NYT Says: Don’t Let Importers Undercut U.S. Publishers’ Sales

The New York Times published an excellent editorial yesterday that explains how a landmark Supreme Court copyright case could undercut the U.S. information industry. The Times breaks down Kirtsaeng v. Wiley as follows:

At stake in this important and knotty case is whether copyright holders — publishers, filmmakers, musicians and creative artists of all sorts — can sell their copyrighted works abroad at prices different from what they charge in the American market and rely on copyright law to help maintain the separate pricing without having importers profit from the difference.

The case establishes whether the U.S. Copyright Act can be interpreted to allow copyright holders to use sensible market segmentation strategies. SIIA hopes the justices agree that publishers should be able to set lower prices in less-developed countries, without importers snatching their products up and using them to undercut American sales.

This isn’t a new notion–it’s already codified in the Copyright Act. The Times explains:

… the Copyright Act prohibits anyone from importing into the United States copyrighted works without the copyright holder’s approval. That provision would be seriously limited if copies of a work made abroad could be resold by importers in this country without constraint.

When importers exploit discounts that are meant for poor students in undeveloped nations, they aren’t just denying those students an education–they are threatening American publishers’ ability to do business abroad.

For more information, read SIIA’s amicus brief in the case, which defends the view that these purchases violate U.S. copyright law, since the first sale doctrine does not apply to a work made and sold abroad.


Laura Greenback is Communications Director at SIIA. Follow the SIIA Public Policy team at @SIIAPolicy.

SIIA’s Keith Kupferschmid Weighs in on Kirtsaeng v. Wiley on HuffPo Live

SCOTUS was undeterred by Hurricane Sandy yesterday, holding arguments in Kirtsaeng v. Wiley while most of Washington hunkered down for the storm. The landmark case involves the legality of purchasing copyrighted works overseas and selling them here in the U.S. without authorization from the publisher. SIIA’s Keith Kupferschmid joined HuffPo Live to explain how the case threatens the U.S. information industry–wrapping up his segment just minutes before losing power.

Watch the full segment:

The justices seemed fairly split on the case during the argument. Wiley’s counsel, Ted Olson, reiterated a critical point made in SIIA’s amicus brief – that there are many of exceptions in the Copyright Act, including the Fair Use Defense, which can be used to prevent the concerns raised by the appellant.

We believe that the First Sale Doctrine should not apply to materials made and sold overseas. It threatens to severely undermine U.S. companies’ ability to compete in foreign markets. Ultimately, we hope that the Court will be convinced by the very real argument that both publishers and consumers will face direct harm if our markets are allowed to be flooded with copyrighted material that was intended for purchase overseas. American consumers will be defrauded into buying products that may be inferior or otherwise very different from those intended for U.S. markets, while confronting higher prices in the long run. Meanwhile, consumers and students abroad will lose access to valuable U.S. resources that were created for them.


Laura Greenback is Communications Director at SIIA. Follow the SIIA Public Policy team at @SIIAPolicy.

SIIA Weighs in on Supreme Court Arguments in ‘First Sale’ Case – Kirtsaeng v. John Wiley & Co.

Today, the U.S. Supreme Court held arguments in Kirtsaeng v. John Wiley & Co. – a hotly contested case that threatens the U.S. information industry. Last month, SIIA filed an amicus brief in the case, which involves the legality of purchasing copyrighted works overseas and selling them here in the U.S. without authorization from the publisher.

We believe that, if the First Sale Doctrine were to apply to materials made and sold overseas, it would severely undermine U.S. companies’ ability to compete in foreign markets. At today’s Supreme Court argument, the Justices seemed fairly split on the issues. Wiley’s counsel, Ted Olson, reiterated a critical point made in SIIA’s brief – that there are many of exceptions in the Copyright Act, including the Fair Use Defense, which can be used to prevent the concerns raised by the appellant.

Ultimately, we hope that the Court will be convinced by the very real argument that both publishers and consumers will face direct harm if our markets are allowed to be flooded with copyrighted material that was intended for purchase overseas. American consumers will be defrauded into buying products that may be inferior or otherwise very different from those intended for U.S. markets, while confronting higher prices in the long run. Meanwhile, consumers and students abroad will lose access to valuable U.S. resources that were created for them.


Keith Kupferschmid is General Counsel and SVP, Intellectual Property Policy & Enforcement at SIIA.

This Week’s Top IP Enforcement Headlines

White House Unveils New Piracy Awareness Campaign (Reuters)
Attorney General Eric Holder announced a new campaign to raise public awareness about the damaging consequences of intellectual property theft. The campaign will consist of TV public service announcements and print ads and will target everything from illegal music and movie downloads to counterfeit pharmaceuticals.

Grooveshark Responds to Universal’s Copyright Lawsuit (CNET)
Following a lawsuit filed by Universal, in which Universal claims Grooveshark execs led an effort to post more than 100,000 pirated songs onto the music service (previously reported here), Grooveshark responded, stating the lawsuit is based on a “gross mischaracterization of information.”

Judge Orders Google, Facebook to Remove Fake Sites (BBC)
In a case brought by luxury goods maker Chanel against 600 websites, a Nevada judge ordered Google, Facebook, Yahoo, Twitter and others to delist domain names linked to websites selling counterfeit goods.

John Wiley Expands Lawsuit Against File-Sharing ‘Dummies’ (paidContent)
John Wiley filed a new lawsuit against 46 more John Does who were allegedly participating in unauthorized file-sharing of the “For Dummies” series online.

Authorities Seize 131 Domains Associated With Piracy and Counterfeiting (VentureBeat)
Leading up to Cyber Monday, the U.S. government seized 131 domains allegedly associated with counterfeiting and piracy-related websites, signaling authorities have resumed “Operation in Our Sites.”

Hartford Courant Settles Copyright and Hot News Claims (paidContent)
The Hartford Courant quietly settled with the small newspaper that sued it over its news aggregation editor, which means media outlets will not get a further chance to test-drive the controversial “hot news” doctrine in court.

Google Adds More Words to List of Piracy Related Terms (Ubergizmo)
Google has added more words and websites to its list of piracy-related terms, including uTorrent, Bitorrent, and combinations of the word torrent.

Apple Wins Control Over ‘iPhone’ Porn Domain Names (CNET)
Apple has won its dispute with a domain name squatter and dropped the case after the domain name owner agreed to turn over the seven iPhone porn domain names.

Porn Company Sues ICANN Over .xxx Domain (The Wall Street Journal)
Manwin Licensing International, one of the largest purveyors of pornography on the web, filed suit against ICANN to block the new dot-xxx suffix on web addresses, alleging “monopolistic conduct, price gouging, and anticompetitive and unfair practices.”

Copyright Office Declares Priorities, Cybersecurity and Cloud Computing Still a Focus for the Hill

Today, Maria Pallante, the U.S. Register of Copyrights, released a report outlining the Priorities and Special Projects of the U.S. Copyright Office through 2013. The Report articulates 17 priorities in the areas of copyright policy and administrative practice, as well as 10 new projects designed to improve the quality and efficiency of the U.S. Copyright Office’s services in the 21st century. This is the first time in recent history that the Office has published such a document. It provides an excellent roadmap for the most significant legislative, international and administrative copyright issues facing copyright holders and the Office now and into the immediate future.

In other IP news, indications from House leaders are still that the rogue websites legislation is expected to be introduced this week, as early as today. There has been a recent push by opponents of the legislation to stall it’s introduction, including a meeting last week with Cmte. staff where concerns about the potential implications of the bill were discussed.

On the cybersecurity front, the White House held a classified briefing with key Senate leaders last week. The meeting, including representatives from the FBI, DHS, NSA and bipartisan leadership of the Senate committees with jurisdiction over cybersecurity, was part of a continued effort by the White House to advance comprehensive cybersecurity legislation this year. While the meeting participants broadly agreed about the urgent need to address growing cybersecurity threats, there are several key issues that remain unresolved. To state the obvious, the clock is beginning to run out on 2011.

The FTC staff report on privacy is scheduled for release before the end of the year, but it is possible, and even likely, that issuance will go to the beginning of next year. The final report is likely to be very similar to the draft report. It will not be a major overhaul and will not contain any earth-shattering departures from the structure set out earlier. The major issues in play appear to be the definition and role of commonly accepted business, the role of data minimization, the application of privacy framework to both the online and off-line contexts and the distinction between first party and third party providers of online advertising. The report is likely to touch on the multi-stakeholder process that the Commerce Department is looking to establish and be consistent with it, but will focus more on principles and implementation rather than the process of developing self-regulatory codes of conduct. It is not yet clear whether the report will recommend legislation.

And as of last week, “cloud computing” is officially defined. That is, after a long time of working and reviewing, NIST last week released a FINAL version of their official definition of cloud computing, also known as SP 800-145. SIIA has worked with NIST throughout this process, and concur that this is a very solid definition, one that is widely referenced around the world. Of course, it’s breadth underscores why “cloud computing” is so challenging to define for policymaking purposes.


David LeDuc is Senior Director, Public Policy at SIIA. He focuses on e-commerce, privacy, cyber security, cloud computing, open standards, e-government and information policy.

 

DOC/DHS Push for Notice on Botnets and Malware, Supreme Court Hearing Major Copyright Protection Case

At an event hosted by CSIS last week, Cam Kerry, General Counsel of the Commerce Department and Howard Schmidt, Cybersecurity Coordinator for the Obama Administration, emphasized the importance of their recently launched initiative to develop models to advance voluntary corporate notification to consumers regarding the illicit use of computer equipment by botnets and related malware. DHS and DOC/NIST recently issued a notice on the issue, seeking comment on a range of issues relating to how various actors could participate in a multi-stakeholder process designed to reduce these security threats. SIIA is looking to file comments in this proceeding and is seeking input from members. Comments are due on November 4.

Also on the cybersecurity front on Wednesday, the House Republican Cybersecurity Task Force released their formal recommendations. The Task Force was created by House Republican Leadership on June 24th, and asked to provide recommendations to Leadership. As expected, the Recommendations favor many SIIA priorities, such as a narrow definition of “critical infrastructure,” incentive-based approach, rather than regulations, as international collaboration, heavy engagement with the private sector, and providing public awareness regarding threats and existing solutions and best practices. SIIA put out a statement supporting the recommendations and highlighting some of our key priorities.

Importantly, the Recommendations also reiterated the House Republican’s belief that a large, “comprehensive” bill is practical, rather stressing the need for relevant committees to consider legislation separately through regular order. Consistent with this approach, Rep. Goodlatte indicated this week that he will soon introduce a proposal to enhance enforcement of cybercrime.

Also last week, the Supreme Court heard on Wednesday heard oral arguments in Golan v Holder. Before the court was the issue of whether Congress can restore copyright protection to a work whose copyright protection had previously expired and was therefore in the public domain. The court will decided whether the Copyright Clause and/or the First Amendment of the U.S. Constitution prohibit Congress from taking works out of the public domain. SIIA included a detailed summary of the oral arguments in our IP Policy Update.


David LeDuc is Senior Director, Public Policy at SIIA. He focuses on e-commerce, privacy, cyber security, cloud computing, open standards, e-government and information policy.

This week’s IP enforcement headlines

Google Counters Ads for Counterfeit Goods (Information Week)
Google announced in the second half of 2010 it shut down 50,000 accounts for advertising counterfeit goods, and will continue to take additional steps to combat advertising of counterfeit goods through its advertising programs.

Chinese Writers Slam Baidu for Copyright Infringement (Reuters)
China’s top search engine, Baidu Inc., is being accused of copyright infringement by a group of Chinese authors who claim the search engine allows users to post their works online without their consent.

Some More Bad News for Copyright-Enforcer Righthaven (Paid Content))
Righthaven loses a second fair use ruling in a lawsuit against an Oregon non-profit in which U.S. District Judge James Mahan ruled the non-profit’s posting of a full copy of a news article from the Las Vegas Review-Journal was “fair use.”

Court Rejects Google Books Settlement (CNET)
A New York federal district court has rejected a controversial settlement in a class-action lawsuit brought against Google Books by the Authors Guild, in which Google was granted the right to continue a six-year book-scanning project.

Time Warner Cable may be getting itself into a licensing dispute with content providers over its new iPad app, which allows subscribers to view live television channels via the iPad. (PC Mag)
Does Time Warner Cable iPad App Violate its Content Licensing Deals?

Trademark Battles Over “App Store” Continue, as Apple Sues Amazon (Paid Content)
Apple sues Amazon over the use of the phrase “App Store,” which it sees as its trademark and not just a common descriptor.