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Why Libraries Filed a Brief in a Case About Watches

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LCA Amicus Brief [PDF]

Today the Library Copyright Alliance (whose members are ARL, the American Library Association, and the Association of College and Research Libraries) filed a brief before the Supreme Court in the case of Costco v. Omega. On its face the case is about whether copyright forbids a warehouse retailer from buying wholesale luxury watches abroad. If you dig deeper, though, the case could strike at the heart of what libraries do.

It is worth asking why copyright law is even involved in a dispute between a retailer and a wholesaler where there is no allegation of counterfeit or copying. Copyright enters the picture because Omega attaches a copyrighted logo to its watches, and one of the exclusive rights in § 106 of the Copyright Act is the right of distribution or sale (§ 106(3)). This right doesn’t ordinarily come into play very often because of the “first sale doctrine,” which allows lawful purchasers to turn around and lend or re-sell copyrighted goods in most situations. Nevertheless, when Costco purchased Omega watches abroad and resold the watches in the US, Omega sued, claiming that Costco had made an illegal distribution of the watches by reselling them. Costco argues that the sale is permitted under the first-sale doctrine, but Omega claims that the first-sale doctrine does not apply to works produced abroad. The Court of Appeals for the Ninth Circuit agreed, relying on a statement by Justice Ginsburg in a concurring opinion in the Quality King case that the phrase “works lawfully made under this title” in § 109(a) of the Copyright Act means lawfully made in the US. In other words, the Ninth Circuit held that the first-sale doctrine does not apply to works manufactured abroad.

And that is why this case is important for libraries. In its amicus brief, LCA notes that “[b]y restricting the application of Section 109(a) to copies manufactured in the United States, the Ninth Circuit’s decision threatens the ability of libraries to continue to lend materials in their collections.” There are millions of volumes in library collections that were manufactured abroad. A more precise estimate than “millions” can probably never be known, though, because there is no reliable way of knowing where books in library collections were actually manufactured. So, if the Supreme Court agreed with the Ninth Circuit, and libraries determined that they could not find an alternative to the traditional first sale doctrine rationale for circulating foreign-manufactured works, they would face an impossible task in determining which of their books could not circulate under the new rule.

In the LCA brief, prepared by Jonathan Band, we argue that there are several alternative interpretations of the phrase “lawfully made under this title” that would avoid threatening the core function of libraries. The brief also argues extensively that libraries have a special status under copyright law, and to alter that status would alter the fundamental contours of copyright in ways that implicate constitutional protections, including the First Amendment.

The brief is highly readable and features a lot of great information about the history of libraries and their importance in the copyright policy regime. Check it out.

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