Beach Boys/Brian Wilson Promo CD Extravaganza: Legal Victory
Let's celebrate a big legal victory for owners of promo CDs!
As a fan of promo CDs, I've been keeping an eye on a bogus lawsuit filed by UMG records against Troy Augusto. I've blogged about this lawsuit here and here. UMG claimed that Mr. Augusto violated UMG's copyrights by selling promo CDs through internet auctions. The federal district court sided with Mr. Augusto, and UMG appealed the decision to the United States Court of Appeals for the Ninth Circuit.
Today, the Ninth Circuit affirmed the lower court's decision. The court found that:
"UMG dispatched the CDs in a manner that permitted their receipt and retention by the recipients without the recipients accepting the terms of the promotional statements ... UMG's transfer of unlimited possession in the circumstances present here effected a gift or sale within the meaning of the first-sale doctrine, as the district court held ... Because the record here is devoid of any indication that the recipients agreed to a license, there is no evidence to support a conclusion that licenses were established under the terms of the promotional statement ... Accordingly, we conclude that UMG's transfer of possession to the recipients, without meaningful control or even knowledge of the status of the CDs after shipment, accomplished a transfer of title."
The full decision can be found here.
What this means, is that once they leave the record company, promo CDs can be traded, sold, transferred, destroyed, auctioned, bartered, etc. just like any other CD one might obtain. This is an important win for the "first sale doctrine."
Here is the Electronic Frontier Foundations's press release (EFF helped to defend Mr. Augusto):
There are still a few legal maneuvers UMG could take to try to revive their frivolous lawsuit. UMG could try a motion for reconsideration by the three judge panel. Or, UMG could try for en banc review by a larger panel of Ninth Circuit judges. If those don't work, their last resort is to ask the Supreme Court to review the case. However, in all likelihood, this is the end of the road for UMG. This was a completely bogus lawsuit that never should have seen the inside of a courthouse. UMG should just suck it up, take the loss, and move on.