Class 24 Copyright, Winter, 2010 International Issues Randal C. Picker Leffmann Professor of Commercial Law The Law School The University of Chicago Copyright © Randal C. Picker. All Rights Reserved.

November 29, 2015Copyright © Randal C. Picker2 Organizing Domestic and Foreign Markets n Two Examples u DVDs: Technological Separation u Quality King: Legal Separation

November 29, 2015Copyright © Randal C. Picker3 [SC: Amazon Incred US]

November 29, 2015Copyright © Randal C. Picker4 [SC: Amazon Incred UK]

November 29, 2015Copyright © Randal C. Picker5 Comparing Prices n Same DVD u US: $17.99 u UK: £14.99 n Exchange Rate (as of April 21, 2005): $1 = £ , $ = £1 n Matching Prices u $17.99 = £9.37 u £14.99 = $28.77

November 29, 2015Copyright © Randal C. Picker6 [SC: US Encoding]

November 29, 2015Copyright © Randal C. Picker7 [SC: UK Encoding]

November 29, 2015Copyright © Randal C. Picker8 [SC: Amazon on Encoding]

November 29, 2015Copyright © Randal C. Picker Manufacture, importation, and public distribution of certain copies n (a) u Prior to July 1, 1986, and except as provided by subsection (b), the importation into or public distribution in the United States of copies of a work consisting preponderantly of nondramatic literary material that is in the English language and is protected under this title is prohibited unless the portions consisting of such material have been manufactured in the United States or Canada.

November 29, 2015Copyright © Randal C. Picker Infringing importation of copies or phonorecords n (a) u Importation into the United States, without the authority of the owner of copyright under this title, of copies or phonorecords of a work that have been acquired outside the United States is an infringement of the exclusive right to distribute copies or phonorecords under section 106, actionable under section 501.

November 29, 2015Copyright © Randal C. Picker Infringement of copyright n (a) u Anyone who violates any of the exclusive rights of the copyright owner as provided by sections 106 through 121 or of the author as provided in section 106A(a), or who imports copies or phonorecords into the United States in violation of section 602, is an infringer of the copyright or right of the author, as the case may be.

November 29, 2015Copyright © Randal C. Picker12 Quality King n Core Facts u L’anza makes shampoo; labels are copyrighted works u L’anza sells at higher prices in the US than in foreign markets u Quality King acts as middleman to bring shampoo back to US

November 29, 2015Copyright © Randal C. Picker13 Quality King u Ninth Circuit rules for L’anza, saying that applying 109 first-sale defense would gut 602

November 29, 2015Copyright © Randal C. Picker14 Making, Selling, Importing n Hypo: US Printing, Foreign Sale u I print a copyrighted book in the US u I sell copies in the US for $50 u I export copies to the UK and sell them there myself for $25 u Importer buys in the UK for $25, takes the book to the US and sells for $35 n How does Sec. 602 apply to this situation?

November 29, 2015Copyright © Randal C. Picker15 Quality King Result n This is the “round trip” case u Books started in US, left and returned u Under Quality King, 109(a) first-sale rights “attach” w Attach based on location of printing in US— “lawfully made under this title” w That is independent of where the particular copy of the book is sold (see fn. 14 on p.661)

November 29, 2015Copyright © Randal C. Picker16 Making, Selling, Importing n Hypo: Foreign Printing, Foreign Sale u I print a copyrighted book in the US and sell copies in the US for $50 u I print copies in the UK and sell them there for $25 u Importer buys in the UK for $25, takes the book to the US and sells for $35 n How does Sec. 602 apply to this situation?

November 29, 2015Copyright © Randal C. Picker17 Analysis n This is the one-way case u 109(a) doesn’t attach, seemingly, to the books printed in the UK u 602(a) should apply and should block imports n Does this make it possible to enforce price discrimination in this case?

November 29, 2015Copyright © Randal C. Picker18 Analysis u Only way to enforce the across-country price discrimination is by moving the printing overseas n Contrary to US interests?; compare Sec. 601

November 29, 2015Copyright © Randal C. Picker19 602(a) Rewrite n (a) u Importation into the United States, without the authority of the owner of copyright under this title, of copies or phonorecords of a work that have been acquired outside the United States is an infringement of the exclusive right to distribute copies or phonorecords under section 106, actionable under section 501. n How would Quality King come out?

November 29, 2015Copyright © Randal C. Picker20 Analysis n 109 and First-Sale Doctrine u Irrelevant under Rewrite n Overinclusive? u Would cover US tourist buying book in England to read on plane home

November 29, 2015Copyright © Randal C. Picker21 But See 602(a)(2) n This subsection does not apply to ‑ u (2) importation, for the private use of the importer and not for distribution, w by any person with respect to no more than one copy or phonorecord of any one work at any one time, or w by any person arriving from outside the United States with respect to copies or phonorecords forming part of such person’s personal baggage

November 29, 2015Copyright © Randal C. Picker22 Legislative History n From the Congressional Report u Section 602(a) first states the general rule that unauthorized importation is an infringement merely if the copies or phonorecords “have been acquired outside the United States,” but then enumerates three specific exceptions … If none of the three exemptions applies, any unauthorized importer of copies or phonorecords acquired abroad, could be sued for damages and enjoined from making use of them, even before any public distribution in this country has taken place.

Making Copies I n Hypo: Plain Vanilla u Author A writes and publishes book u Buyer buys it at store for $20 u Buyer copies the book and sells copies n Copyright issues? November 29, 2015Copyright © Randal C. Picker23

Making Copies II n Hypo: US, then UK u Author A, a United States citizen, writes and publishes book in the United States u Buyer buys it at store in the US for $20 u Buyer moves to the UK with the book and copies it there and sells copies n Copyright issues? November 29, 2015Copyright © Randal C. Picker24

Answer n Chasing Buyer u Buyer is in the UK as are his assets u Two possible strategies w Path 1: Sue in the US, get judgment there, and take it to UK to sue to get foreign judgment—the US judgment—enforced there w Path 2: Sue in the UK and get judgment there November 29, 2015Copyright © Randal C. Picker25

Answer n Focus on the Differences u Path 1 w US author will be domestic author who published book under US law w Central question in the US case will be one of extraterritoriality: does US law apply to actions taken outside of the US (here the copying in the UK)? See that in Subafilms November 29, 2015Copyright © Randal C. Picker26

Answer w Central question in the follow-on UK case will be about the recognition of foreign judgments (what should a UK court do with a US judgment?) w We see a version of this in Viewfinder Suit brought in France under French law; judgment then brought to the US courts for enforcement November 29, 2015Copyright © Randal C. Picker27

Answer u Path 2 w If Author goes directly to the UK, then the question will be what rights does a foreign author—the US author—have under domestic UK copyright law w That in turn is a question about how the relevant copyright conventions and treaties operate November 29, 2015Copyright © Randal C. Picker28

Answer Berne Convention – Universal Copyright Convention – URL_ID=1814&URL_DO=DO_TOPIC&URL_SECTIO N=201.htmlhttp://portal.unesco.org/culture/en/ev.php- URL_ID=1814&URL_DO=DO_TOPIC&URL_SECTIO N=201.html TRIPs – e.htmhttp:// e.htm WIPO Copyright Treaty – mlhttp:// ml November 29, 2015Copyright © Randal C. Picker29

Answer WIPO Phonograms – US Bilateral Treaties – November 29, 2015Copyright © Randal C. Picker30

Setting Up Viewfinder I n Hypo u Jeff Koons makes an original sculpture u Rogers sees it and takes a photograph of it u Rogers sells the photograph to a third party n Copyright issues? November 29, 2015Copyright © Randal C. Picker31

Setting Up Viewfinder II n Hypo u Jeff Koons sews an original dress u Rogers sees it and takes a photograph of it u Rogers sells the photograph to a third party n Copyright issues? November 29, 2015Copyright © Randal C. Picker32

Viewfinder n Start With u n French Law u uk uk w L w L w L 122-5(3) November 29, 2015Copyright © Randal C. Picker33

US Recognition of Foreign Judgments n nact99/1920_69/ufmjra62.pdf nact99/1920_69/ufmjra62.pdf u Focus on Section IV(B)(3): w “A foreign judgment need not be recognized if … (3) the [cause of action] [claim for relief] on which the judgment is based is repugnant to the public policy of this state;” November 29, 2015Copyright © Randal C. Picker34

Subafilms n Law Design Question u Where should US law apply and why? w In the Making Copies II hypo, should US law apply to the UK violation? Should we rely instead on UK law n More Minor Question u How does the “to authorize” language at the top of 106 influence this? November 29, 2015Copyright © Randal C. Picker35

November 29, 2015Copyright © Randal C. Picker Exclusive rights in copyrighted works n Subject to sections 107 through 121, the owner of copyright under this title has the exclusive rights to do and to authorize any of the following: u (1) to reproduce the copyrighted work in copies or phonorecords; u (2) to prepare derivative works based upon the copyrighted work;