How the Supreme Court Could Affect Online Sellers

I read an interesting story the other day that hasn’t gotten much attention in the eBay community yet, but I think it is one that we should all probably pay attention to. It involves a case that is working its way through the federal court system and is expected to be heard by the Supreme Court some time later this month (October).

A few years ago an eBay seller named Supap Kirtsaeng realized that a company called John Wiley & Sons Inc. was manufacturing a certain textbook over in Thailand. This same textbook is also produced in the United States. The textbooks produced there and the textbooks produced here were just about identical except for the small fact that the quality of the Thailand books apparently wasn’t quite as good as the quality of the USA books. The Thailand textbooks also didn’t have the CD-Roms and website passwords that the USA textbooks did. Oh, and there was one other difference I may have failed to mention — the textbooks that were sold over in Thailand, were a whole heck of a lot cheaper than the ones sold here in the United States.

Since Kirtsaeng was a native of Thailand, but was studying in the United States at Cornell University, he became aware that the books from his own country were cheaper. That was when Kirtsaeng got a great idea — have his family and friends buy the books in Thailand and ship them over to him in the United States. He would then take the textbooks and sell them on eBay.

Now, you are probably sitting there reading this and thinking what a brilliant idea! I wish I had thought of that! Oh, did I mention that he had accumulated over 1.2 million in sales? The textbook company, however, wasn’t very happy about these sales. In fact, they decided to sue Kirtsaeng for violating the company’s copyright protections. Unfortunately, a federal court agreed with John Wiley & Sons and in 2011 the federal appeals court upheld this decision. So, now the case is headed to the United States Supreme Court.

While this might just seem like a small blip on the radar for eBay and Amazon sellers, here is the thing that I think we all need to be concerned about. If the Supreme Court upholds the federal appeals court decision, this could mean that every time you want to resell an item produced overseas you would have to get the manufacturer’s permission.

Think about all the electronics sold on eBay and Amazon. Many of them (if not all of them — I’m just saying) are made outside of the United States. This doesn’t just apply to new electronics either, this would also apply to items that you bought and have used. Got an old iPhone 4 you want to sell? You would have to get permission from Apple to do it. Would clothes fall under this ruling? If they are made over seas, it sounds like they could. Certainly, most of the DVDs and probably a good many books we purchase over here originate from across the pond.

Oral arguments on this case are expected for October 29th,  although they say it could take months before a ruling is made. Although I don’t think it is quite time for us to protest outside the courthouse, I do think this is something we should all keep an eye on — just in case.

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