business news in context, analysis with attitude

Dow Jones reports that the Supreme Court is hearing a case that revolves around whether Costco “can be held liable for copyright infringement for re-selling luxury Swiss watches it obtained through second-hand sources.”
According to the story, Omega is charging that “Costco violated U.S. copyright law in 2004 by selling Omega Seamaster watches it obtained from third parties who had imported them into the U.S. Costco sold the watches for $1,299, well below Omega's suggested retail price of $1,999. The watches were engraved with a small emblem Omega had registered with the U.S. Copyright Office.”

Costco maintains that Omega cannot “impose limits on how its watches are imported and re-sold once the watchmaker made its first sale of the goods abroad.”

Dow Jones notes that the case could have implications beyond how Costco sells Swiss watches: “The software, publishing, movie and music industries, seeking to protect the strength of their own U.S. copyrights, filed briefs supporting Omega,” while eBay, Google, and other retailing entities have filed briefs supporting Costco.
KC's View: