Source: https://patentlyo.com/patent/2012/10/kirtsaeng-v-john-wiley-oral-arguments.html
Timestamp: 2019-09-19 05:24:31
Document Index: 437586772

Matched Legal Cases: ['§107', '§109', '§106', '§108', '§602', '§107', '§122', '§106', '§102', '§ 109']

Kirtsaeng v. John Wiley Oral Arguments | Patently-O
October 29, 2012 PatentDamages, LicensesDennis Crouch
Here are a few quotes from today’s oral arguments. More discussion of the case here.
MR. ROSENKRANZ: (on behalf of accused infringer Kirtsaeng): What [copyright holders] got [with the passage of Section 602] was a much more powerful weapon than a contract. [A] copyright weapon gives you injunctive relief, gives you multiples of damages which you don’t get out of a contract remedy.
MR. ROSENKRANZ: The moment that a manufacturer learns that this Court says you get what we’ve called the Holy Grail of manufacturing, endless eternal downstream control over sales and rentals, you can ruin secondary markets that are competing with you, the moment that happens, that will be yet another reason for manufacturers silently to decide that they’re headed — that they’re sending their manufacturing overseas.
JUSTICE KAGAN: Mr. Rosenkranz, can I take you back to Justice Ginsburg’s opening question? Just as a matter of copyright theory, I had always understood [that] a copyright holder has a kind of a bundle of rights. It’s not one right that applies everywhere in the world. It’s you have your U.S. rights and you have your Chinese rights, you have your rights under each jurisdiction’s law. And your position is essentially to say that when I sell my Chinese rights to somebody, I’m also selling my U.S. rights to that same person, because the person who has the Chinese rights can just turn around and import the goods. I mean, that’s the nature of your position, isn’t it, that your U.S. rights are always attached when you sell more — your rights under the jurisdiction of another country?
MR. ROSENKRANZ: Well — so first, Your Honor, back in 1976, this notion of geographic division was very, very new, so it’s not at all clear what Congress was thinking with that — with respect to that. But secondly, no, we’re not — we’re not saying that when the owner sells his Chinese — its Chinese rights to the Chinese company, it is selling all rights. Certainly, the Chinese company cannot sell everywhere, but after that first sale, all of the manufacturer’s rights are cut off.
JUSTICE BREYER: I mean, an American copyright holder licenses a British company to publish the work under British copyright law. 602(a) says he can’t import the books into the United States, period…. The question is what happens when he sells it to his bookstore and you or I go in and buy it and we want to give a copy to our wife when we get back to the United States. The question is, … is that unlawful? … [What if] I bring back five copies and I give one to my son?
MR. OLSON (arguing on behalf of the copyright holder John Wiley): Well, there are fair use exceptions …
JUSTICE BREYER: [I]magine Toyota, all right? Millions sold in the United States. They have copyrighted sound systems. They have copyrighted GPS systems. When people buy them in America, they think they’re going to be able to resell them…. Under their reading, the millions of Americans who buy Toyotas could not resell them without getting the permission of the copyright holder of every item in that car which is copyrighted?
JUSTICE KENNEDY: You’re aware of the fact that if we write an opinion with the — with the rule that you propose, that we should, as a matter of common sense, ask about the consequences of that rule. And that’s what we are asking….
JUSTICE BREYER: I would like to know, if you were the lawyer for the Toyota distributor, and if you were the lawyer for the Metropolitan Museum of Art, or you are the lawyer for a university library, and your client comes to you and says, my God, I just read the Supreme Court opinion. It says that we can’t start selling these old books or — or lending them or putting them in our word processor or reselling the Toyota without the — without looking — displaying the Picasso without the permission of the copyright holder, who may or may not be Toyota itself. What, as their lawyer, do you tell them? Do you tell them, hey, no problem; or, do you tell them, you might become a law violator; or, do you tell them, I better litigate this? What do you tell them?
MR. OLSON: Well, each one of those situations that you posit, Justice Breyer, has a whole panoply of set of facts. With respect to the museums, with respect to the person bringing books into the United States, there are other defenses, including fair use. There are other defenses under the copyright law. But — and one of the things is that, to a certain extent, if you’re going to use the product created by someone else in a way that’s contemplated by the copyright laws, maybe it’s required that you actually comply with the copyright laws by going to the owner of the copyright and saying, look, here’s what I propose to do, can I have a license to do this?
MR. OLSON: There are several answers to that. One, that’s Congress’s concern. And — and there is no evidence that that would really actually happen. And Congress was concerned with creating a segmentation of the market. But it’s entirely speculative as to whether or not people are going to start manufacturing books or other items outside the United States. Congress can address that if that should become a problem, but it’s not something that was suggested as a part of what was taking place at that time.
JUSTICE BREYER: Well, the word has grounding. [What about the ancient principle found in] Coke on Littleton, 1628, where it says that “if a man be possessed of a chattel and give or sell his whole interest upon a condition, that condition is no good.” And Coke says, and that’s how it should be. And now that’s picked up in Bobbs-Merrill; it’s picked up in Dr. Miles. It’s been the law. Now if, in fact, there are two ways of interpreting the statute, and one is consistent with that basic principle of commercial law, and the other produces some of the complexities that you have just mentioned, isn’t it better to go with the common law and simply reaffirm a principle that’s been in the commercial law almost forever?
MR. STEWART (arguing as amicus on behalf of the US Government): I give two answers for that. And the first is that Coke was saying that, in most circumstances at least, a sale is sufficient in order to divest the owner of his prior right to control distribution, but it doesn’t say that a sale is necessary. And my point is that when Mr. Rosenkranz says the hypothetical foreign publisher who makes copies with authorization but ships … them into the United States without [authorization] could be held liable for infringement, there is nothing in section 109(a) that would allow a court to draw that distinction; that is, although 109(a) is sometimes referred to as a codification of the First Sale Doctrine, it doesn’t require an antecedent first sale. So as long as the foreign publisher was the owner of the books at the type — time they were manufactured, if those books were lawfully made under this title, under Petitioner’s reading they could be imported and distributed. We know also that this was not an oversight, that Congress didn’t intend the provision to be subject to a sort of implicit first authorized sale requirement, because the language was intended to cover copies that were made pursuant to a compulsory license.
No direct mention of patent law in the oral arguments.
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42 thoughts on “Kirtsaeng v. John Wiley Oral Arguments”
I love Justice Breyer’s quote from Coke. That should be the guiding principle.
he means the software in those systems, which is clearly copyrightable.
anon, I’ve thought about it for awhile, and it does seem clear that the owner of a copy lawfully made outside the US has the rights granted him by 17 USC 109. National treatment is provided elsewhere, for example, in 602 (importation).
“because it was so easy to argue his side of the case”
Except that is not true at all. See my other posts on this and the sister thread.
anon, Olson got hammered, indeed.
I find it on that Olson had no good argument prepared because it was so easy to argue his side of the case. If the copies are imported or sold in the United States under the authority of the copyright owner, there is exhaustion. However, if a copy sold abroad is imported into United States without the copyright owner, there is no exhaustion. Seems to me that the case is simple.
But then there is the muddle of the statutory language itself.
I find myself in agreement with MM.
The transcript is absolutely brutal for Mr. Olson, and the government is downright dismissed after admitting to Kirtsaeng’s position.
Ned, did you notice the part how Mr. Olson waded into the Dicta/Holding and then threw up a white flag?
It’s a problem for Mr. Olson and his client that he was not able to answer Justice Breyer’s/Kennedy’s question about the resale of the car (at least, that’s how it appears from the transcript posted above). What Olson wants, of course, is for the law to be crafted by the Supremes so that it benefits his corporate client but doesn’t have the potential to wreak havoc on ordinary people. But the Supreme Court isn’t going to do that.
You can put a fork in this case. Kirtsaeng won.
I don’t think Breyer is confused at all. The software embedded in GPS systems and in sound systems are certainly subjects of copyright, which makes those systems “copyrighted.” It’s clear (at least to me, and apparently to Justice Breyer) that this case could have profound impacts on how companies seek to restrict grey markets in consumer electronics and other products that are more often thought of as functional and not expressive.
LOL – good to see you trying to up your substantive content.
You flubbed the difference and that was no lie. The fact that you think it a lie is only more of your (typical) black is white “view based on what you are comfortable with.”
Your example is a FAIL.
Sorry – this is not an area that you get to be your own lexicographer.
As to the reality of free (you missed the free beer), I also did not LIE. Sorry, but you are wrong yet again.
As to “the issue in Prometheus,” your evident (and massively repeating self defeat) is legendary.
Sorry – I should have been clear: give me an example of a REAL lie.
On the other hand, your new attempts to attack the functionally related exception to the Printed Matter Doctrine, now that you cannot outright lie given your admission of knowing the functionality is law is quite amusing. It hasn’t come up yet (again), but your admission of configuration is structure should also cause you to gyrate wildly to avoid your (typical) lying on those discussions.
As I have often said, when you attempt to actually engage in substantive discussion, you flub badly, and that is why you are easily this site’s most offensive, abusive and insulting poster. I remember the thread awhile back that greater than 90% of your posts in one week had gratuitous insults that had NO place in a discussion. The fact that you now deign to lecture on “Or you can just st[eff]u with the gratuitous smears already. Thanks in advance.” is hilariously ironic. It’s like you are a caricature of yourself and you are oblivious that the laughter you hear is not from people laughing with you.
Miss Jones, I am not the evil person you think I am. I am only the messenger reporting on an evil that is afoot.
I would agree with you that when one sells a patented or copyrighted item to an end user, that one owns the copies of software included in the products you buy, and that any licenses that purportedly restricts your use or that limits your right to sell are not enforceable.
However, I have actually had cases where a vendor has sold us machines, licensed proprietary software to us that can only be operated on those machines and then demanded a large royalty when we attempted to sell the machines on the basis that we had no right to transfer the license to the copyrighted software.
I think the difference in this situation and in the ordinary consumer transaction is that when you have a bona fide license, negotiated, and where there is substantial ongoing royalties or obligations, the situation may be entirely different than when you sell a copy of a product embedding software to a customer.
Show me one lie that I have EVER posted.
“[MM] flubbed the difference between copyright and patent when [MM] proclaimed that copyright was enough protection for software
I didn’t “flub the difference” between anything. If I “proclaim” that chocolate sauce is an adequate topping for ice cream, I’m not “flubbing the difference” or “conflating” or “confusing” chocolate sauce with fresh strawberries. It would be ridiculous to think that. But that’s how you roll, anon. Every. Flipping. Day. And not just with me. You do it with just about everybody else who comments here except your twin brother, 101E, who strangely enough is (beside you) the other most prolific writer here of similarly oddly-articulated, paranoid and defensive rants.
That example I provided is just the tip of the iceberg with respect to your gameplaying by the way. You want to see a great example of “flubbing the difference”? We only need to flash way way, way back to a couple days ago when you “flubbed the difference” between a “free” market and a market that’s regulated by the government. Let me know if you’ve forgotten that classic exchange already.
Or we can flash back to a couple weeks ago when you (and your twin brother) “flubbed the difference” between a process claim that was construed to recite a mental step (i.e., the claim at issue in Prometheus) and a process claim that was not so construed (the claim at issue in Diehr).
Or you can just st[eff]u with the gratuitous smears already. Thanks in advance.
MR. OLSON: “Well, there are fair use exceptions …”
Wrong. Fair Use exceptions are codified following the same legal construct. Fair Use (§107) and First Sale (§109) are limitations upon the exclusive rights of §106, as are the exceptions for libraries and archives (§108).
If Wiley’s position prevails in making First Sale limitations subordinate to §602, so will all the other limitations(§107-§122) called out in §106.
You are arguing that no one is allowed to resell anything they own. You say that it is illegal to sell used cars because you are selling leased software along with the car.
The problem is with the whole lease-vs-sell issue. Companies CLAIM to SELL you a radio or a car or even a software product, then, after they have your money, they pull the old switcheroo and claim they did not sell anything and you do not own what they just sold you. That is ths problem with allowing companies to write their own laws via “contracts” that are forced on consumers, and it is just another reason that the whole patent and copyright system needs to be scrapped. No one would vote for these laws. The laws are bought by bribery from a corrupt congress.
No one deserves to be paid for one hundred years for something they did. No one. Copyrights in this country are just a sign of the corruption of corporations and government and the thugs that run the place.
You are a terrible, evil person if you support US Copyright and patent law. Shame on you.
“you keep broadcasting your d—b-ss self-serving lies.”
Accusing others of that which you do (again).
Don’t you get tired of that gig MM?
I recently pointed out how you flubbed the difference between copyright and patent when you proclaimed that copyright was enough protection for software.
Do you need a primer in IP basics? (That’s a rhetorical question)
MM’s flubbing of the distinction between copyrights and patents
This never happened except in your mind, anon.
What has been pointed out before, anon, is that you are an unrepentant hypocrite who spent years trolling this blog with your sxckpuppets because not enough people shared your fxxxxed up obsessions.
And I’ll keep pointing out this fact, anon, as long as you keep broadcasting your d—b-ss self-serving lies.
ustice Breyer does seem to ignore what the “S” in “GPS” stands for.
I’m sure it seems that way to you, CC. Maybe you should write a letter.
In any case, Justice Breyer does seem to ignore what the “S” in “GPS” stands for.
Either that, or he’s also one of those redundant souls who uses his PIN number at the ATM machine.
please explain how you intend to “copyright” a “system”
Same way you “copyright” a “wristwatch”.
MM’s flubbing of the distinction between copyrights and patents has been pointed out to him before.
Apparently, he is having too much ‘fun’ to understand the basics.
If you think so, please explain how you intend to “copyright” a “system”, like Justice Breyer appears to suggest.
Justice Breyer doesn’t say “copyrighted firmware”. He says “copyrighted sound systems” and “copyrighted GPS systems”. Do I need to remind Justice Breyer, or any contributor to this blog, of the content of 17 USC §102?
Does one have the right to sell a leased machine?
What is all this conversation about selling machines with software? All software is licensed. Does one have the right to sell licensed software or a licensed machine?
Does the answer depend on whether the license is a copyright license or a patent license?
You are mistaken, CC. That’s why you should never give up hope!
Not at all. You can’t legally copy the firmware of your GPS system and sell that copy, because you don’t hold the copyright. Breyer is suggesting that if exhaustion didn’t apply, then every piece of firmware in your foreign-purchased car – including your in-car GPS or sound system – would have to be removed before you could legally sell the car.
He sounds profoundly confused and ignorant
I’m sure he sounds that way to you.
@MM – Breyer’s hypos are on the money? He sounds profoundly confused and ignorant distinguishing between patents and copyrights, and the static version of software and the executing – functional version – of a software application. He’s an ‘optimal use’ guy who refuses to believe that the free market can set a price for a property right.
Is Anon’s point that if the copyright holder wants to argue that the US Copyright applies, how can the copyright holder turn around and argue that the item was not lawfully made “under” the US statute and therefore subjected to exhaustion under the same statute? Either it was not lawfully made “under” the US law and gets no protection, or it was lawfully made “under” the US law and it is subject to exhaustion “under” the US law.
Daniel Law Offices says:
Interesting conversation here on this particular blog.
I also think it important to keep in mind that the particular items were placed in commerce by the rights holder on terms set by the rights holder.
This does in fact come down to an attempt to control secondary markets – albeit secondary markets driven by international inconsistencies. But one cannot forget that those very inconsistencies are controllable by the party placing the goods in commerce*. That entity has full control of the decision to so place the goods into commerce.
If a price disparity exists due to a regional law (for a hypothetical example of India setting a price cap on medical books for its own national policy reasons), the entity always maintains the decision making authority to enter that market, knowing that it is placing its goods into the stream of commerce at a price differential. I do not think that any such price disparity – even those driven by national law – should be allowed to eviscerate secondary markets. The option and the control to enter any market is up to the original rights holder, and once that rights holder decides to enter and give up rights to particular copies, alienability of those particular copies should not be compromised.
The result may be harsh – that those countries setting price caps may price themselves out of goods. But that is a consequence that should not be ameliorated – or taken advantage of – by entities and their decision to (or not to) place goods in commerce.
*I am cognizant of the effect of forced subsidies that countries may place into effect, but those situations are different from the existing fact pattern and can be dealt with as exceptions without doing great harm to the concept of alienability.
Thanks for the link Judith_IP.
I am not sure you caught the nuance of the double-dealing (wanting “not under” and “under” at the same time). I am fine if you think that Berne makes the items “under,” but then one must apply this reasoning consistently, no?) Wanting protection under the law, except for the portion of law (17 USC § 109) that applies in this situation seems incongruent.
I especially liked “Protection against un­authorized use in a particular country depends on the national laws of that country.”
So is the proper question one even of US exhaustion rules? Does it matter then that in the country of origin the particular item, being properly bought is exhausted there? This still brings us back full circle to one wanting protection “under,” yet not applying certain exhaustion rules “under.” We still have “double-dealing.”
Since the actual physical items in question were legally bought, and we are not talking about any actual copying or reproduction, the stick in the bundle of rights under focus is that of merely moving a specific item (or in this case a plurality of such) from one location to another, and then disposing of that particular item(s). Alienability of one own’s possession – and in effect, distribution rights (of particularized copies, and thus the notion of secondary markets) are pertinent*. But distribution rights across national boundaries given that no true international copyright rights exist. I am not certain that the extension of distribution rights to particularized items already sold – with the copyright owner already having received the full price for which they had asked just in order to protect a particular purely business mode (geographical segregation) and thus easily divorced from the traditional intent of copyright is a firm or strong policy (or should be so). In essence, the case here is attempting to create an international right where no true international law is available to support that right.
What does Berne have to say about exhaustion of the stick of personal alienability?
14ter seems close, but I am not sure that the articles here can be classified as either original works of art or original manuscripts of writers and composers since this are mass-produced goods in commerce.
* – the US carve-out for sound recordings and computer programs, notwithstanding – although (b)(4) is interesting in the reading that only sound recordings and computer programs seem exempted (leaving items such as the books in this case not exempted.
They have copyrighted sound systems. They have copyrighted GPS systems.
I’m hopefully mistaken, but Justice Breyer’s sentence gives me a horrible feeling that he ignores the difference between patents and copyright…
I would expect that the law includes the Berne Convention, which therefore covers products made in those countries that are signatories. link to copyright.gov
You can’t expect Kagan’s views as SG, on behalf of her client, to be identical to her views as a Justice.
And you may recall that Costco v. Omega was looking at narrower question whether the first sale had to occur in the US to trigger the first sale doctrine. This case, from the Second Circuit, is making the much broader argument that international manufacture entirely obviates the first sale doctrine.
If someone posted an answer to this, I must have missed it, but how is protection under the law being sought for something said to be not created under the law?
Chief Justice Berlove says:
MM(F?),
It all boils down to Justice Kagan’s vote. Costco v. Omega tied 4-4. And Kagan as SG supported the regulatory side. So it’s going to be a tough one for John Q. Public.
Well, I believe the versions that Microsoft sells in China are in Chinese. So I don’t think that will cut the heart out of MS’s business (I’m pretty sure MS thought about that a long time ago.) In fact, I believe the new Windows 8 supports all different languages in most countries, except the version sold in China, which will be cheaper, will not.
Is it your position, Malcolm, that if MS sells Windows in China at a vastly reduced priced due to rampant piracy that the purchasers of such products, produced by MS, may import them into the US and cut the heart out of MS’s business?
JUSTICE KENNEDY if we write an opinion with the — with the rule that you propose, that we should, as a matter of common sense, ask about the consequences of that rule. And that’s what we are asking….
The most important statement in the record. I thought Breyer’s hypotheticals were right on the money, no pun intended. Wiley will lose. The public will win. Mickey Mouse will cry. Congress will hear the weeping …