The judge ruled that format shifting was fair use. The fair use argument was enhanced because the original was destroyed. Hypothetically, one could do only the format shifting and keep the original - but the original could not be sold or donated or otherwise given away because then the format shifted copy would not be fair use.

I can burn DVD copies of my old VHS tapes. I cannot then give away the old VHS tapes or sell them at a garage sale. If I keep them, they're cluttering the shelf... so the VHS tape gets thrown away afterwards.