The case will be heard in a New York court after EMI sued ReDigi for copyright infringement earlier in the year.
ReDigi, which markets itself as the first legal site where users can purchase second-hand music files, argues its software complies with existing US copyright laws.
But EMI says a legal principle, called the first sale doctrine, which allows purchased goods to be resold, does not apply to digital music. The music giant argues that, unlike CDs and books, it is impossible to guarantee all the original copies of the MP3 have been deleted and therefore people could re-sell the file while retaining a copy for themselves.
Thousands of people downloaded ReDigi's software in the first weeks after its launch, says EMI. The company is demanding that the one-year-old start-up pay a $150,000 penalty charge for each song it has sold on.
It is expected that the case , which begins in New York today, will be followed closely by the media and music industries as it could set a precedent as to whether digital music files can be resold.
Google has sent a letter to the judge outlining the company's "specific and vital interest" in the outcome.
Digital music is enjoying a boom in sales and is set to overtake CD and vinyl sales for the first time in 2012, according to research from Strategy Analytics.
ReDigi's chief executive John Ossenmacher said the company was "surprised by the lawsuit".
He added: "Most lawful users of music and books have hundreds of dollars of lawfully obtained things on their computers and right now the value of that is zero dollars," said
"ReDigi takes zero dollars and we create billions of dollars in wealth overnight."
The start-up's model involves asking users to download a software package which checks if a music file was originally bought legally. If it was, the file is deleted from the hard drive of the person selling and uploaded to ReDigi.
EMI lawyer Richard Mandel declined to comment on the lawsuit but in court documents, EMI notes that it had discussions with ReDigi. However, it is stated that it "certainly did not provide any approval of [its] concept".
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