The record industry lost a landmark battle last spring, when a court said that merely printing "not for resale" on an unsolicited promo CD does not prevent you from reselling it — and certainly does not prevent me from buying it. The judgement establishes that "first sale" — the legal doctrine that says that once you buy something, it's yours — is still alive and well. This The Legality article unpacks it all for you:
Once again, the music industry overestimated the level of control they should be allowed to maintain over their copyrighted works. Just as when Sony invaded its consumers' privacy by embedding software in CDs and when the five largest music distribution companies illegally corroborated to fix the price of CDs, the music industry has again violated the law. The United States District Court for the Central District of California concluded, via summary judgment, that the purported EULA included by UMG did not create a "license," nor does it allow UMG to retain any control over the promotional CD. UMG gave away these CDs, and those who receive them are free to dispose of them as they see fit. Therefore, the court found, as the legal owner of the CDs in question, Mr. Augusto and Roast Beast Music broke no laws in selling these recordings, and may continue to do so.
At least we can still sell our old CDs… Right?
It depends. While Mr. Augusto enjoys the right to sell his legally owned CDs, questions arise in a number of states as to who can purchase them. The music industry, it seems, is foregoing lawsuits in favor of promoting preventative legislation. Recent legislation in Florida, Utah, Wisconsin, and Rhode Island has made it more difficult to sell used CDs in those states than it is to get a driver's license. In Florida, for example, anyone attempting to sell used CDs to a retailer must present identification and be fingerprinted, and any retailer looking to sell those same CDs must apply for a permit and submit a $10,000 bond with the Department of Agriculture and Human Services. Thankfully, those restrictions do not apply to online or person-to-person sales.