While it’s legal in the US to purchase a physical CD or DVD and then resell it to someone else, that’s not the case with digital media. The unauthorized transfer of digital music is considered to be illegal under the Copyright Act of 1976.

And that sentiment was reaffirmed this weekend by US District Court Judge Richard Sullivan, as he ruled in favor of Universal Music Group’s Capitol Records in its lawsuit against digital music reseller ReDigi for copyright violation…

ReDigi, for those who aren’t familiar with it, is an online marketplace for pre-owned digital music. It’s essentially a cloud storage service that gives users a forum to sell their old iTunes songs, and it takes a small percentage of the sale.

The company reportedly sought the advice of a number of legal experts and copyright attorneys before it launched in late 2011. But apparently that wasn’t enough, as Capitol Records filed a lawsuit against ReDigi in January of last year.

And today, AllThingsD reports that Judge Richard Sullivan has finally ruled on the case, siding with Capitol. Sullivan says that unless a copyright owner gives you explicit permission to sell their products, you can’t resell digital media files.

From the ruling:

“Finally, ReDigi feebly argues that the Court’s reading of Section 109(a) would ineffect exclude digital works from the meaning of the statute. (ReDigi Mem. 21.) That is not the case. Section 109(a) still protects a lawful owner’s sale of her “particular” phono record, be it a computer hard disk, iPod, or other memory device onto which the file was originally downloaded. While this limitation clearly presents obstacles to resale that are different from, and perhaps even more onerous than, those involved in the resale of CDs and cassettes, the limitation is hardly absurd – the first sale doctrine was enacted in a world where the ease and speed of data transfer could not have been imagined. “

And that’s the heart of this lawsuit, and probably a number of lawsuits to come: digital media is still very much a grey area for copyright laws—most of which were written in the late 70s. How can you be allowed to resell a CD but not a digital album?

Anyway, this is just a partial judgment. Both parties are to file a joint letter by April 12 regarding how to handle remaining issues like injunction requests and damages. At one time, Capitol Records was asking for ReDigi to pay $150,000 per track sold.

What do you think about reselling digital music? Should it be allowed?