For Promotional Use Only — Not For Resale
If you have bought Madonna promo releases for your collections, you might be interested in this article from The Record.
Ever gone into a used record store and picked up a CD or LP with this stamped on the cover: “For Promotional Use Only — Not For Resale?” You wanted to buy it but you had a creepy feeling you might be participating in some kind of shady transaction — possibly even illegal. Turns out you weren’t.
This week, the Ninth Circuit Court of Appeals in San Francisco upheld a lower court’s decision that the sale of so-called promo records — usually advance copies of new releases sent to music critics and radio stations by record labels — does NOT violate copyright laws.
The defendant in UMG vs. Augusto, is the case in which the Ninth Circuit ruled this week.
UMG stands for Universal Music Group; Augusto is Troy Augusto. Universal first filed suit against the California resident in 2007. The Electronic Frontier Foundation took up his case and EFF’s Senior Staff Attorney Fred von Lohman was one of his lawyers. He described what Augusto did to get in trouble to NPR’s On the Media in 2007:
“Troy Augusto makes his living basically doing the age-old thing. He buys low and he sells high. He goes to Los Angeles-area record stores, he finds CDs that he recognizes as being collectable, valuable to a certain set of fans, picks those up and resells them on eBay for, he hopes, a profit. And it appears that major record labels — not just Universal — they object to certain promotional CDs being resold. For those auctions on eBay, the labels will send notices to eBay to try to stop those auctions. And Mr. Augusto has, to his credit, stood up for his rights and said, hey, I’m entitled to sell these. I own them. I bought them fair and square. You guys gave them away. The First Sale Doctrine ought to apply.”
The First Sale Doctrine. If the phrase makes your eyes glaze over, von Lohman was succinct in laying out why you should care:
“First Sale is incredibly important if you believe in things like libraries and used-book stores.”
In a nutshell, First Sale means that if you legally acquire a book or recording, you can do anything you want with it except copy it — you can loan or give it to your Mom; donate it to a library; sell it to a friend or to a used book or record store. It’s what allows you to borrow a book from a library. It’s something that copyright holders like publishers and record labels have always despised because stuff is changing hands for free that could be generating sales.
UMG’s case hinged on proving that it still owned the promo CDs. Attorney John T. Mitchell, says it’s important to distinguish between owning the copyright and owning the copy.
“For example, I have a piece of paper here in front of me. If you had a three-line haiku poem that you recited to me with permission to reproduce it onto my piece of paper, I still own that piece of paper. And by law I have a right to give that piece of paper to someone or sell it without your permission because you authorized the reproduction onto my piece of paper and I own the piece of paper and that’s the end of the discussion. The copyright does not reach the distribution of the copy once the copyright owner no longer owns that copy.”
In other words, just like that haiku, a book or a CD is the copy of a copyrighted work and once you’ve legally acquired that copy, you can sell it.
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