The United States Supreme Court is today hearing the case of Kirtsaeng v. John Wiley & Sons. This is a fantastic copyright case that asks the Supreme Court to interpret what appears to be two contradictory provisions of the US copyright law. The bottom line issue is whether so-called “gray market” imports of literary works printed (or otherwise made) and acquired outside the United States are allowed under US copyright law.
In the case, a Thai man financed his US college and graduate school education by importing textbooks into the US and selling them to US students. The books had been printed outside the US and legitimately purchased by the man’s family in Thailand. Because textbook publishers sell their books at a lower cost outside the US than they do to students here, the man was able to successfully compete with the publishers and make a profit of about $100,000 over a course of years.
The lower courts did not allow the Thai student to make a first sale defense at trial. They ruled that, notwithstanding the first sale doctrine, any importation of a work made and acquired outside the US requires the permission of the work’s owner.
At issue is which of two provisions of the US copyright law trumps the other. Section 109(a), which is a codification of the first sale doctrine, states that an owner of a particular copy of a work lawfully made under US law is authorized to further distribute that work without the permission of the copyright owner. Section 602(a)(1)2 states that importation into the US of a work acquired outside the US requires permission of the work’s owner.
17 U.S.C. § 109(a) provides in pertinent part:
Notwithstanding the provisions of section 106(3), the owner of a particular copy or phonorecord lawfully made under this title, or any person authorized by such owner, is entitled, without the authority of the copyright owner, to sell or otherwise dispose of the possession of that copy or phonorecord.
17 U.S.C. § 602(a)(1)2 provides in pertinent part:
Importation into the United States, without the authority of the owner of copyright under this title, of copies or phonorecords of a work that have been acquired outside the United States is an infringement of the exclusive right to distribute copies or phonorecords under section 106, actionable under section 501.
The crux of the case is the meaning of the words “lawfully made under this title,” as used in Section 109(a).
The case is interesting for three reasons. First, this issue of law was raised in a previous case, Costco Wholesale Corp. v. Omega S.A., 130 S. Ct. 2089 (2010), in which the Supreme Court tied 4-4 (Elena Kagan did not sit for the case). So the Supreme Court is essentially trying it again. Second, this is an instance in which the words of the copyright law seem truly truly ambiguous. And despite all the policy arguments made by the parties in their papers, the role of the court is really just to make sense out of the words of a statute. Third, the decision may have widespread effect on the way that products, and not just what you would think of as literary products, are distributed into the US from abroad. Very large multinational corporations are lined up on both sides of the case.
10/31/12: Here’s a summary of the oral argument posted at SCOTUS.