RealDVD Suit Could Spur Flood of Legal DVD Copies

Hollywood reluctantly tackling question of whether there is a consumer right to copy DVDs.


Another effort to help consumers copy their DVDs has hit a legal snag. A federal judge has indefinitely barred sales of RealDVD at the request of Hollywood executives who say they're just trying to prevent a flood of illegally pirated disks.

But in suing Real, the studios could unintentionally blow the dam wide open to what would be legal copies. If Real has the stomach and dollars to fight the movie industry, the resulting decision could help clarify whether consumers have the right to make copies of DVDs for private use.

The software from Real Networks enabled duplicating to a PC hard drive for convenience and safekeeping. The judge temporarily banned sales after leading studios sued Real. The studios argue that the software violates a federal law that they say prohibits any unauthorized DVD ripping.

But their case amounts to a risky legal strategy, reports Paul Sweeting at his MediaWonk blog. Among other issues, the suit could force the federal judge to decide whether the 1998 federal law prohibits any copying, or if it allows duplicates for private use.

The question stems from a 1984 decision by the U.S. Supreme Court that consumers had the right to copy content for private use. That "Betamax" case made it legal to use VCRs to record television shows.

Courts have yet to resolve the apparent conflict between the federal law and the Supreme Court decision. Some have ruled, as in a case involving 321 Studios, that the 1998 law, called the Digital Millennium Copyright Act, trumps fair use. That is, any technology that gets around copy protection breaks the law.

But, Sweeting writes, "others have ruled that the purpose of the circumvention matters."

The studios have avoided tackling that central question, says Hugo Feugen, founder of CodexNovus, a company that makes home media servers. The studios cite fears of Internet piracy in their blanket ban on copying. "But ultimately, what goes on in consumers' homes is the real issue," he says.

At least for Feugen's servers, which are among a new class of products that enable consumers to digitally store music and videos in a central place. Those from CodexNovus don't help consumers rip commercial DVDs because of potential lawsuits from Hollywood.

He and others in the industry would like to see the issue decided. "We're certainly suffering from all these legal threats," Feugen says.

Despite the risks, Hollywood had little choice but to invoke the DMCA. That's because another company that makes media servers had backed the studios into a corner in a case decided last year. Called Kaleidescape, that company directly challenged the studios with software that can rip DVDs to the server, where they are protected from further copying.

The company was unsuccessfully sued by the group that governs DVD contracts, a group that includes the Hollywood studios. But that suit avoided the question of the DMCA ban on copying. It instead claimed that Kaleidescape had violated a contract with the DVD group.

The suit said that contracts governing DVD players require that the disk be physically present in a player. The judge, however, said that requirement was in a secondary document that is not part of the contract itself. That ruling is under appeal.

With the contractual argument in doubt, the studios apparently felt compelled to sue Real over the bigger issue of the DMCA.

Even so, the studios could lose on another, more esoteric question. Real argues that its software doesn't in fact break the copy protections in DVDs.

Real jumped through hoops to satisfy that point. The Seattle company says it preserves the encryption that prevents the copying of a DVD, and then layers on its own scheme for protecting the content. Digital copies can't be made outside RealDVD. The copy made by the software could not be distributed.

Still, the studios also claim that RealDVD is "using authorized technology for an unauthorized purpose." The trouble is that two courts have ruled that does not violate the DMCA, argues Fred von Lohmann of the Electronic Frontier Foundation, a group critical of today's copy regimes.