Want To Sell Used Digital Content? Not So Fast

Just two week after the Supreme Court stop a publisher’s attempt to impose tight limits on the ability of purchasers to resell books, a federal judge in New York has reminded us of the limits on our resale rights when it comes to digital products. In Kirtsaeng v. John  Wiley & Sons, the Supreme Court ruled 6-3 that the “first sale” doctrine applies to goods made outside the U.S. and that a purchaser has the right to resell a book no matter where it was published.

Today’s decision by Judge Richard J. Sullivan of the U.S. District Court in Manhattan appears to end the effort by ReDigi to create a market in used digital music. The judge granted Capitol Records’ motion for summary judgment and while he did not immediately issue an injunction against ReDigi’s operations, that seems likely to follow.

The decision is highly technical and turns on a distinction between what copyright law calls a “phonorecord” and a sound recording. If you own a vinyl or CD recording–a phonorecord– you are free to sell it, but not so with a digital copy.  In essence, the judge said that if Congress wants to create a right to resell digital content, it may do so, but absent such action, forget about it: “[T]he Court cannot of its own accord condone the wholesale application of the first sale defense to the digital sphere, particularly when Congress itself has failed to take that step.”