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ReDigi secures patent for “copy-less” digital transfer technology

By | Published on Thursday 30 January 2014


While the copyright legalities of MP3 resale service ReDigi remain very much in the air, the digital start-up has secured a US patent for its “copy-less” digital transaction technology.

As previously reported, ReDigi allows users to resell their digital content, making it an online version of the second hand record shop. But the record industry is pretty certain that such reselling of MP3s constitutes copyright infringement.

In the US much of the debate has centred on the so called ‘first sale’ doctrine, which specifically allows consumers to resell CDs. But the record companies – and in particular former-EMI-now-Universal division Capitol, which has led the legal action here – insist that principle doesn’t apply in the digital domain, because when CDs are transferred no copying takes place, but that’s not the case with MP3 transfers.

Except ReDigi insists that its technology means that no copying actually takes place when digital files are moved from one PC, over the net, to another via its system. And said system ensures the seller won’t have a version of the sold track on their computer post-transaction. Though all that possibly depends on your definition of “copying”. And either way, last year, after initially failing to secure a summary judgement on the matter, EMI got a court ruling in its favour.

Judge Richard Sullivan said: “ReDigi facilitates and profits from the sale of copyrighted commercial recordings, transferred in their entirety, with a likely detrimental impact on the primary market for these goods. It is beside the point that the original phonorecord no longer exists. It matters only that a new phonorecord has been created”.

But fighting on, ReDigi immediately said it would appeal that ruling, and anyway it now had a new version of its technology to which Sullivan’s judgement shouldn’t apply. And that technology has now been patented in the States. ReDigi says that its patent covers “a method for atomic transaction: a cloud-based mechanism that instantaneously transfers an ‘original’ good from one owner to the next, without making a copy”.

According to Computer World, the patent also covers a “verification engine: a mechanism that analyses each digital media file that enters the ReDigi system to ensure that it is legally eligible for resale” and “a removal and monitoring mechanism: a digital management application that helps sellers identify and ensure personal-use copies of the sold media are removed”.

Confirming his company had now secured patents for its content-transfer system, ReDigi founder John Ossenmacher told reporters: “ReDigi’s technology is significant and readily corrects early industry issues that have plagued digital retailing, including piracy, and opens new opportunities that allow consumers to use their digital media as currency for funding new purchases, in some ways transforming digital media analogous to digital bit coins. We are committed to ongoing innovation and ensuring that all parties, including consumers, copyright holders, and those who create the content have the opportunity to benefit greatly from the multi-billion dollar market in digital media that is owned by the consumer”.

The big question now is: if the patent system recognises the existence of “copy-less” technology, is that enough to circumvent copyright rules?

Of course, given that Sullivan explicitly stated that the aforementioned ‘first sale’ doctrine does not apply in digital in his ruling last year, the labels could argue that the terms and conditions of download stores don’t allow MP3 buyers to transfer ownership of the content they buy, oblivious of whether or not any copying takes place. Though while that would put the punters in breach of contract, it wouldn’t necessarily make ReDigi liable in the same way a copyright infringement would.

It remains to be seen what lawyers at Capitol or elsewhere in the music business do next.