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The First Sale Doctrine: If I Own It, I Can Sell It

Green traffic light - symbol of first sale doctrine providing go-ahead, defense against IP infringement claim

Copyright and trademark owners typically like to exercise their legal rights as broadly as possible. There is however, a well-known limit to those rights called the “first sale doctrine“.

Actually, they are two separate but similar doctrines. One pertains to copyrights, the other to trademarks:

  • Copyrights17 USC Section 109(a) states, with certain exceptions, that the owner of a lawfully-made copy of a work may sell or dispose of the work. Consent of the copyright owner is not required. So, for example, if you legitimately possess a book or a CD, you may sell it or give it to someone else or throw it into a trash bin.
  • Trademarks – The trademark first sale doctrine is a product of case law rather than statute. In Sebastian International, Inc. v. Longs Drug Stores Corporation, the United States Court of Appeals for the Ninth Circuit wrote: “[W]ith certain well-defined exceptions, the right of a producer to control distribution of its trademarked product does not extend beyond the first sale of the product. Resale by the first purchaser of the original article under the producer’s trademark is neither trademark infringement nor unfair competition.” The exceptions include, for example, stolen or counterfeit goods or goods that have avoided the producer’s quality control systems.

The exceptions are significant. However, in straightforward cases, the first sale doctrine will provide a defense to allegations of copyright or trademark infringement.

Photo credit: stock.xchng

Dana H. Shultz, Attorney at Law +1 510 547-0545 dana [at] danashultz [dot] com
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