"...unless authorized by the owners of copyright in the sound recording or the owner of copyright in a computer program (including any tape, disk, or other medium embodying such program), and in the case of a sound recording in the musical works embodied therein, neither the owner of a particular phonorecord nor any person in possession of a particular copy of a computer program (including any tape, disk, or other medium embodying such program), may, for the purposes of direct or indirect commercial advantage, dispose of, or authorize the disposal of, the possession of that phonorecord or computer program (including any tape, disk, or other medium embodying such program) by rental, lease, or lending, or by any other act or practice in the nature of rental, lease, or lending./blockquote>
This section is why there are not CD-rental stores in this country but there are DVD-rental stores.
The key question is whether loaning a CD to a friend represents "direct or indirect commercial advantage." Some courts have suggested that avoiding purchasing something is indirect commercial advantage. The fact that the next sentence in the section explicitly authorizes library lending of CDs, something that one would think would not be considered to be "direct or indirect commercial advantage," might lead one to conclude that "indirect commercial advantage" should be read broadly and could exclude some loans to friends.
I would hope that the courts would conclude that loaning a CD to a friend was not an infringing act, but as far as I know, there has been no case law on the matter.
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