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Thursday, August 01, 2013

Adjunct Joseph Gratz: Does Resale Market for Online Music Violate Copyright Act?

ReDigi says its service is protected by the Copyright Act’s first-sale principle, which would allow people to resell their used CDs at flea markets or online. The doctrine, originally set out by the U.S. Supreme Court in 1908, provides that copyright owners can’t prevent people who have purchased material from reselling it.

But the record industry views the service differently. The major labels contend that ReDigi makes unauthorized copies of MP3s. The industry says that even if first-sale principles let people resell what they have purchased, they can’t sell a copy of that material—regardless of whether it is a homemade recording of an album or an MP3 file.

Despite technology companies’ interest in enabling sales of used digital media, some copyright experts say ReDigi will have an uphill battle. “The standard view is that whenever you’re making a new copy, you’re infringing the reproduction right,” says Joseph Gratz, an adjunct faculty member at the University of California’s Hastings College of the Law in San Francisco. “Making new copies is something that you’re not allowed to do without a license.”

At the same time, Gratz adds, the rationale behind the prohibition on copying is to enable the owner to control the total number of copies in the world. If a system like ReDigi’s deletes the user’s version as it uploads a copy to the company’s servers, the total number of copies in existence remains constant. That’s different from file-sharing services, where countless people can download the same track after one consumer has uploaded it.

Read the full story in the ABA Journal here.

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