First Sale Doctrine and You

Like me, I know you've definitely contemplated how it is permissible for books and other products to be resold without violating creators' or original owners' intellectual property rights.Why is it okay to sell a book to Half Price Bookstore, who resells it, when the contents of that book belong to a copyright holder? How is it legal for vintage stores to sell branded garments from internationally recognized trademark holders like Nike, complete with the trademarked Swoosh? If car dealerships are independently owned and operated, why are they permitted to sell vehicles that are comprised of many patented parts, bearing trademarked logos and even appearances?

After all, in many of these case, the products have been altered or associated with a new brand. New cars come with post-manufacturer upgrades that don't void warranty or make them any less a version of their original make and model. Some vintage stores have embellished garments or accessories that are still sold using the original product's familiar qualities, using that to add market value. 

Patent law says that assignees have the right to exclude others from making, using, selling, offering for sale in the U.S., or importing into the U.S., their patented inventions. Copyright law grants owners the right to selling copies, performing, exhibiting, displaying, playing recordings of, and distributing reproductions of their work, and authorizing others to do any of those. Trademarks grant businesses the right to use a specific image, phrase, sound, or some other media to identify their brand and product.

These aren't cases of licensing, in which creators or owners allow a third party to use their IP for a fee or some other exchange. 

So why aren't dealerships sent cease and desist notices, clothing resellers taken to court for trademark infringement, and authors/publishers suing second hand book stores for royalties?

What we're looking at here are all cases of first sale doctrine--a legal precedent near and dear to all librarians' hearts (which may also be described as exhaustion when concerning patents). It's an interesting aspect of IP law that can be applied in roughly the same way to patent, trademark, and copyright cases. 

Generally speaking, the specific rights to income from IP for an item stop after the first sale to the general consumer market. 

An important part of this to keep in mind: it is the specific copy or item that first sale doctrine applies to, not the concept or work--the true IP at stake.

In the case of copyright, I can resell a book but not make copies of it, or perform public readings from it, or create a movie based on it. Only that one copy, that particular item, is subject to first sale. 

Similarly, the same applies to products with trademarks appearing on them. Reselling the branded product does not infringe, only reusing the actual trademark separately would. In our example above, applying the Nike Swoosh to the name of a resale store, or using it to represent the store in some way, would be the violation. But carrying products that have the mark is distinct. 

Think of it the same way in terms of patents: a vehicle with patented components is a single instance of that patented technology. The actual patent, or producing more vehicles with the same patented components, is not for sale or distribution.

It is also important to note that first sale doctrine, primarily when applied to trademarks, also stipulates that the re-selling does not negatively impact its value. If the general consumer's goodwill towards a brand is damaged because of the resale, then first sale doctrine may not apply. 

The seller also needs to make it clear, in many cases confirmed by courts, that they are not the actual owner or representatives of any items. That's kind of why "independently owned and operated" gets thrown around a lot (though only one reason). 

To combine those two concepts, if I turn Nike athletic shoes into a pair of sandals, they can't be such poor quality that it reflects negatively on the overall Nike brand. I also can't represent my sandals as something licensed or produced by Nike. It must be very clear that these are Hannah's athletic sandals, sold by Octopeds™ company. [Octopeds™: they're so great, you wanna wear eight!]

Of course, we have to consider that any one of these examples may not go the way I propose them in a court of law. A company like Nike may not look too kindly on someone messing with their products; if they take me to court, they're going to win just because I can't afford to compete with their legal resources.

Also, I'm not a lawyer or a legal expert, so don't quote me or my blog on this. Use the linked pages, they are more authoritative.

Are you confused yet?

Yeah, me too. Let's go look at internet cats or something instead.

Hobbit IP: Permissions there and back again

Here's a fun, (semi-personal) local story about IP for you. The Hobbit Cafe opened in Houston in 1972 as a uniquely vegetarian restaurant for its first decade. During this time, interest in the Hobbit and Lord of The Rings was much more limited--the first of the live action movies did not come out until 2001. [The 1970s animated movies and series, like Ralph Bakshi's, were cool, but not mega-blockbusters, and didn't have the same effect on the IP's value.]

Still, the owners very responsibly obtained permission from the Tolkien estate to use the Hobbit name and related themes. Decor, menu items, and today merchandise prominently feature characters and settings.

My Hobbit shirt from days of employment; I recommend a Smaug design if you want one.

Across the decades, more Lord of the Rings and Hobbit-inspired restaurants and commercial venues opened in Houston, and around the world. Yet clearly, few of them remain today. For example, Rivendell Grill is long gone.

And why is that? 

It's best understood if I first explain some of the franchise ownership rights. Presently, most of those belong to Middle-earth Enterprises (formerly Tolkien Enterprises), which is a division of the Saul Zaentz Company. New Line Cinema and Miramax own the rights to the movies and the related IP.

A really boring image of the copyright record for the first live-action Lord of the Rings movie

The Tolkien estate retains many rights; when they grant licenses, they can select what licensees may use. Integral to this post, their permissions supersede Middle-earth Enterprises.

So, when the franchise was re-licensed and a new film adaptation released, the IP became a much more valuable commodity owners were not inclined to share. Establishments like Rivendell Grill were contacted and told to shut down or change because they violated the rights of the owners of Lord of the Rings and Hobbit concepts.

The oldest but still live mark on record for the Hobbit word mark related to Lord of the Rings

Records of many lawsuits and and legal disputes over Lord of the Rings-themed names for business, especially called Hobbit, are easy to find. Wikipedia lists several, but none of them mention Houstonian entities. Which, fine, we evidently haven't created any notable enough cases, and for a distinct reason.

This next part is sort of "insider info". I mentioned at the start that this was a semi-personal story; the Hobbit Cafe is near and dear to me for a few reasons. I waited tables there as my first paid job out of college, and yeah, I've heard all the jokes about the good my art history degree was doing, thanks. [It's also where my husband and I met. Ask me in person sometime for that fun story, though it is best told with both of us present.] 

It was during my employment that I learned about the fate of so many Lord of the Rings-themed joints. Evidently, in the early 2000s, the holders of certain rights went on a spree, demanding that establishments without their licensing or permission close. The Hobbit Cafe, fortunately, could produce evidence that they had obtained permission to open a restaurant directly from the Tolkien family and estate. The Hobbit Cafe, thanks to their due diligence and respect for IP, was allowed to remain open. 

That's a lesson for all of us to take away from this. Permission was simple enough to procure over 50 years ago, and stands up to major companies' legal forces. 

But on a final note, Hobbit Cafe seems to have never been granted a service mark for their name. Check out the records here.

On a more final note, I'm not endorsing the Hobbit Cafe and neither is anyone else. This is meant only as a tale to help people understand why permission for IP are so important. My husband and I visited the restaurant recently on the day a judge officially tied our knot, and just like you, I think about IP all the time.

Us hamming it up in the cafe on the day in question. I'm protecting his privacy... he hates it when I use his picture

Bill Nye the Patent Guy

Yep, turns out Bill Nye isn't just a fun science educator, TV personality, and proponent of science and logic: he's also a patented inventor. 

I watched a fair bit of Bill Nye the Science Guy as a kid (federal mark registration nos. 5767841, 6016692, 2010276, 1573911, and 1794982); there are some pieces of his show I still recall clearly, more than 25 years later. He blended entertainment and science learning for children in a unique way that was memorable to many people, proven by his continued influence on my generation. [Language warning on that last one.]

It is therefore hardly surprising to learn that he is also the inventor of multiple patents. I could not have been more pleased when I recently learned this. 

And, very appropriately, some of them could have been featured on his show, used to explain science to kids (or even adults). Most notable in that category is US Patent no. 5,515,203 Educational Lens. It could have been on his show, as the patent essentially states in the background information section. That section is the most easily readable in any utility patent I've ever seen, and reflects many of the values and statements we've always heard from Nye: science is for everyone, we can make it interesting and educational for all people of all ages, and simple household items can be used for fun science experiments. Unfortunately, the rest of the patent reads fairly similar to others, relying on jargon and special patent syntax found in no other form of writing. The Educational Lens is Nye's first patent, granted in 1995.

Anyone can make this patent with a few simple objects!

His next most famous patent is not as educational in use nor is it written in plain language in any part. Bill Nye, influenced by what I can only imagine, designed and invented a better toe shoe for ballet dancing en pointe. Patent nos. 6,895,694 and 7,254,904 describe the improvement to the toe shoe that helps increase comfort and reduce injuries frequently incurred in this form of dance. 

A better toe shoe

I'd particularly like to learn if the new toe shoe became a more common model, or if everyone is waiting out the last few years of the patents' enforceable period to start mass producing it. Anyone up to some ballet shoe market research?

Later, Nye and co-inventor Steve Goucher patented a Throwing Technique Trainer (no. 7,771,294). Again, Nye's patent is aimed at helping reduce injuries related to specific functions. In this case, it is mostly focused on baseball, especially pitchers, who eventually have stress injuries from repeated, extreme motions. This training tool doesn't change that, but it does work on mitigating injuries resultant from sloppy or incorrect technique. An ounce of prevention, and all that.  

Learn to throw a baseball correctly with Bill Nye

Finally, there is a design patent no. D399,522 for a digital abacus that I'm 90% certain is also his; I feel like there can only be so many William S. Nyes who live in Seattle, and among those, just one who also likes to invent learning tools. It's a binary number-based abacus, which sounds challenging. He shares invention credit with William M. Pease, also of Seattle.

Binary abacus, anyone?

According to the bio on his website, I'm correct (phew!).

Well, I'm off to fill a Ziploc® bag with water and create an Educational Lens.