Research Handbook on Intellectual Property Exhaustion and Parallel Imports
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Research Handbook on Intellectual Property Exhaustion and Parallel Imports

Edited by Irene Calboli and Edward Lee

From the Americas to the European Union, Asia-Pacific and Africa, countries around the world are facing increased pressure to clarify the application of intellectual property exhaustion. This wide-ranging Research Handbook explores the questions that pose themselves as a result. Should exhaustion apply at the national, regional, or international level? Should parallel imports be considered lawful imports? Should copyright, patent, and trademark laws follow the same regime? Should countries attempt to harmonize their approaches? To what extent should living matters and self-replicating technologies be subject to the principle of exhaustion? To what extent have the rise of digital goods and the “Internet of things” redefined the concept of exhaustion in cyberspace? The Handbook offers insights to the challenges surrounding these questions and highlights how one answer does not fit all.
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Chapter 27: Digital copyright exhaustion and personal property

Aaron Perzanowski and Jason Schultz


Typically, copyright law is understood as a set of rules that governs intangible expression. But for consumers, copyright law governs the otherwise autonomous and intimate realm of our personal possessions. As invasive as it might seem, copyright law can tell us where we can play our records, to whom we can display our paintings, and whether we can resell our books. And as more and more of our possessions are digital, it can also tell us what devices we can use them on, where we can access them, and with whom we can share them. In this way copyright law serves as both a bridge and a barrier between intellectual and personal property, attempting to balance the competing interests of both regimes.1 For more than a century, copyright law mediated the tension between these two interests through the principle of exhaustion: the rights holder’s power to prevent distributing, using, or sometimes even reproducing a work yields to the personal property interests of consumers once they lawfully acquired a copy of a work. As a result, exhaustion enables libraries to lend their books, museums to display their paintings, and consumers to fill up their bookshelves, borrow DVDs, and back up their software. Rather than an idiosyncratic carve out, exhaustion is an inherent part of copyright law’s balance between the rights of creators and the rights of the public. It is a fundamental component of almost every intellectual property system, one that recognizes that the rights of consumers are not at odds with the goals of the copyright system, but at its core. Meaningful consumer rights to use and transfer personal property are essential to the ultimate goals of the copyright system, public access to, and enjoyment of, new creative works.2 Exhaustion also helps preserve copyright’s legitimacy and lawful markets for copyrighted works by encouraging consumers to pay supra-competitive prices in exchange for the right to use, alienate, and under certain conditions, modify their copy.3

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