Alternate Realities

'Somebody who still has the right to distribute'... however, they only have the right to
distribute the work under the GPL - which explicitly says that you must distribute the work
giving the recipient all the rights that you have.  In your scenario, where person A 'still'
has the right to distribute the software to person B but B does not have the right to
distribute it further, the consequence is that A cannot distribute the software at all, since
he cannot do so in compliance with the GPL.