Thanks for the clarification. However, I still believe the format shift from MP3 to CD is still a relatively trivial matter, assuming that you did this for your own personal convenience, and not because you intended to give it to your client. In other words, if the making of the CD and the act of lending were two separate and unconnected acts, then the copying per se remains trivial.
However as it was the infringing copy (on CD) which you lent rather than the original, then that does introduce a second infringing act, namely issuing a copy of an infringing work to the public contrary to section 18:
(The reference to Section 18A concerning rental or lending does not apply to your act of lending, as it refers to lending through 'an establishment which is accessible to the public' - in other words, a public library.)
18 Infringement by issue of copies to the public.
(1) The issue to the public of copies of the work is an act restricted by the copyright in every description of copyright work.
(2) References in this Part to the issue to the public of copies of a work are to—
- (a) the act of putting into circulation in the EEA copies not previously put into circulation in the EEA by or with the consent of the copyright owner, or
(b) the act of putting into circulation outside the EEA copies not previously put into circulation in the EEA or elsewhere.
(3) References in this Part to the issue to the public of copies of a work do not include—
- (a) any subsequent distribution, sale, hiring or loan of copies previously put into circulation (but see section 18A: infringement by rental or lending), or
(b) any subsequent importation of such copies into the United Kingdom or another EEA state,
except so far as paragraph (a) of subsection (2) applies to putting into circulation in the EEA copies previously put into circulation outside the EEA.
(4) References in this Part to the issue of copies of a work include the issue of the original.
Obviously in your case it was 'copy' not 'copies', but unfortunately your client still constitutes 'the public' in this instance.
So that's what the law says, and once again I do not think this would or should ever come to court. You have clearly indicated to the supplier that you were in the wrong, albeit perhaps unknowingly, and you are willing to make amends, so I'm sure a satisfactory settlement can be arranged once you have convinced him that this was a one-off event.
As for his stated intention to contact your professional body and the threatening tone of his letter, these could count in your favour. Much will depend on the actual words used, both to you and to your professional body, but unfounded accusations which damage your professional reputation could amount to defamation, for which you could take action. I suggest that you should take a witness with you to the meeting and ask them to take notes on what is said. I'm sure the supplier will have someone he can call on to do the same for him. The discussion should be discontinued if it becomes heated, or if additional accusations are made. However, let's hope that you can sort things out in a reasonable manner without it coming to that.
Should you both be unable to come to a satisfactory settlement, suggest taking the matter to Alternative Dispute Resolution
, ie mediation or arbitration*. You can get details about this from your local County Court or CAB.
So whilst it is a worrying situation for you to be in, it is not a deeply serious one, and so long as you can both remain calm and amicable there is no reason why this cannot be sorted out simply. Make sure that, once you have agreed a settlement, this is confirmed in writing and if the supplier has already contacted your professional body, make sure you provide them with a copy of the settlement document to demonstrate that the matter is at an end.
* If you are not familiar with ADR, mediation means discussions between the parties aimed at finding a solution are mediated by an independent person, but ultimately the parties find the solution theselves, whereas arbitration is done at arms-length, with both parties putting forward their positions to an arbitrator who then negotiates a settlement based on his judgement of the relative positions of the parties. In both systems, parties have to agree to use ADR for the system to work.