The judgment was handed down by U.S. District Judge Richard Sullivan, who found in favor of plaintiff Capitol Records' suit against ReDigi, an online marketplace for "digital used music," reports AllThingsD.
While ReDigi offered a number of counter examples to Capitol's copyright assertions, including a first-sale doctrine that allows companies like Netflix to earn profits on the transfer of DVDs, Judge Sullivan was unimpressed. According to the court, there is a clear separation between digital content, like MP3s, and physical content like CDs.
ReDigi acts as an intermediary between people who want to recoup some of the costs associated with buying digital music, and buyers. Transactions are made in the digital domain, or online, with ReDigi taking a certain percentage of each sale for providing the forum and means to transfer.
Judge Sullivan noted in the order that courts have "consistently held that the unauthorized duplication of digital music files over the Internet infringes a copyright owner?s exclusive right to reproduce," though the question as to whether the unauthorized transfer of said music over the internet constitutes "reproduction." Ultimately, the jurist found that such transfer does in fact do so.
It should be noted that "transfer" as it is being argued in the case is not the duplication of songs, but instead the sending of a single asset so that only one file exists before and after the transfer.
The partial summary judgment calls for both parties to file a joint letter by April 12 regarding how to handle remaining issues such as Capitol's performance and display rights as well as ReDigi's secondary infringement of common law copyrights. Also to be discussed are damages, injunctive relief and attorney's fees.