RIAA says the system makes copies in the process of transferring the music, and thus it is illegal whether or not first sale applies to digital goods: "[The Copyright Act]... does not permit the owner to make another copy, sell the second copy and destroy the original. Thus, even if ReDigi's software and system works as described by ReDigi (i.e. that it deletes the original copy before it makes the sale), ReDigi would still be liable for copyright infringement."
RIAA further requests that all music files currently on ReDigi's servers be quarantined, all likenesses of their artists be removed from ReDigi's website, and that ReDigi turn over all of their sales records so that RIAA can discuss a settlement with them.
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