Reselling copies of MP3s you legally purchased violates copyright, according to a ruling made over the weekend by a New York district court judge. The ruling is a victory for Capitol Records, a subsidiary of Vivendi, and marks a devastating loss to ReDigi, a website that lets users resell copies of their legally purchased MP3s. The decision applies only to the New York jurisdiction for now, but could serve as a model for other states, and it's highly unlikely they would rule any differently.
Capitol first sued ReDigi in early 2012, and ReDigi sought to have the case dismissed under the longstanding American "first sale" doctrine, which says that copyright on physical goods applies only through the first time it's sold by the seller to the first customer. After that, the customer may resell a good to anyone else without fear of copyright infringement.
But because in this case ReDigi makes a copy of the songs in question, the judge found that the company was violating Capitol's song copyrights. As the ruling states:
"Capitol did not approve the reproduction or distribution of its copyrighted recordings on ReDigi’s website. Thus, if digital music files are 'reproduce[d]' and 'distribute[d]; on ReDigi’s website, within the meaning of the Copyright Act, Capitol’s copyrights have been infringed."
Now the case proceeds on to the damages phase, where the court will decide how much ReDigi owes Capitol in damages and whether will be shut down entirely. We've reached out to both companies for more information on what they plan to do next and will update when we hear back.
Update: ReDigi has issued a statement on the matter, pointing out that the ruling applies to the 1.0 version of its service, and that the 2.0 iteration — which is currently in operation — is not impacted. We're reproducing the statement in its entirety below.
We are disappointed in Judge Sullivan's ruling regarding ReDigi's 1.0 service technology. For those who are unaware, ReDigi 1.0 was the original beta launch technology, which has been superseded by ReDigi 2.0. The updated service incorporates patent pending "Direct to Cloud Technology" and "Atomic Transfer Technology" that the court stated are not affected by its recent ruling. Judge Sullivan specifically stated that, referring to ReDigi 2.0, "the court will not consider it in this action," and "while ReDigi 2.0, 3.0, or 4.0 may ultimately be deemed to comply with copyright law — a finding that the Court need not and does not now make."
The case has wide ranging, disturbing implications that affect how we as a society will be able to use digital goods.The Order is surprising in light of last month's United States Supreme Courts decision in Kirtsaeng v. Wiley & Sons, which reaffirmed the importance and applicability of the First Sale Doctrine in the United States of America. Also, within the past year the European Court of Justice has also favorably underscored the importance of the "first sale" or the "copyright exhaustion" doctrine and its direct application to digital transactions.
ReDigi will continue to keep its ReDigi 2.0 service running and will appeal the ReDigi 1.0 decision, while supporting the fundamental rights of lawful digital consumers.
Comments
Uhh… who does this?
By kylesethgray on 04.01.13 1:16pm
The concept of reselling MP3s makes my head want to explode.
By mechatricity on 04.01.13 1:17pm
Think of it applied to other digital media which is far more expensive: games, movies and TV shows.
By dagamer34 on 04.01.13 1:33pm
But most video media that you can purchase legally has some kind of DRM associated with it. Most music nowadays doesn’t.
By steinah on 04.01.13 1:38pm
It would be easy especially when you consider other far more expensive content like games are activated. It shouldn’t be an issue to resell your digital copy on a service like Steam since they can just remove the license from your account.
By Brennok on 04.01.13 3:04pm
A Grammy winning or billboard topping album can easily cost more than games, movies, and shows.. And you are comparing a media type to a storage format. MP3’s on cds, dvds, cartridges, or tapes could be sold. But a non video MP3 recording of games, movies, or shows would be subject to this ruling..
By VoxMediaUser620332 on 04.01.13 3:06pm
How about bequeathing your media collection? Just as dubious under the current arrangements.
By cy.starkman on 04.01.13 5:38pm
People buy mp3s?
By DBlair on 04.01.13 1:21pm
Ever heard of iTunes?
By kraytex on 04.01.13 1:24pm
Isn’t that where people keep their pirated music?
By theendofdays on 04.01.13 1:41pm
Or more accurately, Amazon and Google. Technically iTunes is AAC.
By Danrarbc on 04.01.13 1:41pm
iTunes also supports MP3.
By Mcbeese on 04.01.13 2:41pm
But you generally don’t buy it in MP3, which is the point.
By ninnyjams on 04.01.13 2:57pm
Maybe I missed something, but I thought anything new was mostly mp3. I thought happened the same time songs went $1.29.
By BlatantNinja23 on 04.01.13 5:16pm
I’m sure someone else who actually uses it these days can chime in, but I’m under the impression that 256 AAC files are the default/norm.
By ninnyjams on 04.01.13 5:30pm
I recently purchased a track on iTunes and it was 256Kbps AAC at 44.1kHz… As if you really needed confirmation.
By contreramanjaro on 04.01.13 8:11pm
no, what is it. explain it.
By CobraCommandant on 04.01.13 1:53pm
yup I use it for podcasts.
By Brennok on 04.01.13 3:04pm
I bet a couple of tech companies are glad to see those used ebook patents rendered worthless.
By KnownHuman on 04.01.13 1:25pm
I don’t think you read the article…
By theendofdays on 04.01.13 1:41pm
Like someone would actually give up their “original” copies. It takes 3 seconds to duplicate an album. It’s too easy.
By MyWalnutIsATemple on 04.01.13 1:27pm
you can photocopy a physical book then sell the original, but in that case you violated the copyright, not the reseller, basically the problem here is that the service is making a copy, not the owner.
By Sapereaude on 04.01.13 1:47pm
Outstanding Analogy!
By Kangal on 04.01.13 5:30pm
That’s funny because ANY file transfer creates a copy. Even a ‘move’ keeps a copy until the successful move to the new location is confirmed. This contradicts the recent ruling that you can resell software.
By Danrarbc on 04.01.13 1:43pm
Which ruling was that? All of the court cases I know of have held that EULAs effectively prevent that kind of thing… (I’m genuinely interested, and I can’t find a way of saying it that doesn’t come across as snarky…)
By VoxMediaUser604384 on 04.01.13 1:48pm