A US company has come up with software for reselling unwanted digital content – it’s little wonder there is a legal case with a record label not far behind

FOR YEARS people have been selling off their music CDs and even their book collection as an easy way to make some quick money. But with most people’s music collections now being on MP3 files (as in your iTunes collection), and e-books beginning to rival their physical counterpart, what do you do and where do you go when you want to sell off music and books that you have legally bought but now no longer have any need for?

New US company ReDigi has been set up as the modern-day equivalent of the second-hand record store. Its chief executive John Ossenmacher says: “Most lawful users of music and books have hundreds of dollars of lawfully obtained things on their computers and right now the value of that is zero dollars. ReDigi takes zero dollars and we create billions of dollars in wealth overnight.”

Most estimates have it that we typically only ever listen to 20 per cent of our music collection so people with large collections of music on their computer could not only free up disk space but also make money by selling off their unwanted albums/tracks.

Although dealing only with digital music at the moment, ReDigi says it will offer a second-hand e-book store in the near future.

This new ReDigi service is already proving popular in the US, and the company says it is in total compliance with US copyright laws in that it has developed software that enables it to check if the music being offered to them for re-sale was legally obtained in the first instance. According to the company, its software then copies over the digital file to its online store and successfully deletes the original copy on the seller’s computer.

But this week ReDigi found itself in a New York court after being sued by record label EMI. The latter are arguing that the normal legal principle that allows consumers to resell purchased material doesn’t and shouldn’t apply to digital media. EMI’s argument is that unlike a physical CD or book, it is impossible to guarantee all the original copies of the MP3 music file or e-book have been deleted and therefore that people could re-sell their music/books a number of times while retaining copies for themselves. The label wants ReDigi to pay a punitive $150,000 penalty charge for each song it has already sold on.

Court documents show that in discussions with ReDigi, EMI “certainly did not provide any approval of [its] concept” – meaning the ReDigi software that claims to delete all original copies from the seller’s computer.

The ruling in this case could have far-reaching consequences for the entire media industry. What constitutes “ownership” (as in the legal right to sell on) in the digital world is a still a vexed question, mainly due to the fact than all existing copyright laws (whether in the US, the EU or elsewhere) were written before the digital-ownership era.

If you buy an MP3 album from the Amazon site, the online company is quite clear about what you are getting for your money. Its terms and conditions have it that “upon your payment of our fees for digital content, we grant you a non-exclusive, non-transferable right to use the digital content for your personal, non-commercial entertainment use” – the “non-transferable” stricture there being all-important.

Last July there was a court case with certain similarities to the current ReDigi/EMI case. Then, an EU court sided in favour of UsedSoft, a German company that was reselling Oracle software. The court ruling was that “an author of a software cannot oppose the resale of his ‘used’ licences”.

Google has taken a keen interest in the outcome of this current case. According to the BBC, the company has written a letter to the judge arguing that it has a “specific and vital interest” in the outcome.