Redigi will lose this case because they’re claiming their software does something it cannot possibly do. There’s no way to prevent people from keeping a copy of the song. there’s too many loopholes available in the technology. The concept itself is interesting and probably should be legal, but the nature of file based property is that all sales are copies, and copying is exactly what copyright law is supposed to control.
It really doesn’t matter that it’s a digital copy v. a physical one. Legally, the principle is the same. You should have the right to sell it. As long as they make a reasonable effort to make sure there is not a copy of it on the computer with a search program or something, that is adequate.
Even with physical CDs, there is no way to ensure you didn’t make a copy of the movie or CD prior to selling it.
There is simply no way to do so. There is no way to ensure you didn’t take a photo of every page of a book before you sold it.
The fact that it’s easier to make a copy with a completely digital copy is irrelevant to the legal principles.
So, what, under your theory, selling of any used CD is now illegal because there could be a copy out there somewhere?
The question really becomes: Can copyright holders hold buyers to the license scheme? Because you do not buy a copy of a track off of iTunes, you pay a one time fee to license a digital copy of it, which you're permitted to do various things with (including burning it to a CD in some cases.)
Does that license survive scrutiny, or is it like every other attempt to use the forced license scheme: A sales technique that has no standing in the court of law.
I think Redigi has a long road ahead of them, but I don't think they'll lose out of hand. They've attempted to do due diligence, which is far more than any used CD seller anywhere does. That example could be what tips the scales in this case.