Current issues of exhaustion of rights (Kirstaeng & Quality King; ReDigi v. UsedSoft)
The paper is based on the author’s keynote power-point presentation made in September 2013 at the ALAI Congress held in Cartagena, Colombia. First, it reviews the international norms that are relevant from the viewpoint of exhaustion of rights. Then, it discusses how the Kirstaeng decision of the U.S. Supreme Court – partly, but not consistently, based on its earlier Quality King decision – got in conflict with the Copyright Act and government policy of the U.S., and what kinds of legal-political consequences it may have. After this, the paper analyzes the reasons for which the preliminary ruling of the Court of Justice of the European Union (CJEU) in the UsedSoft case consisted in no less than de facto modification of the acquis communautaire (to which the Court’s competence does extend). The CJEU introduced “online exhaustion” of the right of distribution (but also of the right of reproduction) which is not allowed under the WIPO Copyright Treaty, the Information Society Directive – and equally not allowed under the Computer Programs Directive (into which the CJEU tried to include lex specialis elements that, in reality, are not part thereof in order to support the legal construction on which its ruling was based). Finally, the paper presents the key aspects of the ReDigi order adopted by the District Court of the Southern District of New York which rightly found that there is no such thing as “digital exhaustion.” The paper is closed by considerations on the possible role of the three-step test with respect to exhaustion as limitation of rights.