sell and/or ship across borders any ebooks, CDs, DVDs, software, or electronic games (i.e. joysticks that plug into TVs). Retailers have claimed (probably true) that doing so constitutes a violation of some export agreement. On vacations in various countries, I’ve bought such things and taken them out of one country and into another without a problem (e.g. I buy legal VCDs of movies for US$4-8, software priced for third world countries). I’ve also had no trouble with friends buying and shipping items to me from North America.

  9. says

    Raging Bee,

    Initial gut reaction: I’m glad someone finally decided to stick it to those textbook publishers. They’ve been cashing in on their captive audiences for too long, and anything that chips away at their ability to do that is a good thing.

    Understood, but this is the wrong way to go about it. The best way to stick it to ‘em is with open source textbooks. There is some movement in that direction.

    Intro courses are easy. When I teach an intro course, I tell students: use any introductory physics book you can get your hands on. Use your grandmother’s physics book. They are more or less all the same.

    The publishers are trying to get around these measures by bundling the textbook with convenient online homework, course portals, etc.

  10. says

    I’ve gotten into a few rants with my brother about videogames in similar lines. The industry is moving towards download-only games without a physical component. If I buy a game disc and get tired of the game, I can give it to a friend, trade it in at a used game store, or even sell it to get back some of the money I spent on it. Someone else gets to play the game without sending money to the manufacturer. If I download a game from a network, I can’t just hand it over to a friend when I’m done with it. What I purchased was a license tied to my account. If my friend wants the game, he has to pay Sony to download it.

  11. slc1 says

    Publishers get around the purchase of used textbooks by bringing out new additions every couple of years.

  12. unbound says

    The publishers were only trying to go down the same route as the drug industries; such as curtailing people going to Canada for drugs and reselling of drugs (e.g. pet medications) from other countries. I used to be able to get Frontline on e-bay for dirt cheap where the seller was getting it from another country. I think the drug companies got away with their restrictions by claiming quality control (which is total BS).

    Maybe the publishers need to go that route. Claim that the books do not have the same level of quality control…it would be just as truthful as the drug company BS.

  13. pacal says

    I’ve read the dissent and it is pathetic. At the end it even talks about US foreign policy goals will be damaged if books marketed cheaper in the third world can be shipped to the US and sold cheaply. Just why the justices should be thinking of that is beyond me.

    And a lot of the dissent is sematic sophistry about what “under” means. And beneath all the words the dissent does indeed seem to be arguing that the text book manufacturers are entitled to a captive market in the US. The airy one line dismissal of the “horribles” as “imaginary” at the beginning is not impressive.

    I am not impressed with the acceptance of a dictum as settled law by the dissent. In fact it looks very much like the Supreme Court and the lower courts were basically trying to protect a closed market.

  14. anubisprime says

    The Texas school boards that love ‘em some cretinist balderdash might be a tad grumpy at this news!

    Cheaper Text books from elsewhere might persuade other states to buy out of country rather then going cap in hand to Texas and their felonious rigmarole, especially seeing that some states have a little more integrity and finances and budgets being as contentious as they are these days!

    Jus’ sayin’

  15. fastlane says

    Justice Breyer wrote the majority opinion, joined by Justice Thomas; Justice Scalia, in dissent.

    But but but…Thomas is Scalia’s lapdog…. [/stoopid] Another data point to refute this common meme.

  16. Gvlgeologist, FCD says

    OP:

    The bottom line is that if you buy something that is protected by copyright, you can do with it as you please, including reselling it if you wish — and it doesn’t matter what country you bought it in.

    This should affect a lot of faculty who sell the textbooks that publishers send them in hopes of getting the faculty to require the publisher’s text.

    slc1:

    Publishers get around the purchase of used textbooks by bringing out new additions every couple of years.

    Faculty get around that by allowing older editions. I allow any of the latest 3 editions, as the science (at intro levels) doesn’t usually change much in a 6 year (or so) interval.

  17. says

    I wonder if this ruling has any consequences for the legality of region-protection systems, like the region-protection on DVDs and games that make it impossible to play legally obtained discs on your device if those discs came from another region.

  18. zmidponk says

    Bronze Dog:

    I’ve gotten into a few rants with my brother about videogames in similar lines. The industry is moving towards download-only games without a physical component. If I buy a game disc and get tired of the game, I can give it to a friend, trade it in at a used game store, or even sell it to get back some of the money I spent on it. Someone else gets to play the game without sending money to the manufacturer. If I download a game from a network, I can’t just hand it over to a friend when I’m done with it. What I purchased was a license tied to my account. If my friend wants the game, he has to pay Sony to download it.

    Well, I don’t know if there’s been anything similar in the US, but, back in July, the Court of Justice of the European Union handed down a decision that, legally speaking, in that regard, digital copies are no different from copies on disc:

    curia.europa.eu/jcms/upload/docs/application/pdf/2012-07/cp120094en.pdf

    Of course, there’s still the little problem that, as of yet, it’s still not actually physically possible if it’s a digital copy of something tied into a service like Valve’s Steam or EA’s Origin (though there has been rumours that Steam will introduce this, at some point), but at least there’s no legal barrier, in the EU.

  19. says

    I’m stunned that this even made it to court in the first place, much less getting as far as SCOTUS. All Kirtsaeng was doing was grey-marketing the books, nothing more, nothing less, and I don’t think there has ever actually been a legal problem with grey market goods.

    So… any Australian readers want me to pick up a copy of Adobe CS6 at my local Staples and ship it to them?

  20. says

    @Deen: Thsi would in no way imply that region lock-outs are illegals, just that it’s legal to import region-locked discs and players from other regions. The movie industry has never made a fuss about this, figuring the need to have multiple players, some with voltage converters, will keep the import market limited. I think there have been attempts to shut down multi-region players, but they never went anywhere.

  21. lsamaknight says

    Ace @ 20

    There was a court case in Australia a few years back where Sony tried to shut down a guy who was modding PS2s to get around the region-lock on their DVD player on the grounds that it also bypassed their anti-piracy measures. The ruling came back that region-locking was equivalent to market fixing and that after-market mods to bypass it were perfectly legal. The fact that it also bypassed anti-piracy measures was Sony’s own dumb fault for making it so that you couldn’t bypass one without bypassing the other.

    Ironically enough these days Sony DVD players are some of the most likely to be multi-region out of the box. Blu-Ray not so much, though there are couple of brands where it’s a simple case of entering a code and changing it in the menu and they actually tell you how to do so in the manual. I suspect this is because there is no Blu-Ray equivalent to Region 0

  22. baal says

    I’m glad this ruling came out the way it did. The market protection forces in the us (big industry) has been very successful for the last 30 years in locking down gray market goods under expanded IP concepts. By supporting the first sale doctrine, there is some hope of citing this case against other protectionist policies.

    ” I think the drug companies got away with their restrictions by claiming quality control (which is total BS).”

    Yeah, this has been a bug up my butt for a while. In many cases Pharma was arguing poor QC at the very same time for the very same manufacturing plants it’s member companies were using in India and China. It was ok for them to buy from those drug makers but not us citizens.

  23. says

    Heddle:

    Open source textbooks are great, I won’t argue that point. But there are limits — look at CK12.org’s American history textbook. It ends at 1923, because of the difficulty of finding public domain sources after that point. It’s a lot easier to write FOSS books for STEM subjects because that kind of information either isn’t copyrighted or is readily available under FOSS licenses; however, with humanities subjects, you have news stories, novels, lit crit papers, all kinds of things that are usually under traditional copyright. FOSS is therefore only a partial solution, of course; you’ll be hard pressed to find US history textbooks in Thailand. But you get my general point here.

    Besides, I used to work in a bookstore in Boston. There’s no better way to understand how textbook publishers screw over their audience when they come in looking for a book and you tell them that a) it will take 6-8 weeks to get here and b) you can’t quote them a price because there’s three different prices in three different databases, all of which are obscene.

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