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eBay frets as right to resell comes under scrutiny

US Supreme Court to examine first sale doctrine

Internet Security Threat Report 2014

eBay has launched a “grass roots” campaign to defend America’s first sale doctrine, as a Supreme Court hearing approaches that could subject second-hand and resale trades to the approval of rights-holders.

The online auctioneer is lobbying in defense of the first sale doctrine, and has launched “eBay Main Street” to mobilize its merchants.

The first sale doctrine – in essence, your right to sell your property – will be put under the spotlight in a case sparked by a student reselling textbooks bought outside the USA.

At issue is a decision by a lower court that as far as books are concerned, the doctrine only applies to copies made in America – a decision that forbids what Australians would recognize as parallel imports.

Rather than being confined to books, however, the Appeals Court ruling in the case of Kirtsaeng v. John Wiley & Sons soon to be examined by the Supreme Court covers all copyright works.

That’s raising concern far beyond the publishing industry: technology products, for example, contain copyright works in their software, raising fears that normal activities such as reselling technology products could become a nightmare of regulations.

The Kirtsaeng v. John Wiley & Sons case involved a complaint by the publisher that a Thai-born graduate studying in the USA, Supap Kirtsaeng, was buying textbooks overseas and selling them in America on eBay. John Wiley & Sons sued and won, with the Appeal Court limiting the first sale doctrine “specifically and exclusively” to works made in territories in which the US Copyright Act applies, not to “foreign-manufactured works”.

If that statement were upheld in the Supreme Court, it wouldn’t only affect the secondhand trade: Channelnomics articulates fears that the new doctrine would also be catastrophic for the conventional IT channel.

Amicus briefs are flying in all directions. Back in July, the Library Copyright Alliance filed a brief arguing that the Appeals Court finding puts the activities of lending libraries at risk. On the other side, the Association of American Publishers (AAP) and the Software and Information Industry Association have both filed in favour of the Appeals Court finding. ®

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