Supreme Court To Decide Whether Or Not You Own What You Own
Jafafa Hots writes "The Supreme Court is set to decide, in the case of Kirtsaeng v. John Wiley & Sons, whether or not First Sale Doctrine applies to products made with parts sourced from outside the United States. If the Supreme Court upholds an appellate ruling, it would mean that the IP holders of anything you own that has been made in China, Japan or Europe, for example, would have to give you permission to sell it. Your old used CDs, cell phone, books, or that Ford truck with foreign parts? It may not be yours to sell unless you get explicit permission and presumably pay royalties. 'It would be absurd to say anything manufactured abroad can't be bought or sold here,' said Marvin Ammori, a First Amendment lawyer and Schwartz Fellow at the New American Foundation who specializes in technology issues."
It will provide a huge boost to US manufacturing jobs!
That would certainly deter me from buying products that were manufactured or contained parts that were manufactured abroad. People would be determined to buy domestic products (assuming they even exist these days). That said, it was clear that I could sell my car without permission when I bought it - changing the terms after the sale seems very wrong. If they implement this rule, they should specify that it applies to sales after a point in time in the future.
Almost any electronic device and all autos made after the 50s or 60s that has an imported part of some sort. Do we take it to the next level with minerals and metals imported too? I think this has about as much chance of standing as a two legged stool.
When something is sold, it is no longer the sellers, it's the buyers.
This rediculous IP notion has gotten out of hand.
It sounds like they are gouging the hell out of their US customers if this guy can buy the same book abroad, pay international shipping on it, probably import duties etc. and still make $1.2 million dollars. Instead we have another case where a "rights holder" is trying to assert insane terms on the rest of country to preserve their business model. Let us hope that the Supreme Court hears this on one of its "non-crazy" days.
It's not just a problem with electronics. I might have Chinese light fixtures, or Mexican light switches, plumbing etc. in my home. Will I have to get permission from 50 different companies before I can sell it?
Sorry, but gray text on gray background is making my eyes bleed.
I predict an obvious but subtle castigation of lower courts for it getting there at all.
But when did we lose common sense? Can't a corporation think it's way out of a wet paper sack?
Clearly the solution for them would be to raise prices abroad.
This parallels drug importing I suppose as well. Same solution imho.
Oh wait...nobody abroad would pay that much for a book? Then maybe you're gouging the US market and as a judge I'd say you've made your profit here via gouging and abroad by what you were willing to sell for under no choice but your own and what the market will bear.
Tough Shiite.
So if upheld then Apple (or indeed any American corporation that utilizes offshore manufacture of products of their own design) could forbid resale of their products so that you could only ever buy new from them.
Seems like a win for them.
Here is a website that tracks what products are still made in the US of A
They seem to be pretty good about differentiating between actually made and assembled. Now as far as raw materials are concerned or sub-assemblies, I don't know.
The Fuji vs. Jazz Camera, Lexmark vs. Arizona Cartridge Remanufacturers, and other cases have been rare examples of unanimous rulings by the Supreme Court vs. similar appellate court rulings on patent extension. I work in the re-manufacturing industry and am not too worried about the USA courts (though the Terminator-like persistence of foreign companies bringing the case that resale = patent or trademark infringement is frightening, and the Mickey Mouse rulings on Trademark are depressing). What's more troubling is the direction ownership law goes when the USA Supreme Court and European Courts no longer oversee 80% of all product sales. Chinese consumers purchase more computer products than the USA today, and if they take a Japanese turn in their court rulings, these corporations may become godlike, and the USA may be tempted to try to give our own companies (like Apple) similar power. See links to the cases above at http://retroworks.blogspot.com/2012/03/usas-finest-supreme-court-ruling-for.html
Gently reply
Before yesterday I would have nominated "PETA Condemns Pokemon For Promoting Animal Abuse" as the batshit crazy story of the year. Now I think it has competition.
I am Slashdot. Are you Slashdot as well?
The case is regarding items manufacturered in foreign countries and intended for sale in those countries. NOT items manufactured in foreign countries intended for sale in the United States. At issue is having someone buy things cheaper overseas and resell them cheaper here in the US than the manufacturers intended US price.
That's still horrible - but not nearly as bad as the article summary would have you believe.
The guy who's being brought to trial seems to have imported enough textbooks to earn $1.2 million. That means this isn't really a case about reselling your car, but about whether private citizens can buy a bunch of stuff abroad and re-sell it here for profit because it's cheaper abroad.
You can track the legislation here:
So having read the article, it doesn't say the same thing as the summary. To be fair, I haven't read any of the court paperwork, so the publisher could indeed be claiming that you cannot sell something with foreign parts.
This case, however, stems from a student buying textbooks at lower cost overseas and then selling them in the US on eBay.
I'm not saying it's good, right or proper that the publisher wishes to restrict these sales. I simply want to highlight that it's a very different proposition saying you cannot resell in the US a complete product purchased in a developing market where the manufacturer sells at a lower cost as opposed to being unable to sell anything that contains a foreign part.
I believe the situation the publisher supports is already the case in Europe, where Levi Strauss won a battle against supermarkets who were importing grey market denims and selling them at a lower cost than licensed distributors could buy the jeans in the UK.
Wouldn't this destroy Amazon and Ebay?
they sell an awful lot of second hand kit...
"Consider how lucky you are that life has been good to you so far. Alternatively, if life hasn't been good to you so far
From The Deathly Hallows by JKRowling:
"You don't understand, Harry, nobody could understand unless they have lived with the goblins. To a goblin, the rightful and true master of any object is its maker, not the purchaser. All goblin-made objects are, in goblin eyes, rightfully theirs."
"But if it was bought — "
" — then they would consider it rented by one who had paid the money. They have, however, great difficulty with the idea of goblin-made objects passing from wizard to wizard. [snip] I believe he thinks, as do the fiercest of his kind, that it ought to have been returned to the goblins once the original purchaser died. They consider our habit of keeping goblin-made objects, passing them from wizard to wizard without further payment, little more than theft."
sed -e 's/Chuck Norris/Rajnikant/g' joke > fact
What matters is where the authorized "first sale" occurred, not where it was manufactured.
So if a book publisher has books printed outside the US, then imports them and sells them retail for the first time in the US, you can freely resell it because the first sale occurred within the US.
What is being disputed in this court case is whether you can resell a copyrighted item in the US if the first sale occurred outside the US.
---------
There is inferior bacteria on the interior of your posterior.
Copyright law recognises that publishers may well want to publish the same item at a different price in another country. A textbook in the US or Europe can be sold at quite a high price. In poorer countries, there's no way they can sell for these markups, so they're a lot cheaper.
The law allows the copyright holder to licence distribution to another party for distribution in another territory. To prevent a companies own products from competing with their domestic sales, the law makes it an infringement of copyright to sell a copy licensed for sale in another country. Whether you think this is right or not, this is what the law recognises, and what the Supreme court will be basing its decision on.
Of course, the lawmakers don't want to prevent you from taking a book with you when you're travelling, nor do they think that you should buy an entire new library if you move to another country. So you're allowed to bring the foreign copy to your country if you have no intention of selling it.
So what happens if you change your mind? Do you have the right to sell something that you legally brought into the country? Is the "first sale" the first time the item was sold, or is it the first time the item is sold in the US?
The article is highly misleading. This has no effect on something that just happens to have been made in another country, as long as it was originally sold by the copyright holder. Only items where the item has not yet been sold in the US.
The 99% will not care, because they'll be too busy saying "well it doesn't hurt me directly, and therefore I don't care"
Actually, since it kills every thrift store, second-hand shop, pawn shop, etc. I'm pretty sure "the 99%" are going to notice the problem pretty damn quick.
This is messing with the capitalistic economic model people will still want those goods, and people will be willing to sell them, but they will do it over the black market. Because the legit way is too costly.
The black market isn't always for shady product, but products that you cannot obtain legally.
For example in New York the biggest Black Market Activity is in unpasteurized milk. Why because there is a good number of "organic" lovers who would rather have their milk unprocessed and they say it tastes better, and is better for you, and by New York Law milk can only be sold pasteurized. Hence black market activity.
So saying you cannot resell a product and people wants it. It will be done under the table.
Now the problem with black market is the buyer and seller loose legal protection. So the seller can rip you off and you have no legal recourse. Or the buyer can do something else to you and in order to get the guy in trouble you will need to admit to breaking the law. This is a problem with prostitution because it is illegal if the women are mistreated they do not have many options for them.
If something is so important that you feel the need to post it on the internet... It probably isn't that important.
Even worse, many items are made from petroleum. Just think of plastics and everything made from plastic or incorporating bits of plastic (I see some vinyl in that there car, sonny, and the tires are made of rubber). Now some of the petroleum used in making those plastics and related synthetics might have come from wells in the USA, but some might not and it tends to get blended during or after refining. The provenance of such intermediate materials is not tracked.
So we have another question: how much transformation of a foreign-sourced raw material or intermediate material derived therefrom would be needed to escape the consequences of this putative ruling? Would shaping foreign wood into furniture be sufficient? What about polymerizing a foreign-sourced material (making an intermediate of plastic or ceramic or rubber)? Even supposing a strict boundary could be defined for the amount of processing or transformation required, it would just lead to the creation and feeding of loophole-finding (or making) industries.
Those who can make you believe absurdities can make you commit atrocities. - Voltaire
Since time before time every merchant has known the following motto: Buy low. Sell high. Now with globalism we can buy labor and materials cheaply from the ends of the world and sell high in our own home market where half the populations lost their jobs to outsourcing. Isn't double dipping a great thing?
Wait, a private citizen like you wants to use the same strategy?! How dare you even think of this unpatriotic act circumventing the core values of capitalism? Preposterous! Only governments and large corporations are allowed to do that. You just take what you are offered at our fair and reasonable prices or we'll see you in court. Now go back to your television and be a model consumer.
Meanwhile in some research lab...
Hey guys, looky here! I have just found a new source of energy! We might be able to power our rockets and indeed our whole civilization with it! I call it hypocrisy and the best part is it seems to be an abundant and renewable resource in our civilization!
Some student from Thailand imported the EEE books from Thailand, sold them on E-Bay and made 1.2 million dollars. He is claiming immunity under First Sale doctrine. The EEE contract with the Asian publishers prohibit them from selling it to the lucrative western markets. But once the book has been bought in those markets, can they be imported and sold in USA? The appellate court ruled it can't be brought in sold.
I am not a lawyer, but I expect the Supreme Court to rule more narrowly. "When a copyright/intellectual property right originating from USA, is licensed to foreigners under some restrictive license, the foreigners can not use first sale doctrine and third parties/subsidiaries to circumvent the license restrictions". That is the kind of ruling I expect. That is, not all foreign made objects would be exempted from first sale doctrine. Those items made abroad under restrictive licenses from ip-holders in USA alone would be exempted. But I am not sure they will rule this way. I am an engineer most comfortable calculating intersections between triangles and tetrahedrons. I find them very easy compared to US laws.
One interesting tit bit was that, when I came to USA as a student with F-1 Visa, I was scared by the EEE books I was bringing in. I used some 75% of my baggage allowance with books. I knew how serious copyright law was in USA. I knew my books are cheaper in India. I was worried the immigration officer would reject my visa and send me back! Seriously. I was worried about everything from the turmeric powder in my hand baggage to the loose staple on the sealed I-20 form issued by the university attached to my passport! Once inside the USA, I was just relieved. I never even thought for a moment to buy millions dollars worth of EEE books and selling them cheap in the USA. There have been hundreds of thousands of students from Asia who knew the price differentials. None of us thought of exploiting it by arbitrage, because we knew it was "wrong". This creep from Thailand did just that. If the courts do not rule narrowly and uphold first sale doctrine for these EEE books, the publishers will simply stop licensing EEE books under cheap terms. Millions of Asian students will be affected.
sed -e 's/Chuck Norris/Rajnikant/g' joke > fact
"The rulers know that they are going to stop over the line and have the 3rd American revolution on their hands."
No they wont. The american sheep already accept and like it. Getting groped to get on an airplane is happily accepted by the majority of Americans. Having cops ready to tase you or even assult you for any reason is happily accepted by most americans.
As long as we have our cable TV and internet, we will be happy and complacent citizens...
Do not look at laser with remaining good eye.
Nope, USSR was Communist. The US is turning into a fascist country.
The major difference being that communist countries everything is controlled by the workers (in theory). In fascist countries the government is controlled by the corporations. This is obviously a case of the latter. PLEASE USE THE CORRECT TERMINOLOGY!!!!
You are entitled to your own opinions, not your own facts.
In a world where patent trolling is rampant... you'll see it happen, and unfortunately, if the ruling is upheld, you'll very likely if not definitely see the following:
- Pawn shops out of business
- 'legit' used car market evaporates or used car prices skyrocket to nearly the price of new (with all of the extra money going to the IP trolls)
- Trade stores (Gamestop, Trade It, etc) out of business
- Thousands upon thousands of jobs lost
- Billions of dollars in revenues (both tax and trade) disappear
- If they make it retroactive, lawsuits and repossession of property en masse
- If the law is applied evenly, the real estate market gets even more thoroughly screwed up than it already is (you sure that lumber and drywall is US produced? what about the wiring? light switches? ceiling fans? refrigerator? glass? vinyl/aluminum siding sheets? PVC pipe? faucets? the list goes on.....)
What matters is how you frame the law (or how the jurisprudence works out). In Europe, the law is explicit about importing for resale without the rights holder's permission. In this US case it seems they want to achieve the same, but they go about it differently, by more or less stating that IP rights on physical objects imported from abroad cannot be transferred by the first owner. No more parallel imports, sure, but an unintended side effect is that it does make private second hand sales of imported goods illegal. Unintended by the courts perhaps, but very, very much intended by the rights holders, who will most certainly break out the champagne if this is upheld.
If construction was anything like programming, an incorrectly fitted lock would bring down the entire building...
You do not seem to understand the significance of what you read. Basically it is this - immigrant student from Thailand goes to buy university text books and thinks "Wow. These prices are a lot more than I would pay back home for the same books. Maybe there is a business opportunity here." Then he recruits relatives to buy the books in Thailand at Thai prices and ship them to the USA, where he sells them on Ebay for over a million dollars in profit. John Wiley & Sons sues. Thai student invokes "first sale" as a legal defense, so it broadens the scope to include basically every manufactured good.sold in the USA. It is his invoking of "first sale" that has made this potentially into a gigantic nightmare.
ONLY corporations have PROPERTY RIGHT.
Signed, United States, Inc.
"Flyin' in just a sweet place,
Never been known to fail..."
Sure, at first, some people may notice that there used to be thrift stores. For a while. Some old geezers will say "I remember back in my day when you could just buy things, and then sell them--for cash!--and it was nobody's business but yours". But eventually, it will just be normal. Thrift stores will just be added to the list of businesses that aren't allowed to exist, and so they don't exist. And since they don't exist, nobody will care about getting the law overturned, because they will perceive no demand.
After all, who can say how many stores are currently NOT in existence due to over-regulation? Can you even begin to say what businesses are ALREADY not in existence, due to laws? How many picobreweries, tobacconists, brothels, non-health-department-licensed restaurants, non-licensed physicians and dentists? How many cheap delivery services are NOT in existence due to the Post Office monopoly on first class mail? How many people WOULD be growing MJ in their backyard if it was legal? Exactly how many cab drivers WOULD there be in Dallas if they weren't effectively regulated out of existence so as not to compete with light rail projects?
It's easy to say "this law is harmful because if we pass it, a valuable sector of the economy will disappear and thousands of jobs will be lost". It's harder to convince people to see the jobs and the economic sectors that aren't even there, that were never started, or that used to be there.
Out of sight, out of mind. People don't miss what they don't have, and once the regulated sectors of the economy dry up, people don't even see the regulations as unreasonable anymore. If all the thrift stores disappear, it will just be another of a thousand cuts to our economy, and then people will sit back decades later and wonder why the economy sucks and blame the other party for it.
Go for it. The Branch Dividians did very well with that. You're living in a police state that pepper sprays peaceful protestors, and zip-ties/handcuffs people so tightly they suffer nerve damage.
The NRA loves to talk about their 2nd amendment rights, but the sad truth is that any militia attempting to overthrow the government to get their country back wouldn't survive even 5 minutes against part-timers in the national guard.
If telephones are outlawed, then only outlaws will have telephones.
Don't be ridiculous. Almost every "American" knows that all humanity started with Adam, created by God, in the garden of eden, which, according to a lot of people now, was in the USA. None of this other country bullcrap, God picked America as the chosen land -- I mean, that's why he gave all the oil to Muslims... errr. wait a minute...
If telephones are outlawed, then only outlaws will have telephones.
The linked Marketwatch article is complete BS. Clearly the author had no idea what they were talking about, and just took one sentence and expanded it into massive hyperbole. Here are some choice examples from the article:
Put simply, though Apple Inc. AAPL -0.15% has the copyright on the iPhone
I don't think so. They have patents, not copyrights.
It could be your personal electronic devices or the family jewels that have been passed down from your great-grandparents who immigrated from Spain.
No, those things also cannot be copyrighted.
It could also become a weighty issue for auto trade-ins and resales, considering about 40% of most U.S.-made cars carry technology and parts that were made overseas.
Also nothing to do with copyright.
He himself once bought an antique desk from a Supreme Court justice.
Yet another example.
It sounds like the author just made stuff up as they went along. Here are some better articles:
SCOTUS! eBay! Cert and Other Sundries
Summary of Kirtsaeng v. John Wiley & Sons, Inc. at the Supreme Court's own blog
Otherwise, you would not be able to afford that "all American made" vehicle.
There is no such animal. Some vehicles are majority sourced in the US but no vehicle is sourced exclusively from one country.
That's right. The simple fact is that it costs more to build a car in the U.S. than it does to build, and deliver, a car made in Japan or Korea.
That is not true at all. A lot of cars are made in the US precisely because it is too expensive to build them overseas. Cost of labor is not much cheaper in Japan than it is in the US. Korea isn't especially cheap when it comes to labor either. Much auto assembly can be automated with sufficient volume so the labor differential is further reduced. You also have to account for where the parts for the vehicle are made - the number of auto parts made in the US is huge and shipping them elsewhere would be expensive. Furthermore you have to account for exchange rates. The Yen is quite strong at the moment which makes exporting from Japan expensive. Honda and Toyota build a LOT of cars in the US precisely because it is cheaper to build them in the US.
the court will have proven itself so divorced from reality that it no longer serves any useful purpose and should be dissolved. Believe me, I was thinking that after that little "money is speech" nonsense.
Please do not read this sig. Thank you.
I'm davidwr but I don't want to undo my moderation of the parent post. It was "-1 - troll" when I saw it, +1 insightful'd it, and by that time it was "2 - funny."
If the Supremes rule broadly that the First Sale doctrine doesn't apply to items which contain foreign parts, you'll see a disruption in the marketplace, but it won't be pretty.
SOME customers, notably some business customers who depend on the ability to re-sell, some governments looking for any excuse to "buy American," and a small percentage of individuals will insist on buying American when possible. SOME retailers will specialize in selling only products that their customers are "free to resell" but it won't become widespread, general practice.
Here's why:
Most large companies that control "IP" - studios, large software houses, etc., will make sure that their mainline products qualify as "made in part overseas." Yes, they may sell a "made in the USA" or "free to resell" version that has minor differences and huge up-front increased price so they can qualify to sell to governments and companies that insist on the "right to resell" but their retail products will prohibit reselling. Because they are willing to turn down business from SOME customers to protect their future sales from the resale market, they will essentially "force" most of America to either concede to the reality that they can't re-sell their CDs, or simply do without.
My hope is that the Court will do the opposite and make it clear that people have the right to re-sell what they've already paid for.
Same damn thing as in the books. You only rent something, never "own" it. Kelo vs New Haven showed who owns your home. The county or city, not you. You only get to buy and sell the leases fairly freely, but you don't own your house. That's why you have to get permission from the actual owner to alter it. In most places in the U.S., you can't even replace your kitchen faucet without permission from the real owner. Nearly everyone in an urban area walking out of a Home Depot is, or soon will be, in violation of local laws and often don't even realize it.
Peace is easy to achieve, just surrender. Liberty is much harder get/keep.
As I recall, we no longer make transistors in the U.S. So don't just think of used foreign merchandise. Think of EVERY product that uses an Asian made transister or microchip.
- No used cars
- No used computers
- No used cell phones
- No used electronics
- Very few used toys
Yes, there are few decisions that would cause a revolution and the mass murder of politicians. But if the Supreme Court decided in favor of the apellate court's decision. I'd wager the result of enforcing such a decision would be the end of the American political system.
I am pretty sure that the Supreme Court will give this an easy slap down.
There have been hundreds of thousands of students from Asia who knew the price differentials. None of us thought of exploiting it by arbitrage, because we knew it was "wrong". This creep from Thailand did just that.
Actually, engaging in this sort of arbitrage is virtually an American tradition. The only reason there's a lawsuit here is because there's intellectual property involved. If someone discovered that they could purchase Widget X in Country B at a lower price than in Country A, then bought a lot of Widget X and imported to Country A to resell at a higher price, we'd typically call them smart or at least entrepreneurial. Not to mention that consumers in Country A benefit from lower prices.
But since this involves copyright, normal logic goes out the window, and we're told that a book, lawfully purchased in Thailand, cannot be lawfully sold by its purchaser in the United States... because OMG WE NEED DIFFERENTIAL PRICING. You know what? Not my problem. Don't use copyright law to outlaw arbitrage. You want to make your differential pricing more effective? You could translate it into the local language, that'd be a huge barrier to reimportation and reselling.
BTW, this is the exact issue brought up in the Omega v. Costco case - except there it was even more ridiculous, since the copyright was on a design that happened to be stamped on the watch. Currently Costco is apparently winning the issue, since they're arguing that Omega is engaging in copyright misuse in order to control distribution of a normally uncopyrighted object (a watch).
"Anyone who [rips a CD] is probably engaging in copyright infringement." - David O. Carson
From TFA:
I see. So when jobs get shipped overseas because labor is cheaper, and companies can make a higher profit, I'm told I have to accept lower wages and compete in a global marketplace. When a consumer notices that prices are cheaper abroad and buys books there to increase his profit here, the courts change one of the fundamental concepts of Capitalism (that you can resell what you purchase) to stop him.
Can there be any doubt we live in a Corporatocracy? Can I get a fucking witness?
"What the American public doesn't know is what makes them the American public." -Ray Zalinsky (Tommy Boy)
Two months is a long time.
They feared that it could be used to suppress protest or support unpopular rule.
I agree with your point, mostly, but some of your examples are downright frightening to leave unregulated. There's enough dentists who are licensed that suck, there's plenty of bad doctors, and plenty of bad restaurants already - we don't need them to be unregulated to promote a vibrant economy. Imagine the harm to our country if people without any training could open up offices as doctors, or even worse, dentists, and you'll realize that while regulation isn't always good (why would we heavily regulate tobacoonists?), it's also required in other areas.