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Copyright Experts Examine Case Challenging Limits of First-Sale-Doctrine

 

The nationwide discounter Costco did not set out to invite a lawsuit when it began selling luxury Swiss-made Omega watches bearing copyrighted logos from its store shelves. But it now faces one anyway, and the issues are wrapped up in a case that is being closely watched by copyright and intellectual property lawyers.

 
The case is Costco Wholesale Corp. v. Omega, S.A, a case argued before the United States Supreme Court on Nov. 8.  The Columbus School of Law and CUA’s School of Library and Information Science co-sponsored “The Pending U.S. Supreme Court Case of Costco Wholesale Group v. Omega, S.A.: How Broad Is Copyright Law’s First Sale Doctrine and What Are the Consequences for Libraries and Business?”, a discussion aimed at illuminating the underlying issues.
 
At stake is the interpretation of the “first-sale doctrine,” recognized by the Supreme Court in 1908 and subsequently codified in the Copyright Act of 1976.  The doctrine allows the purchaser to sell (or give away) a lawfully made copy of the copyrighted work without permission once it has been obtained. This means that the copyright holder's rights to control the change of ownership of a particular copy ends once that copy is sold, as long as no additional copies are made.
 

                  

 
Omega claims that Costco is liable for copyright infringement for importing Omega watches that were manufactured abroad and distributing them in the United States without permission. It argues that the first sale doctrine limiting the right of distribution does not apply to goods manufactured abroad and sold overseas exclusively for distribution outside the United States.
 
The eventual ruling in the case could have profound, if unintended consequences for libraries as well. Many hardcover books today are manufactured overseas, and the Supreme Court’s opinion could conceivably endanger library lending.
 
The panelists were Jonathan Band, a specialist in technology law who is the author of an amicus brief filed by the American Library Association; Scott Bain, chief litigation counsel for the Software & Information Industry Association, who is the author of an amicus brief filed by the SIIA; and Steve Tepp, a senior director at the global intellectual property center at the United States Chamber of Commerce. The panel’s moderator was CUA alumnus Judge Edward J. Damich, who currently serves on the United States Court of Federal Claims.