ReDigi, a company that sought to allow customers to resell "used" copies of digital songs, is up against the ropes after a U.S. District Court judge declared its business model illegal. Judge Richard J. Sullivan says the "first sale doctrine," which allows for the resale of CDs and DVDs, doesn't apply to digital media. Sullivan has ordered ReDigi and Capitol Records, which brought suit against the startup for infringing on its copyright, to submit a plan to settle the case by April 12.