| The first sale doctrine only comes into play as a defense to copyright infringement ("Hey, you don't have the right to distribute that DVD on half.com!" "No, I own this copy, so the first sale has already happened and now I can sell my copy as I see fit."). It protects retailers like DVD Fantasium from copyright infringement suits, since they have already purchased the copies from someone else (there was some mention earlier in the thread that DVD Fantasium may have been selling wholesale to Japan-based retailers as well, but is there evidence of that? At any rate, it doesn't matter, because wholesalers would be equally protected from infringement suits). Unless there is some deception going on, the DVD Fantasium announcement specifically mentions licensing agreements, so we're likely outside the realm of copyright law and into contract law, which is an entirely different situation.
(what follows is pure conjecture based on the assumption that a reasonable, contract-based explanation probably exists--I have no clue what the licensing and distribution agreements actually say, I am only making educated guesses)
Funimation has NA distribution rights as per its contracts with the Japanese companies. I would bet those contracts prohibit Funimation from distributing their releases outside NA (they may have separate agreements for other regions, but here we're talking specifically the agreement that gives NA distribution rights). I would be surprised if that agreement did not also charge Funimation with monitoring the exportation from NA to Japan of its R1 releases, or at least prohibit tacitly allowing the importation into Japan of gray markey goods (i.e. selling to a wholesaler or retailer that Funimation knows to be in the business of importing R1 releases into R2). Further, Funimation may (and probably should, because it wants to maintain goodwill with the Japanese companies) request that its distributors, wholesalers, and retailers sign similar agreements. For example, Funimation may pass on its prohibition against distributing outside of NA to its retailers: "I will not sell you copies of my NA releases unless you promise to only sell them in NA." Such a clause may in fact be required by the original licensing agreement. If the distribution agreement does not have a prohibition on passively allowing the copies to be exported to Japan, only on direct sales to Japan, DVD Fantasium might be able to get away with buying the DVDs from another retailer, but think about the mark-up there. DVD Fantasium would have to raise its prices to maintain the same profit margin, etc. I'm only qualified to talk about the law, though, not the economics aspect.
As for why it is only Funimation--I have no clue. Maybe they were the first company to get concerned, maybe one of their Japanese contacts came to them first, who knows? Well, Funimation would know, but they aren't really obligated to tell us. |
