## Facts

- A Dutch company marketed reproductions of visual artworks as paper posters that were first sold in the EU with the rightholders’ consent.
- The company also sold “canvas transfers,” created by chemically transferring the ink layer from a paper poster onto canvas and removing the paper backing.
- The image reproduced on the poster was not changed, but the physical medium was replaced and the original poster ceased to exist as such.
- A Dutch collecting society representing visual artists objected and brought an infringement action, arguing that selling the canvas transfers required new authorization.
- Dutch courts disagreed on whether the EU distribution right was exhausted by the authorized first marketing of the paper posters, and the national supreme court sought a preliminary ruling on the scope of exhaustion.

## Issues

1. Whether exhaustion of the EU distribution right for a lawfully marketed paper poster extends to later marketing of the same reproduced image after the poster’s medium is chemically transferred to canvas and resold.
2. Whether changing the medium of a lawfully sold reproduction results in a “new object” outside the scope of exhaustion under the distribution right.

## Decision

- The court held that exhaustion of the distribution right does not apply where a copy of a protected work, after being marketed with the rightholder’s consent, undergoes an alteration of its medium and is marketed again in its new form.
- Because the canvas transfer process creates a new tangible object incorporating the work, the prior authorized sale of the poster does not exhaust the distribution right for the canvas.
- As a result, selling the canvas transfers required fresh authorization from the rightholders.

## Legal Principles

- Exhaustion of the distribution right is confined to the particular tangible object placed on the EU market with the rightholder’s consent.
- Altering the medium of a copy so that the original object is replaced by a different physical item constitutes the creation of a new object for distribution-right purposes.
- Exhaustion is an exception to exclusivity and is construed narrowly to preserve a high level of protection and appropriate remuneration for authors.
- The relevant “object” is the embodied copy (e.g., poster or canvas), not constituent materials (such as ink) abstracted from that embodiment.
- The analysis concerns distribution of tangible copies, not electronic communication-to-the-public rights; resolution did not require deciding any separate reproduction-right question.

## Conclusion

Exhaustion from the authorized first sale of a physical copy applies only to that specific object; when the medium is replaced through a process that yields a new tangible item, subsequent sales of the new item fall outside exhaustion and require rightholder authorization.


Art & Allposters Int’l BV v. Stichting Pictoright, Case C-419/13 (C.J.E.U. 2015)