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Judge makes crucial ruling on the value of “used” MP3s

The ruling threatens the very existence of startup ReDigi, which could owe Capitol Records millions in statutory damages.

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Kevin Collier

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In case you were fervently hoping otherwise, sorry, it’s been settled in court: No, you can’t sell “used” mp3s.

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That’s the decision of Judge Richard Sullivan, who sided with Capitol Records Saturday in its lawsuit against ReDigi. ReDigi at least deserves props for being bold: It offered an “pre-owned digital marketplace” where users could upload songs they’d legally purchased to other users at a discount, and ReDigi would get a cut.

Though he took 18 pages to flesh out his decision, Sullivan’s conclusion was simple: “[T]he sale of digital music files on ReDigi’s website infringes Capitol’s exclusive right of distribution.” ReDigi had hoped to convince the court its business was legal based on the “first-sale doctrine,” which gives customers the right to sell their old books and albums they’d purchased previously.

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But Sullivan noted that didn’t apply to ReDigi, using similar logic that many filesharing advocates use. He said that digital files aren’t literally the same object once transferred online; a song sent over the Internet is invariably a copy.

Sullivan didn’t yet name a price, but given his clear preference for Capitol’s arguments, it appears ReDigi’s very existence is in trouble. Capitol had requested to be compensated up to $150,000 for each track, and listed scores of infringed tracks in its original complaint.

Photo by Hugo90/Flickr

 
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