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Watch Freeks > General Watch Discussions > General Watch Discussions: > Watch Out For the Omega Copyright Windup | ||||||
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Watch Freeks > General Watch Discussions > General Watch Discussions: > Watch Out For the Omega Copyright Windup | ||||||
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| Watch Out For the Omega Copyright Windup | Rate Topic |
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| Posted: Sat Jul 31st, 2010 02:46 pm |
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1st Post |
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TVDinner Administrator 
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From the Wall Street Journal -  By ERIC FELTEN Katharine Hepburn couldn't understand why Jimmy Stewart didn't devote himself to his art. Their characters in the 1939 movie, "The Philadelphia Story," are walking back from the local library, where Hepburn has acquired a copy of Stewart's collection of short stories: "When you can do a thing like that book, how can you possibly do anything else?" she asks (knowing that he has sunk to the rank of gossip reporter). "You may not believe this, but there are people that must earn their living," he answers. "Of course," she says, "but people buy books, don't they?" "Not as long as there's a library around." Stewart's hard-scrabble scribbler would be pleased to learn that a Supreme Court case scheduled to be argued in the coming term could put the kibosh on library lending, at least of those books published or printed outside the U.S. In a friend-of-the-court brief, the American Library Association and other library groups argue that a recent Ninth U.S. Circuit Court of Appeals decision "threatens the ability of libraries to continue to lend materials in their collections." The librarians fear they are going to suffer collateral damage from a curious copyright case that has nothing to do with books. It's Costco Wholesale Corporation v. Omega, S.A.—a battle over whether the storied Swiss watch brand can control where and at what price its chronometers are sold in the U.S. Omega, you see, sells its watches for far less money in some countries than in others, a common enough practice known to economists as "geographical price discrimination." The U.S. market will generally bear more than the market in a Latin American republic, and so Omega offers its goods to distributors in places such as Paraguay for less than it does to American distributors. Which is where the grey market comes in. Given the difference in prices, there is a tempting arbitrage opportunity in importing Omega watches from Paraguay to the U.S. It is just such watches that Costco bought from a stateside importer, allowing the warehouse store to offer an Omega Seamaster for $1,299 when the brand preferred them sold in the U.S. for $1,999. Omega eventually sued, after some savvy planning. The company couldn't complain that Costco was peddling fakes—the watches were authentic goods. Nor did U.S. trademark law give the Swiss company the power it needed to block the sales. And so Omega crafted a copyright strategy. They fashioned a small globe logo and copyrighted the device in the U.S. By engraving the tiny logo on the back of the watch, Omega could claim that it created a copyright in the watch as a whole, one that would give the company more control over when and where the watches are sold. The appeals court ultimately agreed with Omega, and in so doing limited a long-standing principle of U.S. law known as the "first sale doctrine." The doctrine holds that, once a copyright holder sells a copy of his work, he loses any say in what the buyer can do with that particular copy. That doesn't mean making extra copies—by buying a book I don't gain the right to publish a new edition of it. But I can turn around and sell my copy of that book to whomever I choose without having to acquire the permission of the copyright holder. The appeals judges decided that, since the first sale of the Omega watches in question happened outside of the U.S., America's first-sale doctrine doesn't apply. It is a small technicality that, in a global economy, could have large implications. Constrain the first-sale doctrine and you throw a wrench into the business of used-book stores, garage sales (including the electronic garage sale that is eBay), and any and every sort of secondhand shop. And yes, even public libraries might find themselves facing the challenge of figuring out which books on the stacks were first sold in the U.S., and which were first sold abroad. No doubt Omega was smart to turn to copyright law, given what an increasingly powerful tool it is. The number of years copyright lasts has been repeatedly lengthened, and juries have been known to hand down fines in the millions for illegally downloading a few dozen songs. The strange and logically contradictory thing, though, is that copyright has been gaining in power at the very same time it has been rendered impotent. Some critics, such as Harvard law professor Lawrence Lessig, argue that copyright has become an oppressive behemoth; others, such as novelist Mark Helprin, lament that the old circle-c is being turned into a dead letter. They are both right. In response to rampant violation of copyright, the entertainment industry, publishers and other such businesses have gotten Congress to beef up intellectual property protections. But "the worldwide copying machine called the Internet," as Suffolk University professor of law Stephen Michael McJohn puts it, continues to hum along, undeterred. The result, says Mr. McJohn, is a bizarre legal disconnect: "Almost everything is copyrightable, and almost everything is used without regard for copyright." Those beefed-up protections seem to have done little to help writers, musicians, publishers and record companies struggling to survive the digital onslaught. It would be a shame if copyright, in its weirdly infirm ascendancy, becomes little more than a vehicle for selling watches on the cheap in Paraguay SOURCE
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| Posted: Sat Jul 31st, 2010 03:29 pm |
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2nd Post |
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Seattle Zen Mod 
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It's an interesting topic and one that plays a role in all facets of distribution. We deal with it on regular basis in my industry. On one hand I agree that once purchased an item is the property of the purchaser and can be done with whatever they want. On the other hand there is a fine line that defines "whatever they want". Can they sell it once purchased to anyone for any amount....one would think but there are issues of degrading the perceived value of said item. Does the new owner have the right to negatively effect the perception of the manufacturer's product, no. On the other hand and in this case does the manufacturer have the right to sell products at different price points in different parts of the world, yes. But does it make it "right", no. It's their product, they can sell for what they want but on the other hand they want to control how and what the purchaser of the item sells it for....confused yet?? After 20 years of marketing I have come to understand that there is no one answer that satisfies everyone. Manufacturers want full control of their product before, during and after the sale. The purchaser wants full control of any item they purchase after the sale. Omega clearly used the laws and a technicality to their advantage. CJ
____________________ CJ  Life is short, enjoy the moment(s) |
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| Posted: Sat Jul 31st, 2010 04:23 pm |
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3rd Post |
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Watchlizard Member Tonkin Gulf Yacht Club 
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Omega clearly used the laws and a technicality to their advantage. IMHO this will not stand on appeal. Appeals courts tend to look more narrowly at issues and the law, where as the Supreme Court tends to look at issues more broadly, including their impact on the rights of everyone, not just the plaintiff. That is assuming SCOTUS agrees to hear the case.
____________________ Freedom is never free....   
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| Posted: Sat Jul 31st, 2010 07:30 pm |
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4th Post |
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cincinnati Chris 
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I believe in the "first sale doctrine".Honestly I cant believe Omega won that case.Must have had a better law team...Imagine if Invicta did that. O Lord...
____________________ Chris... |
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| Posted: Sat Jul 31st, 2010 08:09 pm |
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5th Post |
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djpop Watch Fan 
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Iam sure this will go to court as to many things are effected.
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