Copyright Alert: U.S. Supreme Court Reaches a Split Decision in Costco Wholesale Corporation v. Omega S.A.

On December 13th, the U.S. Supreme Court handed down a non decision in Costco Wholesale Corp. v. Omega S.A., a closely watched copyright case that could have potentially resolved an important international copyright issue that sometimes affects gray market goods; that is, whether gray market goods bearing the manufacturer’s copyright qualify under the First Sale doctrine. Unfortunately, because of the nature of the decision, the status quo among the Circuits remains. Specifically, since the court was equally split in the recent Costco decision, it carries no precedential weight, leaving each Court of Appeals where it previously stood. In the 9th Circuit, the decision in Costco that gray market goods may not qualify for First Sale protection under copyright law stands as binding on those courts under its jurisdiction.

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