Advanced Copyright Issues on the Internet - Fenwick & West LLP

Otherwise, it would in effect be making multiple copies inconsistent with thebalance between copy and copyright owners. 2291Although this argument makes sense in many instances, such as where a buyer haspurchased a copy of a book that is delivered electronically, in other instances the policy choiceswith respect to whether the first sale doctrine should be applied by analogy seem less clear. Onesuch example comprises works that are made available for on-demand usage, such as movies.The copyright owner clearly intends to make such works available only for one time use by therecipient, and any further retransmission or distribution of the work to third parties would cutinto the owner’s on-demand market for the work. Yet depending upon the transmissiontechnology used, a “copy” of the work may be made in whole or in part at the recipient’s end.Indeed, under the MAI case, even the data stored in RAM at the recipient’s computer wouldconstitute a “copy.” It seems less clear that such “copy” should trigger the first sale doctrine andpermit the recipient to further distribute that “copy,” even if the recipient does not retain a copy.As currently codified in Section 109, the first sale doctrine is drafted as an exception tothe distribution right of the copyright holder. However, as discussed earlier, the new rights oftransmission and access under the WIPO treaties are seemingly broader than the currentdistribution right under United States law. An issue therefore arises as to whether the first saledoctrine should prevail over these new rights of transmission and access, in addition to the rightof distribution. Both WIPO treaties contain provisions stating that nothing in them shall affectthe freedom of Contracting Parties to determine the conditions, if any, under which theexhaustion of rights afforded by the treaties will apply after the first sale or other transfer ofownership of the original or a copy of a work with the authorization of the owner. 2292 The WIPOtreaties thus seem to contemplate that the interplay between the doctrine of first sale and the newrights of transmission and access will ultimately be resolved through implementing legislation.Although the implementing legislation in the United States afforded Congress theopportunity to resolve the ambiguities in the scope of the first sale doctrine as applied to theInternet, the DMCA does not address the issue. One of the proposed bills to implement theWIPO treaties, H.R. 3048, would have added the following new subsection (f) to Section 109 ofthe copyright statute with respect to applicability of the first sale doctrine to works in digitalformat:(f) The authorization for use set forth in subsection (a) applies where the ownerof a particular copy or phonorecord in a digital format lawfully made under thistitle, or any person authorized by such owner, performs, displays or distributes thework by means of transmission to a single recipient, if that person erases ordestroys his or her copy or phonorecord at substantially the same time. Thereproduction of the work, to the extent necessary for such performance, display,distribution, is not an infringement.2291 R. Nimmer, Information Law 4.08[2][b], at 4-32 to 4-33 (2001).2292 See Article 6(2) of the WIPO <strong>Copyright</strong> Treaty and Articles 8(2) and 12(2) of the WIPO Performances andPhonograms Treaty.- 500 -