In light of the U.S. Supreme Court’s March 19 decision in Kirtsaeng v. John Wiley & Sons, 133 S. Ct. 1351, companies should review their distribution models and contracts, whether they sell books, music, videos, software licenses or any other products that come with copyrighted labels, or software. Until recently, companies were comfortable they could prevent unauthorized importation of products containing or bearing copyrighted materials based on U.S. copyright law. Intellectual property rights typically enable companies to time international releases and distinguish prices for different territories or regions (in the Europe for example, EEA-wide exhaustion tends to occur after a first sale of a product in any member state of the EEA, the European Economic Area). The United States has consistently opposed international exhaustion in global trade negotiations. However, in Kirtsaeng the court held that copies of books lawfully made and first sold abroad could be imported into the United States and resold without the U.S. copyright owner’s consent.
Supap Kirtsaeng imported books from Thailand and asserted the "first sale doctrine" as a defense when a U.S. copyright owner, John Wiley & Sons Inc., sued him for copyright infringement. Lower courts had rejected the defense based on territoriality considerations: The first sale doctrine did not apply, because the copies were not made in the United States and no authorized first sale had occurred in the U.S. The Supreme Court reversed and found that an authorized first sale outside the U.S. counts, too.
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