US Supreme Court Upholds Right to Resell

[CyGuy]

Originally Posted by HarryT

This was about importing textbooks from Thailand (where they're very much cheaper) and reselling them in the US. Such "grey imports" are illegal in the EU, for example, and there are very good reasons for that.

If the same book is cheaper in Thailand then someone is overcharging for the book here.

[Elfwreck]

Originally Posted by taustin

The issue was whether or not it was legal to import books to sell in violation of another countries laws, specifically when those laws conflict with US law and international treaties the US has signed.

No, the issue was whether it was legal to sell (or "distribute") copyrighted content purchased under another nation's copyright laws. This affects everyone who visits a foreign country, buys a book to read, brings it home, and offers to give it to a neighbor when they're done with it. The case was created because of a purchase-with-intent-to-sell situation, but the prosecution wasn't looking for a ruling limited to those circumstances--they wanted it to be illegal to sell foreign copyrighted material, period. (For understandable reasons; it's awfully hard to prove "purchased for resale purposes.")

The end result would've been that I can't resell the book I ordered from Finland without getting permission from the copyright holder. There is no US edition (or I would've happily skipped the ~$20 shipping fee). The prosecution tried very hard to ignore the fact that many copyrighted works manufactured in other countries have no "US edition" that a customer could purchase instead.

The original ruling was so broad it would prevent resale of cars and mp3 players if they weren't entirely manufactured in the US. (Well, not "prevent." They'd just have to get permission from every owner of copyright for the software in their automobile before they could sell the car.)

I can understand manufacturers wanting to maintain low-cost zones of sales, and I'm in favor of arranging laws so they can do so, but they can't do it by banning all resales of objects outside of their original sale zone.

[Elfwreck]

Originally Posted by CyGuy

If the same book is cheaper in Thailand then someone is overcharging for the book here.

No, books are sold in Thailand with Thailand's income in mind. Books sold in the U.S. are based on the premise that workers are making at least $7.50/hour (except in some of the tip-driven trades in some states). Thailand just recently instituted a minimum-wage law: just under $10 per day.

If books are sold in Thailand at U.S. prices, the Thai people will not buy books. If books-in-English in Thailand are sold at U.S. prices, the Thai people will not read books in English.

However, I don't see that a single family's purchase Thai with US money, and then shipping them to the US, is going to destroy the publisher's profit margin

[taustin]

Originally Posted by Elfwreck

No, the issue was whether it was legal to sell (or "distribute") copyrighted content purchased under another nation's copyright laws.

That's what I said.

[Ntsimp]

Prices are set at what the market will bear. The US market will bear a lot more than the Thai market for these books, but I assume the publisher isn't losing money on its Thai sales; they're still profitable.
So the publisher profited from selling these books to the reseller, who profited from selling them in the US. Ergo the publisher would still have made money selling them in the US at the same prices as the reseller did.
Globalization doesn't have to benefit just the corporations.

[DianNC]

Originally Posted by tubemonkey

to SCOTUS - great decision.

Six of 'em, anyway.

[speakingtohe]

So will Wiley and others simply stop publishing their books in other countries?
Time will tell.

[Elfwreck]

Originally Posted by taustin

That's what I said.

You said it was about importing books to sell in violation of another country's laws. It was much broader than that; the copyright laws of Thailand weren't being violated, and the publishers were trying to claim that U.S. copyright laws were being violated when someone went to another country, bought works there at retail price, and brought them here to sell.

There may be import fees/duties required for such content, but until a couple of very recent cases, nobody questioned whether it was legal to make the sales. It generally wasn't worth the effort--retail markup and shipping costs made the profit margin low; for a long time, it was only worth bothering for novelties. Until major portions of U.S. manufacturing were moved overseas, it was never cheaper to buy there and bring here.

[holymadness]

Originally Posted by Elfwreck

However, I don't see that a single family's purchase Thai with US money, and then shipping them to the US, is going to destroy the publisher's profit margin

No, but it does establish a unique opportunity for (large-scale) arbitrage. And if sufficient individuals undermine local prices by importing and cheaply reselling the same goods from elsewhere, there will eventually be an impact on the publisher.

[teh603]

Originally Posted by Elfwreck

However, I don't see that a single family's purchase Thai with US money, and then shipping them to the US, is going to destroy the publisher's profit margin

Have a look at a software EULA sometime and look at the number of things you can do that could "irreparably damage" the company without meaningfully affecting its profit margins. It doesn't matter that you do or don't do; the company wants to be able to sue for unlimited damages.

Originally Posted by holymadness

No, but it does establish a unique opportunity for (large-scale) arbitrage. And if sufficient individuals undermine local prices by importing and cheaply reselling the same goods from elsewhere, there will eventually be an impact on the publisher.

The whole case also proves just how greedy the textbook companies are. Instead of making them available to everyone at Thai prices (which are probably closer to the "cost of manufacture" prices that you're supposed to get in a "free market," ), they sue to keep gouging US students.

[jgaiser]

Originally Posted by Elfwreck

No, books are sold in Thailand with Thailand's income in mind. Books sold in the U.S. are based on the premise that workers are making at least $7.50/hour (except in some of the tip-driven trades in some states). Thailand just recently instituted a minimum-wage law: just under $10 per day.

If books are sold in Thailand at U.S. prices, the Thai people will not buy books. If books-in-English in Thailand are sold at U.S. prices, the Thai people will not read books in English.

I don't often find things to argue with you, but this whole conversation is silly.

I generally agree that Thai wages are smaller, but if a publisher can make a profit in Thailand with the prices they put on the books that are sold there, someone is making a killing when the same books are sold in the U.S. (unless, of course, if the books are completely produced in Thailand at those lower wages and costs).

[holymadness]

Originally Posted by teh603

The whole case also proves just how greedy the textbook companies are. Instead of making them available to everyone at Thai prices (which are probably closer to the "cost of manufacture" prices that you're supposed to get in a "free market," ), they sue to keep gouging US students.

I suspect publishing is not a very high-margin business, in which case accusations of profiteering may be misplaced, but feel free to correct me if I am wrong. On the other hand, students are a perfect instance of a captive market, particularly when publishers collude with professors to insist on the necessity of a new, but scarcely modified, edition every year. This shameful practice not only ensures incoming students pay $150 for new textbooks, but it cuts the legs out from under outgoing students trying to resell their old copies.

[Jozawun]

Originally Posted by taustin

Not . . . really. Aside from SCOTUS not having to make any particular ruling bindind case law, the issue in this case was specifically books printed and sold in a country that is not part of the Berne Convention, and has no first sale doctrine of its own. The issue was whether or not it was legal to import books to sell in violation of another countries laws, specifically when those laws conflict with US law and international treaties the US has signed.

This was really a very limited case, despite the hysteria that was generated over it.

He bought the books in Thailand, which is a party to Berne and has been since 1931.
The case had nothing whatever to do with Berne; it concerned the interpretation of two (apparently) conflicting provisions of the US Copyright Act, one of them a codification of the US's own domestic First Sale Doctrine which, again, is nothing whatever to do with Berne.

[Elfwreck]

Originally Posted by jgaiser

I generally agree that Thai wages are smaller, but if a publisher can make a profit in Thailand with the prices they put on the books that are sold there, someone is making a killing when the same books are sold in the U.S. (unless, of course, if the books are completely produced in Thailand at those lower wages and costs).

Heh. Well, yes. Even if they're produced in Thailand, if this guy could afford to have them shipped to the US--at retail/consumer shipping costs--and make a profit, then so could a larger company.

Possibly, the Thai publications aren't enough to cover the entire US market, and the defendant here was capitalizing on matters of scale, but I doubt it. Thailand isn't known for its busy publishing industry; I expect many of the books sold there are actually printed elsewhere. China, perhaps. Shipping them to Thailand is a lot cheaper than shipping them to the US.

But the markup of US books is a lot higher than "shipping costs + a bit more for overhead + a bit more for profit."

[fjtorres]

The supreme court was pretty straightforward: the court found that the law, as written, does
not distinguish geographically and that, since a previous version of law did, it was clear Congress had chosen to remove geographic restrictions to the first sales rights of consumers. Thereby they reversed the court of appeals and restored the status quo ante.
No new law was made, either by SCOTUS or the appeals court.
If the publishers feel put upon, they have the constitutional right to petition Congress for euro-style protectionist relief.
Buy enough politicians and they'll be home free.
(Of course, that assumes they buy honest politicians; the kind that stays bought.)