Recording industry trade group asks government to curtail eCommerce piracy.

A copyright is a set of exclusive rights granted to the creator of a new copyrighted work. Copyright law grants the owner of a copyright the exclusive right to reproduce, distribute, display, perform, transmit and make derivative works based on the original work. If someone other than the copyright owner attempts to exercise one of these exclusive rights that can consistent copyright infringement. A copyright owner can protect their copyright by filing a lawsuit in United States Federal District Court. The lawsuit can request that the court impose an injunction on the alleged infringer to stop copyright infringement and that damages be awarded to the copyright owner for infringement which has already occurred.

The rights granted to a copyright owner by copyright law do come with some limitations. The first sale doctrine is one of the specific statutory restrictions which Congress has placed on the exclusive rights of copyright owners. The first sale doctrine, codified at 17 U.S.C. § 109, provides that an individual who knowingly purchases a copy of a copyrighted work from the copyright holder receives the right to sell, display or otherwise dispose of that particular copy, notwithstanding the interests of the copyright owner. The right to distribute ends, however, once the owner has sold that particular copy. See 17 U.S.C. § 109(a) & (c). Restated simply, when you purchase a copy of a copyrighted work the first sale doctrine allows you to resell the copy that you purchased.

The first sale doctrine is intended to protect a consumer’s right to sell property that they have legitimately purchased. The first sale doctrine was codified when massive machines were necessary to reproduce a book or phonograph and shipping was expensive. Computers and the internet drastically changed how copyrighted works are reproduced and distributed. Now it is trivial for an average person with a computer to reproduce a copyrighted work and distribute it across the world. Online eCommerce marketplaces make it much easier for unscrupulous business to sell unauthorized reproductions next to legitimate sellers of authorized copies. There is a growing perception among copyright owners that eCommerce marketplaces are complicit in the sale of counterfeit goods that are masked by legitimate first sale doctrine sales. Normally eCommerce marketplaces are immune from liability for acts, like copyright infringement, committed by sellers that use the eCommerce marketplaces. However, there is an increasing movement to curtail the immunity enjoyed by eCommerce marketplaces.

The Recording Industry Association of America (RIAA) is the trade association that supports and promotes the financial vitality of the major record companies. In support of its mission, the RIAA works to protect the intellectual property rights of artists and music labels; conducts consumer, industry and technical research; and monitors and
reviews state and federal laws, regulations and policies. The RIAA recently sent an open letter to the United States Department of Commerce, asking the regulatory body to implement strong measures that will stop the practice of selling counterfeits and pirated music albums.

To justify the need for increased regulation of eCommerce marketplaces the RIAA submitted several test studies it performed. The RIAA purchased several different products from several different eCommerce marketplaces. The results of these test sales revealed that about 10 to 16% of CDs purchased from various eCommerce marketplaces were counterfeit. 100% of commemorative box sets purchased were counterfeit. The RIAA suggests that counterfeit goods are so common because of how easy it is for anyone to list goods for sale and because of a lack of oversight on the part of the eCommerce marketplace.

To address the issue of counterfeit goods the RIAA suggests that eCommerce marketplaces voluntarily collaborate with the RIAA and other intellectual property stack holders. The RIAA also suggests the possibility of government regulation that would require eCommerce marketplaces to more strictly scrutinize the products sold on their platforms and penalize eCommerce marketplaces that allow counterfeit goods to be sold unchecked.

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