New Technology, New Law? - First Sale in the Digital Context

I recently blogged here on the boost given to the first sale doctrine by the decision of the US Supreme Court allowing parallel imports of books by rejecting a leading publisher’s contention that a book sold by it abroad could not legally be resold in the US.

While the doctrine may seem rather easy to apply in the case of material goods such as books, its applicability in the digital context is certainly tricky territory. The US District Court for the Southern District of New York in Capital Records v. ReDigi Inc was most recently faced with the issue and went on to hold  that the first sale doctrine is limited to material items.

When a book is purchased, the ownership of the copy of the book so purchased vests in the buyer. The first sale doctrine in this case means that the buyer who is now the owner of such a ‘lawfully made’ copy may sell or otherwise dispose of that particular copy in any manner that she wishes.

On the other hand, in the digital context, possession of a copyright protected work or a ‘lawfully made’ copy does not entail ownership of such work. To illustrate, if you buy a copy of The Godfather at a book store, you own the copy by virtue of such lawful possession and you are free to sell it or rent it or even throw it away. However, if you buy a song on itunes, you are only a licensee of the song and have no ownership rights on the song whatsoever. The owners of the original material are only providing you with a license to use such material. To put it simply, if it is digital, you don’t own it.

While it is true that the internet has enabled greater dissemination of copyrighted works across the globe, it has also led to widespread use and dissemination by non-owners without compensation to copyright owners. The dilemma is this- whether to give copyright owners the power to control all copies of their work in the digital sphere OR allow the operation of the first sale doctrine in the digital context and aim to regulate it through technology, by destroying/preventing making of copies.

ReDigi Inc, for instance, devised a system where users could buy or sell downloaded digital music. What was unique is that it allowed only those music files that were legally acquired from itunes to be uploaded using its service. Additionally, the system removed the uploaded file from the hard drive at the time of uploading thus ensuring that sharing and storing on a computer do not occur simultaneously.

Even as one hopes that India will take cue from the US and recognises the first sale doctrine in at least material goods such as books, the struggle faced by Indian courts in its application in the analogue context makes one wonder. There is bound to be a great level of difficulty which judges may face in making decisions where digital content is involved, using laws that were not even devised to be made applicable to such mediums.  

Apart from the much needed change in the law on its applicability to material goods, one also hopes that India undertakes a comprehensive review of its copyright law to fit the needs of an age where digital networks are dominant means of distributing copyrighted works.