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Student Charged For Re-selling Textbooks

AstroPhilosopher writes "The U.S. Supreme Court will hear an appeal from a Thai student who was fined $600,000 for re-selling textbooks. Trying to make ends meet, the student had family members in Thailand mail him textbooks that were made and purchased abroad, which he then resold in the U.S. It's a method many retailers practice every day. 'Discount sellers like Costco and Target and Internet giants eBay and Amazon help form an estimated $63 billion annual market for goods that are purchased abroad, then imported and resold without the permission of the manufacturer. The U.S.-based sellers, and consumers, benefit from the common practice of manufacturers to price items more cheaply abroad than in the United States. This phenomenon is sometimes called a parallel market or grey market.'"

23 of 489 comments (clear)

  1. it's also called price discrimination.. by gl4ss · · Score: 5, Insightful

    ..in which you decide how much the product costs not based on how much the product costs to make, but on how much money the potential buyer has. parallel or gray market is just a term the content holders would like to use, since it doesn't make them look like asshats. http://en.wikipedia.org/wiki/Price_discrimination

    it's bullshit, of course. too bad for the publishers that books don't come with drm chips.

    (I'm assuming that in this case the books were original - as in printed with copyright holders permission).

    --
    world was created 5 seconds before this post as it is.
  2. I don't understand by Dog-Cow · · Score: 5, Insightful

    I fail to understand how the first-sale doctrine does not apply just because the first sale was outside the US. I would understand completely if ICE was coming after him for not paying duties or tariffs, but what does copyright have to do with anything here? He didn't make copies. He simply resold books the publisher was already paid for.

    1. Re:I don't understand by BitterOak · · Score: 5, Informative

      I fail to understand how the first-sale doctrine does not apply just because the first sale was outside the US. I would understand completely if ICE was coming after him for not paying duties or tariffs, but what does copyright have to do with anything here? He didn't make copies. He simply resold books the publisher was already paid for.

      The First Sale Doctrine doesn't apply to copyrighted good manufactured outside the U.S. The relevant case law is Pearson v. Liu, decided in the district court of the Southern District of New York. The case was appealed to the 2nd circuit court of appeals which affirmed the lower court's decision. The case was appealed to the Supreme Court which denied to hear the case, letting the decision of the 2nd Circuit Court of Appeals to stand.

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    2. Re:I don't understand by BitterOak · · Score: 5, Informative

      Apologies for replying to my own post, but I must make a correction. The link I provided was not for the Pearson v Liu case, but rather for the current case mentioned in the article. I was therefore in error in stating that the Supreme Court allowed that ruling to stand. The more relevant case, as it has already reached the Supreme Court is Omega v Costco, a 9th Circuit Court opinion which held the same thing: the First Sale Doctrine does NOT apply to copyrighted goods manufactured abroad. This opinion was appealed to the Supreme Court, but Justice Kagan recused herself, as she had previously argued the case for the government. The result was a 4-4 decision, which meant that the 9th Circuit decision stood, but it doesn't set a national precedent. This present case might well settle that precedent once and for all.

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      If I can be modded down for being a troll, can I be modded up for being an orc, or a balrog?
  3. Re:College now days is more about profit now days by Anonymous Coward · · Score: 5, Funny

    Normally I'm not a grammar Nazi, and I'm sure someone could find some fault in this post too. That said, based on your writing ability, it's not easy to accept your advice on the value of a college education.

  4. Re:I Don't See the Parallelism Here ... by Anonymous Coward · · Score: 5, Interesting

    I bought the (official) International Students Edition of a well-known electronics book (in the UK, delivered from America). The paper is a bit rougher and thinner and the two-tone graphics were greyscale, and the binding was a bit flimsier, but everything was the same. If anything, it was more useful as it was lighter than the alternative solid slab of glossy paper, and smelled much nicer! All in all, it cost me about a third of the cost of the book in the UK, including shipping from the States. I wasn't about to pay three times the price so I can have unecessary colour in my textbook!

    What did interest me was a bit white box on the cover saying "this book is for sale only in India, Pakistan, Bangladesh and Myanmar". Seems the DVD-style region codes extend to books as well. Whatever happened to the global market?

    On the other hand, my cunningly acquired early edition of a maths textbook were printed in the days when the answer to a log question started with "from your tables". But it still had the right answers and all the material I needed. A set of Stroud for under £10 is worth it even just for the doorstop capability.

  5. Control, Control, Control by RobinEggs · · Score: 5, Informative

    Every level of the textbook business is about manipulation, lies, and control, from the publisher to the campus bookstore.

    I researched the actual cost of textbooks once, and found industry websites with cost breakdowns which swore, up and down, that the profit margin on textbooks was 1%. I shit you not. You buy the 13th edition of your text for a retail price of $298, a book that's been out for 15 years and hundreds of printings, and they expect you to believe that even *now*, on the 13th edition, the publisher made well under $3 per copy.

    On the retail side, I worked for a campus bookstore and my wife was their night manager. After they let me off for total lack of available work, I decided to just sell them books I found on ebay and bought from other students. After I sold them several dozen they fired my wife and banned me from the store based on their unwritten and inconsistently enforced policy that a student can sell only one copy of a particular title to them. Why do they care? I have no idea. The only time I sold them books was the two week period after spring semester buyback but before summer classes; I gave them more copies of these books, at prices and quantities they set, during a period when their used stock was already at it's yearly maximum but still not high enough for their liking. There were no other copies for them to acquire from students, and awful NC state laws forbid them from acquiring more used copies on Amazon, eBay, etc. For this they treated me like a criminal, fired my wife, and even made allusions to whether we'd stolen the books despite the fact that there are cameras, audits, and never less than 3 people at the registers.

    It was all about control; what I did was good for their business, and they didn't give a shit. I was making money in a place they thought only they were allowed to make money. Even though it made them even more money than it made me, they hated me for it and considered it abusive.

    Control, control, control.

  6. Re:I Don't See the Parallelism Here ... by ultranova · · Score: 5, Insightful

    I have every right as a free citizen (not a megacorp slave) to buy the cheapest copy I can find. It's called free trade.

    It's only called free trade if it benefits the Megacorp. If it benefits a mere mortal, it's called infringement. What it actually infringes isn't quite clear, since you aren't actually copying anything, but that's unimportant. What's important is that the Megacorp paid good money to have the laws written and interpreted for its favour.

    --

    Forget magic. Any technology distinguishable from divine power is insufficiently advanced.

  7. Re:Silly. by jandrese · · Score: 5, Informative

    Often times the differences between versions is that the questions at the end of the chapter will just be reordered and maybe a couple of minor tweaks here and there in the text. The versioning is really just a racket to try to shut down the used book market. I've had teachers that support multiple versions of a book by simply handing out problems like so:

    Questions 2, 5, 8, 11, and 19 for version 5 owners, 5, 8, 9, 13, and 14 for version 6 owners. Since the rest of the content was the same this was basically no extra work on their part, since they had to go through and pick the new questions when the new version came out anyway, so they just picked the same ones as the previous year's. The textbook industry is such a racket.

    --

    I read the internet for the articles.
  8. Globalisation is for corporates by Alain+Williams · · Score: 5, Interesting

    Silly man, he did not understand that globalisation is for corporates to exploit, it is not for individuals to benefit from.

    Companies do this all the time: buy goods or get them made where ever in the world it is cheapest for them to do so. They then sell them at different prices in different countries: price it too high in India and you don't get sales, price it too low in Europe and you loose potential profit.

    They can't possibly have customers doing the same thing - it would damage their profits and the CEO's bonus would have to be cut. So they adopt all manner of tactics to stop us from benefiting from globalisation in the way that they do: * region coding on DVDs, * refusal to service equipment if imported (even if identical ones are sold in the country), sue non approved importers, ... All designed to distort the free market

    I would mind paying more for something that I buy in England if it were made with English labour paid English wages. What I object to is them paying third world people slave rates and charging me top dollar - I don't like the hypocrisy of it all.

  9. Re:I Don't See the Parallelism Here ... by Mordok-DestroyerOfWo · · Score: 5, Insightful

    So you are arguing that, as a free citizen, it is OK for you to purchased illegal copies of a book? Or are you arguing that no written material should be able to have copyright protections?

    Also, what does the size of the publishing company have to do with publishing/copying rights?

    Is it his responsibility to know that it is illegal? And more to the point, by which basis are they illegal? I buy Book A from the campus bookstore, and I buy Book B from an overseas distributor for a fraction of the cost. A is identical to B. I understand that it is illegal, but purchasing books in this way is in no way unethical and to my (admittedly unlawyer-like mind) is far more important.

    --
    "Never let your sense of morals prevent you from doing what is right" - Salvor Hardin
  10. Re:Uh, Have You Heard of Distribution Channels? by secret_squirrel_99 · · Score: 5, Insightful

    there are distribution channels and contracts that prevent someone in

    This isn't a contractual issue. This is a copyright issue. No one is claiming breach of contract. Furthermore, the defendant in this case never entered into any sort of contract with the publisher. He purchased books on the open market and resold them on the open market. The plaintiffs are claiming copyright infringement. This should be a clear cut example of the first sale doctrine, and should have never gotten beyond a district court.

    --
    If privacy had a tombstone it would read "We did it for your own good" . -- John Twelve Hawks
  11. WTF? by fuzznutz · · Score: 5, Insightful

    These are copies of a book *LEGALLY* published and sold by the Asian subsidiaries of US publishing houses. How the f*ck are they illegal? The question is whether or not copyright law can restrict if they can be imported and resold.

    Oops, sorry. I fed the troll, didn't I?

  12. Re:I Give Up by Mashiki · · Score: 5, Insightful

    Good luck upsetting the publishing business with your brilliant views! Burst forth, you need only say these words and hundreds of years of international copyright law will crumble!

    One can only hope. The books are the same, we know we're paying over, way and above what the textbooks can be covered for. We end up having to pay for 'minor' revisions to keep concurrent or fail classes. When I was working my way through my law classes a few years ago, the textbooks alone set me back nearly $4000. Though I could buy them out of country, with the same content for $250.

    People understand very well how the world works. What you fail to understand is that people are tired of DRM, region locking, overpriced for the same material you can get elsewhere especially in a global economy where you can order something from across the ocean and pay 7/8th's less on the price. So when people want something, they find someplace cheaper to buy it.

    Hey are you gonna blast canadians next for buying american products cheaper across the border too? With regards to just about everything? I mean a gallon of milk and butter are in the $4-6 range, sure would be nice to have it like the US where it costs $1.99 or less, flat of eggs only $5 or $1.50 in the US. Or americans buying canadian drugs at a cheaper price when they know that they only have to travel a few hours to get there?

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    Om, nomnomnom...
  13. Re:I Give Up by thoth · · Score: 5, Insightful

    I get what you're saying about the legalities, but this really isn't a copyright issue, is it? This kid isn't attempting to publish the books or claim authorship, he's reselling. If he worked at Goldman Sachs and were buying pork bellies or oil in one market and reselling in another, that would be called "arbitrage". Of course, Goldman Sachs is wealthy enough to afford lawyers to tell others to f*ck off, or pay for favorable legal rulings (or laws themselves, or even politicians).

    Sorry, but fundamentally Megacorp(s) don't get to have all the advantages and benefits of free trade (outsourcing production to where their costs are low), and none of the disadvantages and drawbacks. At least, not in a fair world and not in a "free market". I remember a "free market" existing when producers and consumers get choices, not when the producer gets the government to clamp down on imports so the local market is captive, all the while outsourcing production and booking profits through offshore shell corporations.

  14. Re:Uh, Have You Heard of Distribution Channels? by sjames · · Score: 5, Interesting

    The contracts apply to the seller in New Delhi. They do NOT apply to a 3rd party that buys from them and then re-imports to the U.S.

    As for the rest, if the corporations have the right to take advantage of economy mis-matches to funnel U.S. jobs to cheap overseas labor, then surely the People in the U.S. have just as much right to take advantages of economy mis-matches to funnel sales to cheap overseas sellers. Or are they expected to somehow keep paying 1st world prices when their wages are becoming more 3rd world like by the day?

  15. Re:Allow Me to Rephrase the Problem by JDG1980 · · Score: 5, Insightful

    Let's say Addison Wesley publishes a text book on Modern Evolution and it runs you a steep $90 here in the United States. Unsurprisingly, as the gatekeepers of that copyright, some of us actually shell that out. Well, universities in India are going to want access to this same material but there's a problem and I think you know what it is. That much money means a lot more in India than it does in the United States. So we have publishers wanting to sell textbooks in India to college students but the most anybody can really afford is $9. What's worse, if they don't release a version at that price, they're just going to bootleg it anyway. So the solution is to engage in, as you put it, "price discrimination" or as I might call it distribution values based on localized income since they want to make these materials available but they want to also make a profit in first world countries.

    You've explained why this is a dilemma for publishers. What you haven't explained is why anyone outside the publishing industry should give a crap about their business model.

    You do not have a right to make a profit in business. Just because someone is doing something that makes it harder for your business to be profitable doesn't mean that it is, or should be, illegal. And rest assured that if the shoe was on the other foot, the publishing companies would have no compunction about eating someone else's financial lunch.

  16. Re:I Don't See the Parallelism Here ... by camperdave · · Score: 5, Informative
    You are missing Title 17, Section 602 of the American copyright law:

    602. Infringing importation of copies or phonorecords (a) 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 [17 USC 106], actionable under section 501 [17 USC 501].

    The law specifically forbids this practice.

    --
    When our name is on the back of your car, we're behind you all the way!
  17. Re:I Give Up by trout007 · · Score: 5, Interesting

    Other forms of slavery were toppled by people comming to their senses. The fall of intellectual property will be the same.

    --
    I love Jesus, except for his foreign policy.
  18. Re:I Give Up by Anonymous Coward · · Score: 5, Interesting

    Good points.

    Its funny how U.S. companies can ship jobs overseas to purchase the cheapest workers, but the American worker has a hard time doing the same for products.

    I still don't understand how we put up with it.

  19. Re:I Give Up by russotto · · Score: 5, Insightful

    I get what you're saying about the legalities, but this really isn't a copyright issue, is it? This kid isn't attempting to publish the books or claim authorship, he's reselling.

    No, it's a copyright issue. The content industries (and the appeals court) take the position that while copyright protection applies across the entire Berne convention, that copyright exhaustion -- the idea that by selling a particular copy, the copyright holder no longer can control distribution of that particular copy -- applies on a country by country basis. And that therefore importing a copy of a copyrighted item without the permission of the copyright holder, even when that item was lawfully sold in the country of origin in the first place, is illegal.

    It's absolutely unjust and ridiculous (just like much of copyright law) -- which means the Supreme Court will probably support it.

  20. You already know the answer by Weaselmancer · · Score: 5, Funny

    I still don't understand how we put up with it.

    Because you have to. Because you can't afford your own lobbyist.

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    Weaselmancer
    rediculous.
  21. Re:I Give Up by bubblejet · · Score: 5, Informative

    The milk I buy in the supermarket in the US is also rbgh-free. It's required to come with a legal blurb saying that the FDA has not approved any benefit to hormone-free milk. Despite this, it's been years since I've seen a container of milk that doesn't claim to be free of synthetic hormones. (I live in the northeastern US)