by Brendon Nafziger
, DOTmed News Associate Editor | October 18, 2012
A case the U.S. Supreme Court will hear later this month could possibly make it harder for medical equipment remarketers to sell imported equipment.
For more than a century, the "first-sale doctrine" has held for most copyrighted goods, such as books, movies and even software. This means buyers can resell goods they've bought, even if they don't own the copyright on them. This allows, for instance, Blockbuster to sell used DVDs, Gamestop to sell used video games, and Amazon to sell used books.
But on Oct. 29, the Supreme Court will hear oral arguments in Kirtsaeng v. John Wiley & Sons Inc., a case that could mean the doctrine doesn't apply to goods made and sold in a foreign country and then imported here. And, depending on how the court rules, it could have implications for companies that import medical equipment, as manuals and software are usually copyrighted.
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In the case at issue, a Thai native, Supap Kirtsaeng, attending graduate school in the United States, had his parents send him cheaper copies of the textbooks they bought back home. Kirtsaeng would then resell the books to his U.S. classmates for a small profit, according to a Scotusblog summary of the case from earlier this year.
This apparently irked the publisher of the textbooks, John Wiley & Sons Inc, which later took Kirtsaeng to court. A jury found Kirstaeng guilty of violating the publisher's copyright, and liable for nearly $600,000 in damages. The verdict was appealed, but the Second Circuit Court upheld the ruling. According to Scotusblog, the appeals court concurred with the lower court's finding that the first-sale doctrine didn't apply to goods made, and originally sold, abroad.
How it could apply to medical dealers
What does all this mean for medical equipment remarketers? It's not entirely clear, but if the Supreme Court upholds the Second Circuit's ruling, dealers might run into problems with the copyrighted software licenses and instruction manuals for imported medical equipment they're trying to resell, according to Robert Kerwin, legal counsel for the International Association of Medical Equipment Remarketers and Servicers, or IAMERS, a nearly 20-year-old group that represents sellers and servicers of used medical equipment.
For instance, if a hospital in Germany sold imaging equipment to a U.S. importer, it's possible that a manufacturer that owns the copyright on the scanner's software or manual could have, in effect, a "pocket veto" on the sale, he said.
"We think, depending upon the court's decision, it might make it financially challenging for some companies devoted to importing equipment with copyright issues to function," Kerwin told DOTmed News.