The Supreme Court May Make Resale Illegal
Case could shut down eBay, Overstock.com, others.
Web2Carz Senior Writer
Published: October 31st, 2012
Supporters of Wiley include software companies and book publishers, who say that being able to charge different prices in different markets is vital to their success.
case before the Supreme Court involving imported textbooks sold on eBay could have a significant impact on how goods are sold, and could put an end to all resale, including popular web sites like eBay and Overstock.com. The case under consideration is Wiley v. Kirtsaeng, in which textbook publisher John Wiley and Sons sued Supap Kirtsaeng over the business Kirtsaeng ran selling imported textbooks on eBay.
The reason this case could have such broad implications is that it involves one of the primary limitations on copyright protections. The "first sale" rule allows anyone who owns copyrighted goods (which includes not only media like books, DVD, and CDs, but anything sold under a brand name) to lend them, give them away, or resell them. The question the Supremes will be considering is whether the "first sale" rule also applies to goods that were made overseas.
On the one side of the case is John Wiley and Sons, whose supporters in this case include the entertainment industry, software companies, and book publishers. Basically anyone who sells copyrighted materials is on John Wiley's side, since being able to charge different prices in different markets (in other words, charging a premium for imported items), is vital to their success.
On the other side of the case are companies such as eBay, Amazon, Overstock.com, as well as libraries (since lending is covered under "first sale"), who fear that if the case is decided in John Wiley's favor, they will no longer be able to resell copyrighted goods.
Those siding with Wiley claim that such fears are overblown, but even Supreme Court Justice Anthony M. Kennedy has said that hypotheticals like shutting down eBay and other resale business will have to be considered when deciding this case.
This same issue has been considered by the Supremes previously, in Costco Wholesale Corp. v. Omega S.A., but Justice Elena Kagan recused herself from that case, and the remaining justices split 4-to-4.
The court has already heard arguments in Wiley v. Kirtsaeng, but their decision will not be announced until later this year.