![]() Without the principle of exhaustion, the right holders would be allowed to control each and every distribution of each and every physical object incorporating their copyright protected expression, and that could easily lead to anticompetitive results. Furthermore – in some countries, like in the United States of America – this doctrine allows for the public lending by public libraries. This legal instrument serves as the legal basis of second-hand stores, including online portals like eBay. Consequently, since the doctrine of exhaustion excludes the right holder’s control of the downstream commerce, everyone might freely dispose of the property of their unused books, CDs, paintings, etc. Under the theory of exhaustion, the right holders shall tolerate any future – even for-profit – distribution of the original or the copy of their protected subject matter, where the said content was lawfully put into circulation with their consent (that is, by them or by any other authorized person ) through sale or any other form of transfer of ownership. ![]() American and German copyright law around the turn of the 19 th and 20 th centuries. This exclusivity is broken by the doctrine of exhaustion that was developed parallel in the U.S. Under distribution, we traditionally mean the transfer of the ownership of the original work or its copy to the acquirer through sale, gift or barter. One of the exclusive rights granted to right holders is the right of distribution. Exhaustion belongs to the above list of limitations. Further, several types of works are per se exempted from copyright protection. Such an example is the territoriality the copyright term the limits of alienability of economic rights the statutory and compulsory licences free use or fair use /fair dealing. The exclusivity of rights has been broken by several legal instruments. It turned out to be necessary to balance the interests of the right holders and the society (consumers), further – and most recently – the intermediaries (internet access providers, search engines, hosting service providers, aggregators etc.), in order to guarantee the effective operation of this territory of law and businesses related thereto. It has been, however, universally accepted that the interests of the right holders shall be limited in some ways. National legislators were led by their own domestic interests when creating the original set of their copyright systems. Consequently, the paper urges the reconsideration of the norms on exhaustion on the international and EU level. Indeed, there are reasonable arguments in favour of equalizing the resale of works sold in tangible and intangible format. The paper takes the position that the need for digital exhaustion is constantly growing in society and amongst businesses. ![]() On the other hand, the refusal of digital exhaustion in the ReDigi and the audio book/e-book cases might be in accordance with the present wording of copyright law however, they do not necessarily reflect the proper trends of our ages. The UsedSoft preliminary ruling and the subsequent German domestic decisions highlight a special treatment for computer programs. ![]() The author of the present article stresses that the answers given by the respective judges of the referred cases are not the final stop in the discussion. Questions related to the licence versus sale dichotomy the so-called umbrella solution the “new copy theory”, migration of digital copies via the internet the forward-and-delete technology the issue of lex specialis and the theory of functional equivalence are covered later on. Based upon this introduction, the paper turns to the analysis of the doctrine by the pioneer court decisions handed over in the UsedSoft, ReDigi, the German e-book/audio book cases, and the pending Tom Kabinet case from the Netherlands. The purpose of the article is to provide first a doctrinal summary of the concept, rules and policy of exhaustion, first, on the international and EU level, and, later, under the law of the United States. ![]()
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