A First Sale Legal Hack?

Here?s a little puzzle for the lawyers out there. It?s pretty obviously copyright infringement to buy a legitimate copy of a CD, make a copy, and then give away or sell the copy. But how about the reverse? Millions of people in their 20s and late-30s have large CD collections acquired back in Ye Olden Tymes, when Australopithecus purchased music encoded on shiny plastic discs rather than our modern formats of MP3 and vinyl. Most of those shiny plastic discs are gathering dust in a closet somewhere, having long since been ripped to the hard drives and iPods from which we actually play them. Would it be legal to give away or sell those mouldering original discs while retaining the digital copy you actually listen to? And could the buyer then repeat the process, and on indefinitely?

Intuitively, the answer is: Of course not! That would be indistinguishable, in its practical effect, from the infringing act of selling or distributing an unauthorized copy. It would defy common sense for it to make a difference whether you keep the copy or the original. And when it comes to computer programs, the copyright statute is quite explicit: Archival copies have to be destroyed as soon as one ceases to be the lawful owner of the original purchased copy. On face, you?d think the same principle would have to apply to sound recordings.

Except it?s not obvious from the statute that it does, technically, and a little quick Googling didn?t turn up any cases directly on point. Here?s the probably-too-cute-by-half argument for why there might be a loophole here. The RIAA has been notoriously cagey about this?but even their attorneys have argued before the Supreme Court that the ubiquitous practice of copying a CD you?ve purchased to you hard drive (and from there to your iPod) is a protected Fair Use that doesn?t infringe the exclusive rights of the copyright holder. The Ninth Circuit implicitly relied on the idea that noncommercial copying for personal use is noninfringing in RIAA v. Diamond, which established (over the recording industry?s objections) that MP3 players are, in fact, perfectly legal.

Now the tricky bit. If the CD owner genuinely makes that copy purely for the purpose of personal use?not as step one in a larger plan to later sell the CD?that?s a lawful copy under the statute. The statute still limits the further copying, sale, and distribution of that lawful copy for anything other than personal use. But ?retention? isn?t one of the exclusive rights protected by copyright. Except for the provision covering software backups, there?s nothing explicitly suggesting that a lawful copy can become unlawful without some further triggering action?again, copying, sale, distribution, rental, and so on. Now flip back to the original CD copy sitting in a closet. The owner has a clear right under the First Sale doctrine to sell that particular copy without authorization from the copyright owner. And I can?t find anything explicit in the statute requiring anything be done about lawful copies previously made when the original CD is legally sold or gifted. Obviously if you?re trying to follow the spirit of the law, you?d delete those lawful personal copies when you transferred ownership of your original copy?though that might actually be a trickier than it sounds in a household where music is shared among several people with iPods and laptops. But technically, ?not deleting a copy? doesn?t appear to be an action that violates an exclusive right of reproduction, distribution, or display. And all the other allowances for personal use hinge on whether a particular copy was lawfully made?not lawfully retained. (It?s implicit in the whole idea of a ?backup copy? that one would continue to use it if the original is lost or destroyed, of course, so it can?t be that continued use of the music is contingent on physical possession of the original CD.)

Assuming the appropriate intention on the user?s part, then, there?s no infringement when the personal copy is made?unless we?re prepared to accept that essentially every legal CD owner is either an infringer or listens to their digital copies only at the sufferance of the RIAA, which could revoke permission at any time. Under the First Sale Doctrine, there?s no infringement when the original is sold. And there?s no infringement when the copy is retained, because ?not deleting something? isn?t generally an act of infringement. Your gut says this overall pattern of conduct has to be infringing?even if in practice it would be impossible to police?but it?s hard to actually pinpoint when the infringement happens if you hew strictly to the statute?s definition of infringement.

Since the result is absurd on face, I?m pretty sure this line of argument can?t be right. I?m just not sure where it goes wrong if we?re applying the actual statute and case law, as opposed to our intuitive feelings about what makes sense. Any IP lawyers want to throw me a life vest?

Source: http://www.juliansanchez.com/2012/07/17/a-first-sale-legal-hack/

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