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S P E C I A L : Supreme Court: 1997-1998 Session

Supreme Court rules against exclusive hair product sales

graphic March 9, 1998
Web posted at: 2:33 p.m. EST (1933 GMT)

WASHINGTON (CNN) -- In a decision that may be good news for consumers and bad news for manufacturers, the Supreme Court Monday ruled against a California manufacturer of hair care products which sought to sell its wares in the United States exclusively through hair salons.

The court ruled that once L'anza Research International also sold its products overseas, it lost the exclusivity of its copyright and the right to control its distribution.

Labels on L'anza products are copyrighted under federal law. In the United States, L'anza's products are sold only through authorized distributors such as beauty salons and barber shops.

But L'anza also sells its products to overseas distributors at a discount of 35 to 40 percent, because they do not benefit from the company's U.S. advertising. The company does not authorize international distributors to import the products into the United States.

But the decision says an importer -- in this case, Quality King Distributors -- could legally bring the hair care products back into the United States and sell them to discount marketers which could retail the products, often at lower prices than in the salons.

Although the case involved a small California manufacturer, it was closely watched by manufacturing and retailing giants. Recording, publishing, movie and computer software manufacturers, all of whom claim copyright protection, had taken L'anza's side.

Supporting Quality King's side were Wal-Mart, Costco, Target and other retailers who want access to such goods at the more favorable prices which, the retailers claim, they pass on to their customers.

Court makes other decisions

In other action, the court:

  • Set aside a Baltimore man's conviction and three-year prison sentence for a 1993 beating death, ruling that he was denied a fair trial because a co-defendant's confession was read to the jury.
  • Rejected a former Nevada university professor's arguments that the University of Nevada, Reno, had discriminated against her and violated a federal anti-bias law, when it hired a black sociology professor before her.
  • Refused to revive a program in Dade County, Florida, that boosted the awarding of construction contracts to black-owned companies. The county had argued that discrimination in its local construction industry was severe enough to justify a remedy.
  • Told a federal appeals court to reexamine a sexual-harassment lawsuit against Belleville, Illinois, by twin brothers who say they were tormented during a summer job for the city. A federal judge threw out the lawsuit, but the 7th U.S. Circuit Court of Appeals had reinstated part of it, ruling that the alleged conduct could amount to illegal sexual harassment.
  • Let Syracuse, New York, keep sponsoring the annual display of a Christmas Nativity scene in a public park. The display was challenged as a government endorsement of religion.
  • Agreed to decide whether police need a search warrant before peering through a gap in window blinds to detect possibly illegal behavior. The court will consider reinstating the Minnesota convictions of two men arrested on cocaine charges, after a police officer saw them through an apartment window packaging a powdery substance.
Correspondent Charles Bierbauer contributed to this report.
 
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Supreme Court:
1997-1998 Session


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