The major movie studios jointly sued RealNetworks Inc. for releasing a new program that lets consumers copy DVDs onto computers, in the latest legal tussle between the entertainment and technology industries over the boundaries between consumer rights and copyright laws.In the suit, filed Tuesday in federal court in Los Angeles, the Hollywood studios alleged that RealNetworks' RealDVD program, which went on sale Tuesday, illegally bypasses copy-protection measures intended to prevent duplication of DVDs. The plaintiffs -- including Walt Disney Co., Time Warner Inc.'s Warner Bros., News Corp.'s Fox, NBC Universal Inc.'s Universal City Studios, Viacom Inc.'s Paramount and Sony Corp. -- asked the court for a temporary restraining order preventing RealNetworks from selling the software, along with financial damages.
"RealNetworks RealDVD should be called StealDVD," Greg Goeckner, executive vice president and general counsel of the Motion Picture Association of America, the main lobbying arm of the movie studios, said in a statement. "RealNetworks knows its product violates the law and undermines the hard-won trust that has been growing between America's movie makers and the technology community."
Representatives of the individual movie studios declined to comment or couldn't be reached. News Corp. owns Dow Jones, publisher of the Wall Street Journal.
RealNetworks, which filed its own suit against the studios in federal court in San Francisco just before their action, accused them of continuing an entertainment-industry pattern of trying to crush technologies that give consumers flexibility in how they enjoy music, video and other media. The Seattle company said it wanted to protect consumers' "fair-use rights" to make copies of their own purchased DVDs.
The RealDVD program lets consumers copy DVDs onto computers.
"Our argument for the studios has been embrace technology -- it can help you create new business opportunities," said Rob Glaser, CEO of RealNetworks.
The company says the software, which costs about $30, doesn't violate laws because it doesn't break the copy-protection system designed to prevent rampant copying of DVDs. Instead, RealDVD makes a copy of everything on a DVD, including the copy-protection system, and puts it on a PC, layering on additional software protections to keep users from trading movies online. RealNetworks has licensed the DVD antipiracy technology software from the DVD Copy Control Association, a nonprofit that licenses DVD copy-protection technology.
The lawsuit is likely to hinge on whether RealNetworks "circumvents" the copy-protection software in DVDs, a violation of a federal law called the Digital Millennium Copyright Act.
"If Real succeeds, you'll see a lot of similar products come out," said David Anderson, an intellectual property attorney at Nixon Peabody LLP in Los Angeles. "The impact that's going to have in terms of DVD sales is something I don't think anybody has a handle on."
By: Nick Wingrfield
Wall Street Journal; October 1, 2008
