ReDigi Plans to Launch a Used eBook Marketplace Soon, Still ReSells Used Digital Music

redigi-5237682[1]It’s been just over a month since ReDigi lost an important copyright infringement lawsuit, but you can’t tell that from the state of their website.

This 2-year-old start up is still running a marketplace where you can resell your digital music, and in the not too distant future they plan to open a similar marketplace where you can resell ebooks as well.

ReDigi happened across my desk yesterday when I learned that they are planning to open a used ebook marketplace this summer. They’re not ready to share many details just yet, but it looks like ReDigi is going to use the same marketplace model that they have been using to sell digital music.

Speaking of which, ReDigi is still running that marketplace for used digital music. I was surprised when I noticed this today; I was under the impression that the decision handed down in late March put the kibosh on the resale of digital music.

The ruling handed down by US District Court Judge Richard Sullivan did say that it was possible to resell the digital music that you had purchased, yes. But the ruling also indicated that in order to do that you had to also sell the physical media that the digital content was sitting on. I (and many other people) assumed that meant that you would have to sell the hard disk containing the file, but that might not be completely true.

ReDigi seems to think they found a loophole in the decision that will let them continue to operate. Or at least I am guessing they found a way to comply with the decision and continue to operate; they have not spelled it out for me.

The clue that tipped me to ReDigi’s loophole is a footnote on one of the webpages on the ReDigi website (here):

redigi

That is an interesting claim, is it not? It certainly does not agree with my understanding of the ruling handed down in March, but I could be wrong.

Here’s my speculation:

Do you see the part where you need to download the ReDigi app before buying the music? I beleive that ReDigi is going to argue that their servers will host the original copy. That would let ReDigi argue that the digital music that is now being sold via their marketplace does not reside on a user’s computer. While users might have copies of the file on their computer, the original copy is regarded as existing on ReDigi’s servers.

That could be what makes it possible for the music file to be sold, or rather instead of selling a file ReDigi will enable a user to sell the space that the file occupies on the ReDigi server. And because the original copy resides on the ReDigi server there will be no copying of the file during the transfer.  This will enable ReDigi to skirt the copying==infringement issue.

If I am correct then ReDigi could be able to operate quite legally (until they lose another lawsuit). And thanks to Judge Sullivan, users are also going to be able to ignore the part of the TOS of iTunes, Amazon, et al, that forbids the end user from transferring the content from to someone else. This also removes the need to get permission from the copyright holder, which I have discussed before.

And that means that it is possible to resell ebooks as well as digital music.

There are a number of problems, of course. The legal argument I laid out in this post is at best fishy.

And DRM could also be an issue. Thanks to the licensing surrounding Kindle DRM and Adobe DE DRM, ReDigi might be blocked from handling the majority of ebooks sold in the US. But this still leaves open the possibility of DRM-free ebooks, and there might even be a way for ReDigi to host their own ebook servers which will store Epubs and PDFs bought by ReDigi users.

Some libraries are doing that already (Douglas County, CO, for example), though I am not sure that ReDigi will be able to do the same. If ReDigi can run their own ebook server then they could possible enable users to resell ebooks to one another. But I am still waiting for confirmation that this is possible.

In any case, the Capitol Records vs ReDigi lawsuit is not a settled issue and it bears watching. I was planning to wait and watch for ReDigi to file an appeal but with this new twist in the case I think that the company deserves closer scrutiny.

9 thoughts on “ReDigi Plans to Launch a Used eBook Marketplace Soon, Still ReSells Used Digital Music

  1. It would be an interesting version of the Aereo argument: the end-user is buying hard drive space (rather than antennas in the case of Aereo) from ReDigi, so they would be free to sell both the music and the hard-drive space that the music resides on to others. That end-users also have it stored on their own devices might be argued as similar to computers needing to store music in RAM temporarily even when streaming. The catch would be that for the analogy to hold, ReDigi would need unique copies of each song for every user that has that song in their collection.

  2. Who is this “lawyer” who suggests that what Redigi is currently doing “flies in the face of the Judge’s decision? Has he read the decision? Especially the part where Judge Sullivan stated that Redigi 2.0 may be legal but he is not deciding that today? How would anyone interpret that to mean that what Redigi is doing “flies in the face” of the decision. I generally enjoy your blog and think your writing is inciteful, but that comment completely missed the mark.

    1. That was private. But since I can’t put a name to it I have to delete it.

      Edit: Just to be clear, the questionable part wasn’t that ReDigi was still operating but my interpretation of how they complied with the ruling.

  3. Clever legal manœuvre, but if the iTunes TOS says you can’t transfer it to someone else, how can they argue that the original is on their servers?

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