Legal Question in Intellectual Property in California

Re: Can sellers prohibit buyers from publicly reselling their products?

The U.S. Copyright Act grants a copyright holder a number of exclusive rights, including, among others, the right to restrict distribution of his/her copyrighted work. However, the Copyright Act also permits a lawful purchaser of a copyrighted work to "resell" that work as long as the resale does not involve alterations or changes to the original work purchased. This is called the "First Sale" doctrine, and it operates as an absolute defense to a copyright infringement action. In other words, a copyright holder could sue someone for infringing his/her exclusive right of distribution, but the defendant would have an absolute defense if he/she merely engaged in resale (whether public or private) of the original work. However, if you originally purchased the copyrighted written materials through the copyright holder's website, or other method, that subjected that purchase to a "contractual" obligation to not engage in public resale, you could be facing a breach of contract suit. Ultimately then, you are faced with raising a defense as to the terms of that contract, if such defense is available, and/or a defense, if available, that essentially states the remedy sought by the breach of contract regarding resale is really a "dressed up" attempt to seek copyright infringement remedies. In the latter case, you might be able to argue that the U.S. Copyright Act governing lawful resales (i.e. First Sale Doctrine) "preempts" the contract claim.

In any event, your best course of action is always to review your specific facts and situation with a qualified attorney to best determine your rights. Generalized advice based on incomplete facts can never replace legal advice from an attorney that has had opportunity to review all pertinent facts and documents that may apply to your situation, and engage in a dialogue with you to determine all issues involved. Good luck.

Re: Can sellers prohibit buyers from publicly reselling their products?

Generally speaking, your question would fall under what is known as the "First Sale" doctrine of copyright. Even though a copyright holder has the right to control distribution (or not) of his/her work, once a physical copy is sold, that copy may be resold or given away by the purchaser and any subsequent purchasers without infringing the copyright holder's rights.

From what you have described, it would seem that the seller is overreaching. It seems he wants to prevent competition, and restrict your transfer of something you have paid for, most likely so that he can charge full price from any potential buyer. The "Terms and Conditions" that were posted when you made your purchase may apply, but they would not necessarily cancel out federal copyright law.

If you want to sell your copy on the web and he interferes with that sale, you may have a claim against him. You should, however, discuss the specifics of your situation with a competent attorney before proceeding. Only by reviewing the actual facts and circumstances that apply to you can an attorney give you reliable advice.