This year marks the two hundredth anniversary of Charles Dickens’ birth. The writer was also a tireless advocate for a global copyright framework. But it did not materialize in his lifetime and the United States did not support it. Therefore, it is perhaps a fitting tribute to Dickens today that the U.S. Supreme Court has turned its attention to international copyright law.
In Golan v. Holder, the Supreme Court recently upheld the constitutionality of an international framework for the protection of intellectual property and reaffirmed America’s commitment to such a framework.1 In addition, the Court has taken under consideration Kirtsaeng v. John Wiley & Sons, a case concerning the extent to which the American copyright holders can compartmentalize the U.S. market for copyrighted works in an increasingly borderless international marketplace.2
History and the Berne Convention
The fact is that, since the death of Charles Dickens nearly a century and a half ago, the United States has evolved from being a rogue copyright nation, to becoming a world leader in cultural exports and a proponent of harmonized and geographically widespread intellectual property laws. The United States passed its first copyright laws in 1790. However, going against the wishes of many writers and composers, including Dickens3, it denied copyright protection for works created by foreign authors4.
The U.S. was paid back in kind: until the end of the nineteenth century, American authors of copyrighted works received no copyright protection abroad. On its face, the law was logical; America was still a developing nation. It was a content consumer rather than producer. So long as free access to foreign works was more valuable than monetizing domestic works, the United States’ policy struck a logical bargain.
Dicken’s vision of a global copyright framework materialized in 1887 with the Berne Convention for the Protection of Literary and Artistic Works.5 At its core, the Berne Convention requires that member nations (i) adopt minimum levels of protections for copyrightable works6, and (ii) that they treat foreign works no worse than domestic works.7
Nevertheless, the United States refused to accede to the Berne Convention for more than one hundred years, offering only piecemeal protection for foreign works. In the meantime, the United States witnessed the birth and expansion of the film, music, and television industries, all of which today dominate the world stage. By 1989, the year the United States finally joined the Berne Convention, the burdens of having to treat foreign works more equitably were outweighed by the benefits of the broader protections American works would now receive abroad.
In 1989, the U.S. was not a model Berne Convention member nation. Article 5(2) prohibits member nations from conditioning copyright protection on procedural formalities. At the time of accession, U.S. copyright law was rife with such formalities, such as notice, registration, and renewal. The U.S. subsequently did away with such formalities, but failed to comply with Article 18 of the Berne Convention, requiring that member nations restore protection to works that had unfairly fallen into the public domain due to noncompliance with formalities.8 The list of such works included many well-known musical works, including compositions by Igor Stravinsky and Dmitri Shostokovitch.
The United States’ noncompliance with Article 18 of the Berne Convention was remedied with the conclusion of the Uruguay Round of Multilateral Trade Negotiations in 1994, which, among other achievements, established the World Trade Organization (WTO), the Dispute Settlement Understanding (DSU), and the Agreement on Trade Related Aspects of Intellectual Property (TRIPS).9 Taken together those three events forced the U.S. to extend the full protection to foreign works mandated by the Berne Convention.10
With its accession to the Berne Convention and ratification of TRIPS, the United States has become a primary stakeholder in global intellectual property protection. It has completed its transformation from a content pirate to producer.
However, these changes have not been without controversy. Since the ratification of TRIPS, the U.S. has amended its copyright laws to automatically restore copyright protection to foreign works that have fallen into the public domain due to failure to comply with statutory formalities imposed by U.S. copyright law, lack of subject matter protection,11 or lack of national eligibility.12 In 2001, a coalition of orchestra conductors, educators, performers, film archivists, and motion picture distributors filed suit against the U.S. government arguing that these changes to the law, which pulled thousands of foreign works out of the public domain and restored their copyright protection, violated Constitutional limits to copyright protection.13
i. Golan v. Holder
That lawsuit was ultimately decided by the Supreme Court in Golan v. Holder. In Golan v. Holder, the Court concluded that the adoption of TRIPS and the Berne Convention was “a signal event.”14 The Court reasoned that, presented with the option of ratifying the most significant set of trade agreements in its history, Congress made “the political choice . . . between leaving the public domain untouched and embracing Berne unstintingly,” and that choice deserved significant deference.15 Having determined that restoring copyright protection to works in the public domain did not violate the “limited time” portion of the Copyright Clause, the Court also included a warning to Congress. Mindful of the problems of ballooning copyright terms, the Court warned Congress not to use restoration of copyrights or term extensions “to move stealthily toward a regime of perpetual copyrights.”16
The Court next turned to the Petitioners’ other argument, that restoring protection to works in the public domain exceeded Congress’ authority because such action did not “promote the Progress of Science.”17 The Court noted that the Petitioners’ argument was fatally flawed insofar as it limited its view of proper promotion to the creation of new works.18 Rather, it was the “dissemination – as opposed to creation” that was the aim of the Copyright Clause.19 The court held that changes to copyright law “[fell] comfortably within Congress’ authority[,] . . . [because a] well-functioning international copyright system would likely encourage the dissemination of future works.”20
The Supreme Court’s decision in Golan v. Holder cannot be overstated. It reaffirms the United States’ commitment to its role in global intellectual property law. It will, of course, open new markets for American authors and allow them to find new licensing avenues abroad.
ii. Kirtsaeng v. John Wiley & Sons
In addition to Golan v. Holder, the Supreme Court is set to render a decision in Kirtsaeng v. John Wiley & Sons, a case involving the metes and bounds of the first sale doctrine and whether the Copyright Act allows U.S. copyright holders to compartmentalize the domestic sale of copyrighted works in an increasingly borderless marketplace.
Section 109(a) of the Copyright Act codifies the long-standing first-sale doctrine, which allows the owner of a copy of a copyrighted work, such as a book, CD, or DVD, to resell that copy without the copyright holder’s permission.21 Absent such a defense, used record stores, book stores, and the like would be engaging in large-scale copyright infringement.22
However, it is unclear whether the first sale doctrine applies to a class of goods known as “grey market goods”, i.e. commodities traded through distribution channels which, while legal, are unofficial, unauthorized, or unintended by the original manufacturer. In Quality King Distributors, Inc. v. L’Anza Research International, Inc., the Supreme Court determined that the first sale doctrine applied to works manufactured in the United States, sold abroad, and then re-imported back into the U.S. (because products that are sold abroad at lower prices could later re-enter the U.S., cannibalizing domestic sales)23.
In Kirtsaeng, the Court must determine whether its decision in Quality King should be expanded to cover copies manufactured abroad. If the Court determines that the Copyright Act mandates that the first sale doctrine be extended to cover copies manufactured abroad, then once a lawfully made copy is sold anywhere in the world, it could be imported into the U.S. without the permission of the copyright holder and without violating the Copyright Act.
It is difficult to predict how the Supreme Court will decide Kirtsaeng, but the fact that the case is even heard is significant. 2012 could indeed be remembered as the year that the United States fulfilled Dickens’ hopes for a common global copyright standard.
By Caz McChrystal
1. See generally, Golan v. Holder, 565 U.S. ___ (2012).
2. See generally, Kirtsaeng v. John Wiley & Sons, Inc., 654 F.3d 210 (2d Cir. 2011), cert. granted, (Apr. 16, 2012) (No. 11-697).
3. Dickens’ scorn for U.S. copyright laws reached a fever pitch in an 1842 letter to the Mayor of Boston in which he wrote:
I have never in my life been so shocked and disgusted, or made so sick and sore at heart, as I have been by the treatment I received here . . . in reference to the International Copyright question. . . . I vow to Heaven that the scorn and indignation I have felt under this unmanly and ungenerous treatment to me an amount of agony such as I have never experienced since my birth.
SIDNEY P. MOSS, CHARLES DICKENS’ QUARREL WITH AMERICA, 9-10 (The Whitstone Publ‟g Co. 1984).
4. Act of May 31, 1790, ch. 15, § 5, 1 Stat. 124. Furthermore, because the Act based protection on citizenship, copyright protection would not even extend to works published in the United States by resident aliens. Id.
5. Berne Convention for the Protection of Literary and Artistic Works of September 9, 1886, reprinted at 828 U.N.T.S. 221 [hereinafter Berne Convention].
6. See, e.g., Berne Convention, Art. 7(1) (requiring that member nations adopt a term protection of at least 50 years post mortem auctoris).
7. Id. at Art. 5(1).
8. Compare Berne Convention Art. 18 with the Berne Convention Implementation Act of 1988, Pub. L. 100-668, 102 Stat. 2853 (Oct. 31, 1988).
9. Marrakesh Agreement Establishing the World Trade Organization, Apr. 15, 1994, 1867 U.N.T.S. 154.
10. The Berne Convention itself lacks any enforcement mechanisms against noncompliant signatory nations, like the U.S. at the time its accession. TRIPS, in contrast, mandates compliance with the Berne Convention, and the WTO and the DSU create an enforcement mechanism.
11. Due to a quirk in American copyright law, sound recordings fixed on or before Valentine’s Day 1972 are not copyrightable subject matter. See generally Caz McChrystal, The Dissonant Tune of International Harmonization and the Domestic Duration of Phonorecord Protection, 8 VANDERBILT J. ENT. TECH. L. 523 (2006).
12. 17 U.S.C. § 104A(h)(6)(C).
13. Specifically, the plaintiffs argued that the changes violated the Constitutional mandate that copyright protection (1) be for a “limited Tim[e]” and (2) “promote the Progress of Science.” U.S. Const. Art. I, §8, cl. 8.
14. Golan, 565 U.S at 19 (page number refers to slip opinion)
15. Id. (citations omitted).
16. Id. at 15.
17. Id. at 20-23.
18. See id. at 20.
19. Id. at 21 (citing Nachbar, Constructing Copyright’s Mythology, 6 Green Bag 2d 37, 44 (2002)).
20. Id. at 22 (citing URAA Joint Hearing 189 (statement of Professor Perlmutter)). The Court also did address the creation of new works, albeit briefly, determining that “[f]ull compliance with Berne . . . would expand the foreign markets available to U.S. authors and invigorate protection against piracy of U.S. works abroad, thereby benefitting copyright-intensive industries stateside and inducing greater investment in the creative process.” Id. (citations omitted).
21. 17 U.S.C. 109(a).
22. 17 U.S.C. 106(3), granting the author of a copyrighted work the exclusive right to “distribute copies or phonorecords of the copyrighted work to the public by sale or other transfer of ownership.”
23. Quality King Distributors, Inc. v. L’Anza Research International, Inc., 523 U.S. 135, 138 (1998).
[i] Quality King Distributors, Inc. v. L’Anza Research International, Inc., 523 U.S. 135, 138 (1998).
[i] 17 U.S.C. 109(a).
[ii] 17 U.S.C. 106(3), granting the author of a copyrighted work the exclusive right to “distribute copies or phonorecords of the copyrighted work to the public by sale or other transfer of ownership.”
[i] Id. at 20-23.
[ii] See id. at 20.
[iii] Id. at 21 (citing Nachbar, Constructing Copyright’s Mythology, 6 Green Bag 2d 37, 44 (2002)).
[iv] Id. at 22 (citing URAA Joint Hearing 189 (statement of Professor Perlmutter)). The Court also did address the creation of new works, albeit briefly, determining that “[f]ull compliance with Berne . . . would expand the foreign markets available to U.S. authors and invigorate protection against piracy of U.S. works abroad, thereby benefitting copyright-intensive industries stateside and inducing greater investment in the creative process.” Id. (citations omitted).