More on the First Sale Doctrine

April 3, 2013

In March, the US Supreme Court ruled that the Copyright Act’s First Sale Doctrine applies to copyrighted works lawfully made abroad Kirtsaeng v. John Wiley & Sons, Inc., 2013 WL 1104736.  Now, the Southern District of New York has held the first sale doctrine does not apply to resales of MP3s.  See Capitol Records v. ReDigi, 2013 WL 1286134.

ReDigi, an online music service that sells used digital music files for a reduced price, maintained that it could verify that each MP3 was purchased from a legitimate source, and required the seller to install software that prompted the seller to remove any remaining copy of the song.  The court was not persuaded, however, ruling that ReDigi infringed Capital’s rights to reproduction and distribution by creating new files.  On ReDigi’s First Sale Doctrine defense, the court stated:

 “…the first sale defense is limited to material items, like records, that the copyright owner put into the stream of commerce. Here, ReDigi is not distributing such material items; rather, it is distributing reproductions of the copyrighted code embedded in new material objects, namely, the ReDigi server in Arizona and its users’ hard drives. The first sale defense does not cover this any more than it covered the sale of cassette recordings of vinyl records in a bygone era.”

ADDITIONAL RESEARCH REFERENCES

There’s been a long and robust discussion on the digital first-sale doctrine.  Try this advanced search in secondary sources:

ti,pr(digital and first-sale)

Results include a great survey of the issue from the Journal of the Patent and Trademark Office Society by Jonathan C. Tobin:

Jonathan C. Tobin, Licensing As A Means of Providing Affordability and Accessibility in Digital Markets: Alternatives to A Digital First Sale Doctrine, 93 J. Pat. & Trademark Off. Soc’y 167 (2011)
The article includes a reference to the  2001 report by the Copyright Office to Congress (pdf) addressing the need for a digital first sale doctrine.  This Office’s conclusion looks familiar:
Unlike the traditional circumstances of a first sale transfer, the recipient obtains a new copy, not the same one with which the sender began. Indeed, absent human or technological intervention, the sender retains the source copy. This copying implicates the copyright owner’s reproduction right as well as the distribution right.
Section 109 provides no defense to infringements of the reproduction right. Therefore, when the owner of a lawful copy of a copyrighted work digitally transmits that work in a way that exercises the reproduction right without authorization, section 109 does not provide a defense to infringement.