Key Takeaways

  • The first sale doctrine allows lawful owners of copyrighted or trademarked goods to resell or dispose of them without the rights holder’s permission.
  • This doctrine applies primarily to physical copies and is limited in digital formats.
  • Trademark law also incorporates the first sale doctrine under specific conditions, provided the resale does not confuse or mislead consumers.
  • Key limitations include restrictions on imported goods and resale of modified items.
  • The future of the doctrine is uncertain amid digital distribution and evolving international trade practices.

First Sale Doctrine

The first sale doctrine provides users of products to lend out or copyrighted works if he or she feels it necessary and useful to do so. 

First Sale: The Basics

The first sale doctrine provides that someone buying a legally produced work that is copyrighted may be able to sell or dispose of the work if he or she believes it to be the best thing to do. For example, if a person purchases a book, first sale lets you have the right to lend the book to a friend.

The first sale doctrine was ratified at the same time as a number of copyrighted products were made tangible. It made it difficult to reproduce these products in large quantities. Owners lobbied Congress for laws that challenged directly or indirectly the first sale doctrine since the onslaught of digital products.

How the First Sale Doctrine Applies to Copyright and Trademark Law

The first sale doctrine is codified under Section 109(a) of the U.S. Copyright Act and provides that the copyright owner’s exclusive right to distribute a particular copy of a work ends after the initial authorized sale. This principle allows consumers to resell or give away legally purchased copies, such as books, DVDs, and software (physical versions).

While the doctrine originated in copyright law, a similar principle is applied under trademark law. Trademark holders typically cannot prevent the resale of genuine goods once those goods have been lawfully sold. However, if the resale causes confusion or misrepresents the origin, quality, or affiliation of the goods, it may trigger liability under trademark infringement or unfair competition claims.

The First Sale Doctrine Is a Narrow Rule

The first sale doctrine is limited and can be applied to a certain copy. No rights are provided regarding the original work. The Copyright Act of 1976 exception aside, the proprietor is not allowed to publish or reproduce without an author’s permission.

One example of the first sale doctrine is a person who owns a book of copyrighted artwork cannot detach the prints and frame or sell them.

It only pertains to the owner of the product, not the person who has the property without ownership. A video store that legally purchased a copy of a movie, for instance, may lend a copy of the movie to a customer. The customer, by law, is not allowed to lend that copy to someone else since the store has the only right to lend it.

Limitations in Trademark Law

In trademark contexts, the first sale doctrine protects resellers of genuine products, but only if the goods remain unchanged and accurately represent the original manufacturer. Key limitations include:

  • Material Differences: If the resold goods differ in a way that affects their quality or presentation (e.g., repackaged, missing warranty), the doctrine may not apply.
  • Quality Control: If the trademark holder uses specific quality control measures and those are circumvented in the resale, the doctrine may not offer protection.
  • Consumer Confusion: If resale suggests a false association with the original producer or implies endorsement, the seller may face liability.

These exceptions protect both the brand's integrity and consumer trust.

Exceptions to the First Sale Doctrine

Renting computer programs and sound recordings is not allowed thanks to the lobbying by the music and computer industries. An exception for sound recordings is only for musical products, not audiobooks.

In the first sale doctrine, the destruction of photographs or fine art that meet the Visual Artists Rights Act requirements is not allowed.

Digital Goods and Software Licensing

The first sale doctrine generally does not apply to digital goods or software licenses. Digital files, such as e-books, music downloads, and software, are often distributed under license agreements rather than sold outright. Because there is no "sale" in the legal sense, the doctrine does not apply, and transferring such files may constitute copyright infringement.

This poses significant challenges to the resale of digital works. Courts have typically sided with copyright holders, affirming that license restrictions override the doctrine in these contexts. Consumers cannot legally resell or transfer downloaded digital media unless the rights holder explicitly allows it.

Goods Made Overseas

No geographic limits are on the first sale doctrine, which was decided by the U.S. Supreme Court in 2013. A case in which a Thai student that came to the United States to study went into business selling books that were purchased by his family in Thailand.

The family then sent the books purchased from Thailand for a low price, while the student sold them at an upcharge. U.S. publishers, stating that the first sale doctrine was not applied to gray market goods, sued that student. This includes lawfully made products that are imported to the United States.

In this case, the Supreme Court did not agree with the United States publishers and ruled for the Thai student. They said that the copies were lawfully made with the permission of the copyright holder. No requirement was needed for the books to be produced in the United States. Therefore, the student can use the first sale doctrine to do anything with his or her own copy of the book, even though he does not own the copyright.

Implications

There is a lower risk of liability faced by companies that manufacture or import any product that included copyrighted works. The Court said that the following made in other countries have copyright software:

  • mobile phones
  • tablets
  • computers
  • vehicles

The decision abolished the exposure for the import and distribution without permission

Trademark Implications for Online Sellers and Resellers

Online platforms, including marketplaces like Amazon and eBay, have amplified the complexities of the first sale doctrine. Sellers should be aware that:

  • Selling genuine branded products is generally protected under the doctrine.
  • If products are imported or altered in any way, the seller may face claims from trademark owners.
  • Some brands use “gray market” claims to target imported goods that are materially different from domestic versions.
  • Resellers must avoid misleading product descriptions, packaging, or marketing that implies affiliation with the brand.

The key to lawful resale is ensuring that the products are authentic, unmodified, and clearly marketed as independent from the brand owner.

The Future of the First Sale Doctrine

The Software and Information Industry Association believes that exploiting pricing points that are designed for students in other nations will pressure the publisher’s ability to business in other countries.

The adoption of new strategies from publishers to respond to profit loss stemming from copyright infringement through resale is a very real issue. The Supreme Court decision can have significant effects on other industries.

Burden of Proof in Infringement Actions

An offender will have the knowledge about how he or she came into possession of the copy and should have the burden of giving this evidence in court. In order to determine if the offender is allowed the privilege established by section 109(a) and (b). They also have the burden of proof of proving if a certain copy was legally made or gained should be on the part of the offender.

Global Trade and the First Sale Doctrine

The 2013 Supreme Court decision in Kirtsaeng v. John Wiley & Sons upheld that the first sale doctrine applies to goods lawfully made abroad. This ruling affirmed that copyright holders cannot restrict the import and resale of legally produced foreign copies.

However, challenges remain in balancing international intellectual property rights and global commerce. Multinational publishers and manufacturers have raised concerns that this broad application may disrupt pricing models and undermine region-specific licensing strategies.

The doctrine’s future will likely continue to be shaped by:

  • Ongoing litigation regarding digital resale.
  • Pressure from industry groups to limit unauthorized imports.
  • Congressional debates about revising IP laws for the digital economy.

Frequently Asked Questions

  1. What does the first sale doctrine allow me to do?
    It allows you to resell, lend, or give away a copyrighted or trademarked item you lawfully purchased, as long as it’s not materially altered.
  2. Does the first sale doctrine apply to digital media?
    No. The doctrine generally does not cover digital media like eBooks or software downloads due to licensing agreements rather than outright sales.
  3. Can I resell imported goods under the first sale doctrine?
    Yes, as long as the goods were lawfully made and sold with the copyright holder’s authorization—even if produced overseas.
  4. How is trademark law affected by the first sale doctrine?
    Trademark law allows resale of genuine products, but exceptions exist if the goods are altered or resold in a way that causes consumer confusion.
  5. What are the risks of reselling branded items online?
    Reselling authentic items is usually allowed, but altering them, skipping quality controls, or misleading consumers can lead to trademark infringement claims.

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