First sale under fire: JOHN WILEY & SONS vs KIRTSAENG

One of the most basic tenets of modern business, copyright and trademark law is the doctrine of “First sale”.  The idea behind this doctrine is to balance the concerns of companies and producers with the common sense and practical actions of consumers.

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The idea is that physical products that are copyrighted in America are allowed to be sold in a manner that the producer sees fit (when, where and for how much, etc.), however once this item has been sold, the producer loses all control over the product.  In short, once something has been sold outright, the customer is free to resell the item as they see fit.  This is how thrift stores, used book stores and Gamestop all stay in business.

Today the Supreme Court will weigh in on the case of John Wiley & Sons v. Kirtsaeng.  The general premise of the case is that Supap Kirtsaeng discovered that many textbooks that the company John Wiley & Sons sells overseas are far cheaper than those sold in America.

So cheap in fact that Kirtsaeng had his family overseas buy books and ship them to America where Kirtsaeng would then resell them on eBay at a price point high enough to make a profit but still low enough to undercut John Wiley & Sons sales here in America. Seems pretty straightforward, right? Capitalism at its finest.

Well, the thing about first sale doctrine in America is that it covers American made products. So what John Wiley & Sons are trying to argue is that since these foreign books are manufactured abroad and being imported they are exempt from the first-sale doctrine.

A Supreme Court ruling in favor of John Wiley & Sons means more than just a textbook manufacturer getting away with bullying an entrepreneurial spirit and getting away with extreme levels of price gouging here in America, it also sets a nasty precedent for the numerous items we use everyday.

Think about it: It’s easier to point out the things in your room that were made in America than those that were not. Clothes manufactured in Taiwan, computer parts from Thailand, or the near infinite number of products imported from China.

Now on a personal level, direct person to person transactions will most likely not be affected simply because there is no easy way for a company to detect them. But large stores that deal in second-hand sales will most likely face increased pressure as will anyone selling such products online.

For example, all Apple would need to do to challenge a major sector of the second hand market  is to write a script that looks over eBay and craigslist postings that contain the words iPad, iPhone, or iPod and simply send an automated boiler plate cease and desist to the email address provided.

This is about more than the economy though, this is about not giving corporations any more power over consumers than they already have. The simple nature of corporations, large groups of humans organized around making large amounts of money, already makes them more powerful than any one human being, but the more laws that serve to favor a corporation over an individual simply widen the power gap.

If Mr. Kirtsaeng were buying textbooks on the cheap in Broomfield and then undercutting the CSU bookstore here in Fort Collins, he would be lauded as an entrepreneur and a paragon of American capitalism.

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There is nothing intrinsically different about a textbook printed in America and a textbook printed overseas, and there is no reason — except for the greed of humans — that first sale doctrine should not apply.

What this case really boils down to is that John Wiley & Sons inflated the price of textbooks in this market for the sake of profiteering and someone found a way to burst this little textbook bubble.

Then, rather than graciously bow to the invisible hand and lower their prices to something more reasonable, this company has decided to twist and abuse the word of the law while ignoring the spirit in an attempt to maintain a stranglehold on their prices, and in the process undermine the rights of consumers under first sale doctrine.

One of the core tenets of capitalism is that when you buy a physical product, that physical product is yours to do with what you will. I think the fact that there is even a debate about this is absurd and shows just how much pressure corporations can exert on our judicial system.

Corporations don’t need any more help from the law and any ruling other than one in favor of Mr. Kirtsaeng will just be further proof that the needs of the people are not the main priority of our government.

Hamilton Reed is a senior computer science major. His columns appear Mondays in the Collegian. Letters and feedback can be sent to letters@collegian.com.