> This feels like a strange reductio ad absurdum argument in reverse, where the argument isn’t disproven by reducing it: it is instead proven that merchandise and specifically software is sold as copies not as a singular entity. I’m not sure who Sony’s lawyers are trying to appeal to here, or if they just wanted to burn through a few dozen billable hours on an argument that makes no sense.

Unfortunately I think this argument has a bit more merit than you think. There is already copyright precedent that you cannot enjoy first sale rights on digital property (e.g. "a marketplace for used MP3s", or "we'll scan this book and loan it to you and we promise not to touch it until the loan expires"). Physical goods have specific legal rights that the courts have so far refused to extend to digital files[0]. In that legal environment, every digital copy of a work is fundamentally some data combined with permission to make use of copies of that data under some conditions. There are no digital copies, only digital licenses.

But that's merely an argument that third-parties don't get to copy things just because the way they're copying it emulates an act one might do with a physical copy. Where Sony goes off the rails is that they then argue that the only two options can be "a license under our chosen terms" and "complete and total copyright assignment," and then illustrate the absurdity of someone thinking they bought copyright ownership over Resident Evil (which genuinely can't be sold in parallel like this) to argue that the only way Sony can sell games digitally at all is under terms of their own choosing.

A smart judge would see through this and argue that Sony could at least have chosen terms that materially resembled the rights of someone who owned a physical copy. That is, they could have provided a service to allow someone to transfer their license to another PlayStation Network user. But at the same time, the law has a nasty habit of bowing to its best customers[1], and I would not be surprised if the judge just goes along with what Sony says (especially if the plaintiffs don't do a good job rebutting it).

[0] The reasoning for this is that there is no such thing as a digital move. On a computer, "move" is "copy and delete", and the act of making a copy is squarely in the realm of ordinary copyright protection.

[1] See also: the European Commission and California's abject refusal to require games you bought and paid for to continue to work offline.