You can sell copyrighted items in some situations and not in others, and the difference matters. Reselling a legitimate copy you bought, like a used book or a game disc, is protected by federal law. Making new products that use someone else’s copyrighted work, or reproducing copies of it, is not, and doing so without a license can trigger statutory damages of up to $150,000 per work infringed.
Reselling Items You Legitimately Own
When you buy a physical copy of a copyrighted work, you own that specific copy. You do not own the underlying copyright, but you can resell, give away, or discard the copy you purchased. This is the first sale doctrine, and it is what makes used bookstores, garage sales, thrift shops, and game trade-ins legal.1Office of the Law Revision Counsel. 17 USC 109 – Limitations on Exclusive Rights: Effect of Transfer of Particular Copy or Phonorecord
The reasoning is simple. Once a copyright holder sells a copy, their right to control what happens to that particular copy is exhausted. They were paid at the first sale. After that, the copy belongs to whoever bought it.
One condition matters: the copy must have been lawfully made and lawfully acquired. Counterfeit, pirated, or stolen items are not protected by the first sale doctrine, no matter how you got them.1Office of the Law Revision Counsel. 17 USC 109 – Limitations on Exclusive Rights: Effect of Transfer of Particular Copy or Phonorecord
Where Resale Rights End
Sellers who assume the first sale doctrine covers everything run into problems fast. It has clear boundaries.
You Can Sell the Copy, Not Reproduce It
Owning a copy lets you sell that copy. It does not let you reproduce the work. You can sell the paperback on your shelf. You cannot photocopy it and sell the copies. Scanning, reprinting, or digitizing an item you own and then selling the reproductions is infringement.
Digital Files Are Usually Licensed
E-books, downloaded music, digital movies, and software bought through online stores almost always come with a license rather than a transfer of ownership. You paid for permission to use the file, not for a copy you own. Because you never owned it, the first sale doctrine does not apply, and reselling would require making a new copy, which infringes the reproduction right.
Courts have reinforced this for software. The Ninth Circuit held that a software user is a licensee rather than an owner when the agreement says it is a license, restricts transfer, and imposes significant use restrictions.2United States Court of Appeals for the Ninth Circuit. Vernor v. Autodesk, Inc. (2010) Most commercial software meets all three tests. Even a boxed disc can come with a license that strips your resale rights.
No Renting Records or Software
The first sale doctrine lets you sell a CD or a boxed software package you own. It does not let you rent them out for profit. Federal law specifically prohibits renting, leasing, or lending sound recordings and computer programs for commercial purposes without the copyright holder’s permission.3Office of the Law Revision Counsel. 17 U.S. Code 109 – Limitations on Exclusive Rights: Effect of Transfer of Particular Copy or Phonorecord Nonprofit libraries and educational institutions are exempt.
Modifications Can Cross a Line
Framing a poster and reselling it is fine. Substantial modifications can be a different matter, because altering a copyrighted work can create a “derivative work,” a right reserved to the copyright holder.4Office of the Law Revision Counsel. 17 USC 106 – Exclusive Rights in Copyrighted Works Federal courts have split on where that line sits, so if you plan to alter a copyrighted item before selling it, the legal risk depends partly on your circuit and how much the change transforms the original.
Making New Products With Copyrighted Material
This is where most online sellers get in trouble. If you make something new that incorporates someone else’s copyrighted work, you need their permission. Printing a movie character on a mug, embroidering a sports team’s logo on a hat, selling artwork that reproduces a copyrighted photograph — each of these involves reproducing the work or creating a derivative, and both are rights the copyright holder controls.4Office of the Law Revision Counsel. 17 USC 106 – Exclusive Rights in Copyrighted Works
Selling these products legally requires a license. Licensing agreements set out how you can use the material, what products you can make, and what royalties you owe. Major entertainment companies and sports leagues maintain licensing programs for this purpose. Fees vary by property and by scale.
A common misconception is that small volume or selling on a marketplace like Etsy falls below some enforcement threshold. There is no such threshold in the law. Selling five infringing mugs carries the same per-work exposure as selling five thousand. Copyright holders use automated detection tools, and small sellers are not exempt from takedowns or lawsuits.
Why Fair Use Rarely Saves a Seller
Sellers who modify copyrighted material sometimes claim fair use. Fair use is a real defense, but it almost never protects someone selling a product commercially. Courts weigh four factors: the purpose and character of the use, the nature of the work, how much was used, and the effect on the market for the original.
The Supreme Court narrowed the first factor in 2023. When an original work and a secondary use share the same or highly similar purposes and the secondary use is commercial, that factor is likely to weigh against fair use.5Supreme Court of the United States. Andy Warhol Foundation for Visual Arts, Inc. v. Goldsmith (2023) The Court said the degree of transformation has to go beyond what would merely make a work a derivative. Putting a filter on a photo or changing the medium does not clear that bar if the new product serves the same market as the original.
Fair use is also an expensive defense. It typically has to be litigated to resolution, and the odds for a commercial seller competing with licensed merchandise are poor.
The Safe Path: Public Domain
Works no longer under copyright belong to everyone. Anyone can reproduce, adapt, and sell them without permission.
Copyright for most published works lasts for the author’s life plus 70 years. For anonymous works, pseudonymous works, and works made for hire, the term is 95 years from publication or 120 years from creation, whichever expires first.6Office of the Law Revision Counsel. 17 U.S. Code 302 – Duration of Copyright: Works Created on or After January 1, 1978 As of January 1, 2026, all works published in 1930 or earlier are in the public domain in the United States. You can print and sell copies of books, illustrations, and sheet music from 1930 and before.
Two cautions. A public domain story can appear in a copyrighted edition with a new introduction, new cover art, or new annotations, and those added elements are still protected. And a character that first appeared in a 1930 work may have later versions still under copyright. You are safe using the character as it appeared in the public domain source, not as it appears in later works.
What Happens If You Get Caught
Consequences escalate quickly, from a delisted product to a six-figure judgment.
Takedowns and Account Loss
Federal law requires online platforms to remove infringing content when they receive a valid takedown notice.7Office of the Law Revision Counsel. 17 U.S. Code 512 – Limitations on Liability Relating to Material Online Major marketplaces layer their own enforcement on top. Your listing disappears, and repeated violations usually lead to suspension or a permanent ban. Losing a primary sales channel can be devastating before a lawsuit ever arrives.
Civil Damages
If a copyright holder sues, a court can award actual damages plus any infringer profits not already reflected in those losses.8Office of the Law Revision Counsel. 17 USC 504 – Remedies for Infringement: Damages and Profits
The copyright holder can choose statutory damages instead. These run from $750 to $30,000 per work infringed, with the court’s discretion inside that range. For willful infringement, the ceiling rises to $150,000 per work.8Office of the Law Revision Counsel. 17 USC 504 – Remedies for Infringement: Damages and Profits “Per work” is the phrase that matters. If your products infringed five different copyrighted designs, each one carries its own statutory range.
The court can also order you to pay the copyright holder’s attorney’s fees and costs.9Office of the Law Revision Counsel. 17 U.S. Code 505 – Remedies for Infringement: Costs and Attorneys Fees In practice that often adds tens of thousands to the total. Statutory damages and attorney’s fees are available only if the copyright was registered before the infringement began, or within three months of first publication.10Office of the Law Revision Counsel. 17 U.S. Code 412 – Registration as Prerequisite to Certain Remedies for Infringement Works from major entertainment companies and publishers are almost always registered, which is why those rights holders pursue statutory damages aggressively.
The Copyright Claims Board
Not every dispute goes to federal court. The Copyright Claims Board, a tribunal inside the U.S. Copyright Office, handles smaller disputes with lower costs and a lighter process. Standard proceedings can award up to $30,000 in total damages. A “smaller claims” track caps damages at $5,000.11U.S. Copyright Office. CCB Handbook – Damages Participation is voluntary, and a respondent has 60 days from service to opt out, which sends the case to federal court if the claimant wants to keep pursuing it.12eCFR. 37 CFR Part 223 – Opt-Out Provisions
Criminal Penalties
Most infringement cases are civil, but willful infringement for commercial gain can be prosecuted as a federal crime.13Office of the Law Revision Counsel. 17 U.S. Code 506 – Criminal Offenses Prosecutors rarely go after small sellers, but counterfeiting operations and piracy rings are prosecuted regularly. A first offense involving at least 10 copies with a retail value above $2,500 carries up to five years in prison. A second offense doubles the maximum to ten years.14Office of the Law Revision Counsel. 18 USC 2319 – Criminal Infringement of a Copyright
How Long the Risk Lasts
A copyright holder has three years from the date the claim accrues to file a civil suit.15Office of the Law Revision Counsel. 17 U.S. Code 507 – Limitations on Actions That clock does not always start at the infringing sale. It can start when the holder discovers or should have discovered the infringement. For sellers who operated quietly for years, recent sales can still be within the window even when older ones are not.