Department of Commerce Seeking Input on Digital First Sale

digital first saleThere’s going to be a public meeting scheduled for December 12 in Washington D.C., and the U.S. Department of Commerce is seeking public comment from all interested stakeholders on the issue of first sale doctrine and digital files, including ebooks.

According to the notice published in the Federal Register, they, along with the U.S. Patent and Trademark Office and the National Telecommunications and Information Administration, will be considering:

the legal framework for the creation of remixes; the relevance and scope of the first sale doctrine in the digital environment; the appropriate calibration of statutory damages in the contexts of individual file sharers and of secondary liability for large-scale infringement; whether and how the government can facilitate the further development of a robust online licensing environment; and establishing a multi-stakeholder dialogue on improving the operation of the notice and takedown system for removing infringing content from the Internet under the Digital Millennium Copyright Act (DMCA)

The important piece here for TeleRead readers is the part about scope of digital first sale. It’s this doctrine that (theoretically) forbids people from pirating content. First sale does allow users to buy a DVD and gift it to someone. It’s also the doctrine that allows students to sell their textbooks at the end of the semester. Without this doctrine, in theory, a gifter or reseller would have to ask for publisher permission to take those actions. Good thing I don’t have to ask permission before giving someone a DVD!

However, eBooks have been troublesome. First sale doctrine does not give permission for someone to copy a work in its entirety and transfer it to another party. Neither does fair use doctrine. Ebooks effectively can’t be loaned or (potentially) resold without copying. This has led to the  legal battleground between publishers and resellers, with publishers generally arguing that the ease of copying and transferring digital files makes rights holders especially vulnerable to piracy. (Never mind the fact that studies show that increased legal availability of content reduces piracy.)

Lack of first sale protection is the main reason publishers “sell” content under a licensing instead of owning arrangement. It’s also what leads to caps on the number of times library books can be checked out.

I know from comments on past articles that the TeleRead community has strong opinions on both sides of this issue. Well, here’s your chance to make your thoughts known. Public commentary is being accepted via email to: CopyrightComments2013@uspto.gov before the November 13 deadline.

12 Comments on Department of Commerce Seeking Input on Digital First Sale

  1. Regarding, ” Good thing I don’t have to ask permission before giving someone a DVD!” you don’t have to ask permission before giving or lending someone your own loaded Kindle, Nook, or other e-reader, either.

  2. @rowenacherry, it’s not legal currently for me to load up my Kindle with books I’ve purchased and read and then give it to a friend. That violates the licensing agreement. I’m not saying I agree with it, but that’s why commenting on this issue is important.

  3. Juli,
    Can you quote the paragraph from the contract in your purchase of a Kindle that says you cannot lend your Kindle to anyone else? This is quite a revelation, and given that a Kindle is a physical object, I am really surprised that the restrictions you mention could possibly be legal.

  4. Juli,
    If Amazon is forbidding First Sale Doctrine rights to Kindle purchasers, that is a HUGE story. A Kindle is a physical object, not digital, and as such, a purchaser of a Kindle ought to be able to do whatever they wish with it, including lending, gifting, and selling.

    As an author, my view is that a person who buys a license to read an ebook should have the right to read that ebook on any device legally owned, and to do anything they wish with the device…. but they should not be allowed to create extra copies of the digital work for the purposes of publishing or distributing.

    Thank you for casting some light on the situation as you see it.

  5. I don’t believe it is illegal to lend someone your e-reader device so they can read a book or books you loaded on it. Doing that doesn’t constitute piracy because no additional copy is made of the digital file. As an author I would rather everyone buy a separate copy, but I know of a couple, one of whom owns a Kindle and another a Nook. They do, on occasion, buy one version of a book they both want to read and then exchange readers so they can both read it. I don’t think this violates any licensing agreement because no illegal copy of the book is made, simply the exchange of physical objects.

  6. I’m hearing from others that it might be true that Amazon has been able to argue that their physical object is exempt from the First Sale Doctrine (although it is not digital, but a real world, tangible object) because of the way the Kindle is used as a portal.

    How far could this interesting precedent apply? Perhaps my Mac computer, or my ipad, or my ipod, or my Blackberry or iphone should also be exempt from First Sale Doctrine by the same analysis.

  7. @Rowena, you are free to do what you like with your physical Kindle. Correct, it’s a physical object. The books on the Kindle are a different story. I’ll post a follow up story today to explain further. It’s more than I can cover in a comment.

  8. A number of very thoughtful authors believe that if First Sale Doctrine is extended to e-books, it will be impossible for anyone to tell which ebooks are being sold legally online, and which ebooks have been pirated, let alone prove it.

    A change in the law in the USA will affect the copyright of digital content all over the world. Already, musicians, authors, photographers and other creators are being exploited by Big Tech. The only intellectual property protection that Big Tech supports is their own software patents.

  9. Here’s the letter I sent to the Department of Commerce.

    The biggest problem with the resale of “used” e-books is e-book piracy. Some think that cheaper books mean less reason to pirate books and that’s true to a certain extent, but used e-books also mean that authors and publishers will no longer be able to prove that an online copy has been stolen.

    Right now, publishers and authors license their books to specific resellers/distributors like Amazon Kindle, B&N’s Nook, and Smashwords. If a book is available at any other site, the publisher and author know instantly that that book is pirated, and they help the authorities take these sites down.

    These sites are fairly common, and some look like legitimate book-selling sites so the consumer is no wiser that they are buying stolen books. Some of these sites actually sell the books, others are scams which steal credit card information and install viruses on the victim’s computer.

    If e-books are sold used, the scam sites will be able to fly under the legal radar.

    Pirate sites will claim that their books are being given away for free by legal owners so they can continue their dispersal of illegal copies.

    If e-books are sold used and a site or individual can sell thousands of copies of the same ebook by saying that they are selling one used, there will be no way for the author/publisher to prove this. This will essentially make book theft a crime that can’t be punished.

    Even readers who want to do the right things by buying legally won’t be able to tell who is a legitimate reseller and who isn’t.

    Readers looking for bargains will buy illegal books instead of legal ones, the profit margin for authors and publishers which is small now will plummet to the point that publishing will no longer be profitable for anyone, and those who make the money will have done nothing to create books.

    Allowing the sale of used e-books will destroy all value to copyright.

  10. To protect the author, why not require by law a small programmed insert that kills any ebook after 30 days, read or not, and scrambles content if attempt made to remove it or to copy the ebook.
    Make large booksellers responsible to pay royalties on any copies given away free without author/publisher permission, with the exception of limited number of ten or twenty for review and or promotion copies. All others should be purchased by seller in that author should not lose income when sellers use these ebooks to promote their own business.

  11. @Mary, maybe I’m not understanding your suggestion, but, while DRM doesn’t make me happy, something that autokills my book would definitely be a problem. I’ve got a book on my Nook right now that I bought when it went on sale last month and that I’m saving to read on vacation next month. That would put me well beyond the 30 day mark, and I’d be pretty pissed if it was killed before I got around to it.

  12. Everyone should remember that the most important line of Juli’s article is the reminder that, although the meeting has been postponed to December, the deadline for content creators to submit an opinion is tomorrow, November 13th 2013.

    Thanks Juli!

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