I went looking for the PACER filing too, and even though there were occasional references to the case number (13-3000, Lee v. Pinkus), I couldn't find it. (Those same references also said the case was in both SDNY District and SDNY Bankruptcy, so I think there may be some issues to be sorted...)
That's protected by the First Sale Doctrine, 17 USC § 109:
"[T]he owner of a particular copy or phonorecord lawfully made under this title, or any person authorized by such owner, is entitled, without the authority of the copyright owner, to sell or otherwise dispose of the possession of that copy or phonorecord."
Of course, the ability to sell or otherwise dispose of a particular copy/phonorecord doesn't equal the ability to make copies and distribute them. So Bob can sell his DVD to Carol, who can sell to Dave, who can sell to Eve, and it's all protected by copyright--but if Eve sells not the DVD but a copy of the content to Fred, that's not protected.
The issue here is that Fred is bound by the same rules of behavior as Bob, even though Alice and Fred never even met, let alone negotiated a contract.
There's a flip side to this, too. In Jacobsen v. Katzer in 2008, the Federal Circuit Court of Appeals ruled that violation of a license such as the Artistic License (or, by extension, the GPL or a Creative Commons license) was not merely a violation of contract, with redress in state court with money only, but a violation of a copyright condition, with redress in federal court and an injunction.
It was a pretty big win for open source licensing.
Will "scifantasy" Frank has not submitted any stories.