Capitol Records, LLC v. ReDigi Inc., 934 F.Supp.2d 640 (S.D.N.Y. 2013)

Capitol Records (CR), a record company, sued ReDigi, which operated an online marketplace for buying and selling pre-owned legally downloaded music, for copyright infringement regarding reproduction and distribution rights in sound recordings owned by CR. The Court held in favour of the plaintiff-copyright holder and rejected ReDigi’s “first sale” and “fair use” defenses. The Court sustained that Redigi's directly infringed CR's copyrights. In particular, the Court held that (1) ReDigi’s making unauthorized transfers of digital music files over the internet was reproduction and distribution for the purpose of copyright protection; (2) the “first sale” doctrine did not cover ReDigi’s distribution of CR’s copyrighted works; (3) ReDigi was also liable for contributory infringement and vicarious infringement of CR’s copyrights.