Six major Hollywood movie studios took on RealNetwork, suing the software maker of RealDVD for making products that can potentially be used to pirate movies. With RealDVD, a user could copy a DVD onto his hard drive. While RealNetwork argued that this allowed users to backup copies of legally purchased DVDs, a US District Court disagreed and sided with Disney Studio, Sony Pictures, and four other studios and ordered the Seattle-based company to pay court fees and issue refunds to 2700 customers who bought the software.
RealNetwork’s troubles began just days after it released RealDVD in October of 2008. US District Court Judge Marilyn Hall Patel blocked the software from being sold temporarily so she could determine if it violated federal digital piracy laws. Another ruling in August placed an injunction on RealNetwork, barring sales pending a trial. Another trip to court in January had Judge Patel dismissing RealNetwork’s claim that the actions of the studios violated antitrust laws.
On Thursday, RealNetworks agreed to withdraw their appeal and pay $4.5 million in court fees and restitution to about 2700 people who had purchased RealDVD. Motion Picture Association of America (MPAA) general counsel and chief content protection officer Daniel Mandil said, “Judge Patel’s rulings and this settlement affirm what we have said from the very start of this litigation: it is illegal to bypass the copyright protections built into DVDs designed to protect movies against theft.”
RealNetwork spokesperson Bill Hanks said, “We tried to deliver a solution that would give consumers the right to exercise their fair use rights to the content they had purchased or rented while protecting the rights of the content creators, but the court ruled against us.” Indeed, RealDVD had restrictions built in to protect the copyrights of the various studios. It didn’t allow, for instance, a user to rip a movie and then share it on a P2P site where anyone could upload it. This is really MPAA’s worst nightmare. Hanks also says that people will lose all respect for copyrights because it is so easy to rip movies illegally.
This leads some to believe that there will be a proliferation in illegal ripping services – ironic since RealNetwork sought to allow legal copying. And this may not be quite the victory the MPAA imagined. Alliance Consulting Group president Sally A. Wright compared the MPAA to the RIAA (the music industry’s copyrights watchdog) saying, “The whole world of digital entertainment is a cutting edge medium, and the entertainment industry just isn’t getting it. They may win today, but their linear thinking will cost them billions down the road.” They’ve effectively made illegal copying the only alternative for DVD owners, helping make their own worst copyright nightmare one step closer to being realized.
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