On March 19, 2013, the Supreme Court decided Kirtsaeng v. John Wiley & Sons, Inc., No. 11-697, holding that copyright law's "first sale" doctrine applies to copies of a copyrighted work lawfully made abroad.
Under the copyright law, a copyright owner's exclusive right to distribute the copyrighted work is limited by the "first sale" doctrine, which provides that "the owner of a particular copy…lawfully made under this title…is entitled, without the authority of the copyright owner, to sell or otherwise dispose of the possession of that copy." 17 U.S.C. § 109(a). The first sale doctrine explains, for example, why people can legally resell copyrighted CD collections on eBay. Before today's decision, however, it was unclear whether the doctrine applied to copyrighted items acquired outside the United States, because another section of the Copyright Act prohibits the importation of copyrighted works "into the United States, without the authority of the owner of copyright." § 602(a)(1).
Kirtsaeng arose when an enterprising student moved from Thailand to the United States and asked friends and family who had stayed in Thailand to buy English language text books there and send them to him in the United States for him to resell.
The lower courts both found Kirtsaeng liable for copyright infringement, but the Supreme Court reversed, holding that the first sale doctrine applies to copies of a copyrighted work lawfully made abroad.
"We must first decide," said the Court, "whether the words ‘lawfully made under this title' restrict the scope of § 109(a)'s ‘first sale' doctrine geographically." Turning first to text, the Court concluded that the word "under" means "in accordance with" and that "lawfully made under this title" simply means "lawfully made" under the standard of lawfulness set forth in the U.S. Copyright Act. The Court rejected the publisher's argument that "under this title" means "where the Copyright Act applies."
The Court then considered the historical and contemporary statutory context and held that Congress did not have geography in mind when writing § 109. The Court also applied the canon of statutory interpretation that "when a statute covers an issue previously governed by the common law," it is presumed that "Congress intended to retain the substance of the common law." The Court held that the common law's first sale doctrine had an impeccable pedigree yet made no geographical distinctions.
Finally, the Court noted that a geographical interpretation of the first sale doctrine would raise various practical problems for booksellers, libraries, museums and retailers, which have long relied on the first sale doctrine. For example, libraries would have to obtain permission before circulating books printed overseas. It rejected the publisher's argument that such problems have not occurred in the 30 years since a federal court first adopted a geographical interpretation. The Court held that the law was not nearly as settled as the publisher would have the Court believe and that the Second Circuit was the first court of appeals to adopt a purely geographical interpretation.
Justice Breyer delivered the opinion of the Court, in which Chief Justice Roberts, and Justices Thomas, Alito, Sotomayor and Kagan joined. Justice Kagan filed a concurring opinion, in which Justice Alito joined. Justice Ginsburg filed a dissenting opinion, in which Justice Kennedy joined and in which Justice Scalia joined in part.