|
The
exhaustion doctrine, broadly defined, relates to attempts by
intellectual property owners to extend their control of downstream
uses of products covered by an underlying piece of intellectual
property protection. In truth, the exhaustion doctrine is normally
reserved for patent law. The copyright law counter part is referred
to as the first sale doctrine. In both cases, however, the law places
a requirement upon intellectual property owners to obtain all
financial benefit for the article or product embodying the
intellectual property at the time of the sale, and prohibits placing
limitations on purchased items.
The First Sale Doctrine of Copyright Law
The first sale doctrine allows purchasers of copyrighted material to
sell that which they have purchased without violating the copyright
laws. The theory here is similar to that of the exhaustion doctrine
in patent law. The copyright owner must derive all revenue from the
so-called first sale, and cannot control the future disposition of
the article originally sold.
Under a strict reading of the copyright bundle of rights, selling or
distributing a copy of a work that is covered by a valid copyright is
an infringement. The problem arises in this scenario. You purchase a
book that is copyright protected. You read the book and now have no
use for the book. You sell the book. By completing the sale you have
distributed a copy of a work that is covered by a valid copyright. If
it were not for the first sale doctrine what you just did would be
copyright infringement; namely distributing a copyrighted work
without the permission of the copyright owner.
The key to understanding the first sale doctrine is to know that the
copyright owner only has right to prevent others from copying and
distributing (for free or for profit) copies of a work covered by a
valid copyright. In the above example there has been no copying and,
therefore, no infringement. You have taken what you purchased and
transferred all right, title and interest to another. The copyright
owner cannot stop this. The key, however, is that there has been no copying. |
|
Change the facts to a more typical situation in the new digital
economy, and the outcome would be very different. If you purchase
software or perhaps an MP3 and you load it to your computer and then
keep it on your computer and sell it to another you have committed
copyright infringement. In order for the first sale doctrine to apply
to this situation you would have had to erase your copy upon
transfer. If you did this it would be the same as transferring what
you purchased. Keep a copy, however, and you are now not only
distributing, but also copying, which is prohibited by the Copyright Act.
Increasingly copyright owners are attempting to curtail first sale
doctrine rights. Although the first sale doctrine is codified at 17
USC 109, there is a significant interplay between copyright law and
state contract law. Federal law grants copyright protection, as well
as defining certain things that users can do without fear of
violating copyright laws. State law of contracts, however, allows
individuals to order their own affairs and take on obligations of
their own free will. With this in mind many copyright owners are
extracting from users promises in shrink wrap licenses and click on
agreements that limit or abolish first sale rights.
The trend in the courts has seemed to be that such contracts are
valid and enforceable, although they are not typically enforced.
Given the growth of online auctions this could change, and may be
changing already. At some point in the not to distant future it is
likely that the courts will need to again address the interplay
between copyright law and contract law. In January of 2003 the United
States Supreme Court is some rather cryptic dicta seemed to suggest
that fair use may be a constitutional requirement, which would mean
that contractual attempts to abolish fair use rights would be
unconstitutional. This may be a blip on the radar screen, or it may
foretell the future where courts will have to define what copyrights
individuals can give up under contract laws. In the meantime,
however, if you are a copyright owner quite a lot can be done to
strengthen your copyright and limit the rights of end users and
consumers if appropriate language is included in a copyright license.
The
First Sale Doctrine and Digital Phonorecords - Duke University
The
First Sale Doctrine in the Era of Digital Networks - Boston College
Eldred
v. Ashcroft: Looking for the Bright Side - published by
JURIST in Jan. 2003
|
