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Kaleidescape Prevails in DVD Ripping Case

Manufacturer can continue to make video servers, but Judge did not rule on copyright issues in general.

Manufacturers, dealers, and champions of digital rights everywhere can rejoice: Video server maker Kaleidescape has beaten the DVD Copy Control Association (DVD CCA).

The DVD CCA, which licenses the Content Scramble System (CSS) for protecting DVDs, had claimed that Kaleidescape breached a contract when it created products that enable (indeed encourage) individuals to copy protected DVDs onto hard-drive servers.

Kaleidescape argued, first and foremost, that nothing in the DVD CCA licensing agreement prohibits the development of products that allow users to copy their DVDs.

Indeed, that's exactly what Judge Leslie C. Nichols ruled today in the non-jury trial at the Downtown Superior Court of Santa Clara in San Jose, Calif.: There was no breach of contract.

As Kaleidescape CEO Michael Malcolm explains, "The DVD CCA went on a fishing expedition for three years, trying to find a breach." In the end, he says, Judge Nichols agreed that "nothing in the agreement prevents you from making copies of DVDs. Nothing requires that a DVD be present during playback."

Because of this ruling, the Judge did not have to get into copyright issues, so the Kaleidescape ruling has no copyright implications. It is not a statement on the legality of ripping DVDs.

There was the possibility that copyright issues ~could~ have come into play. The DVD CCA submitted to the Court a particular document, the "CSS General Specifications," that it asserted was part of the licensing agreement.

Malcolm argued that the particular document, which is "available only after you sign the license and pay the fee," is not part of the contract.

The paper describes the CSS spec, he says, but it does not prescribe any type of action.

The CSS General Specifications document includes wording about thwarting the "unauthorized copying" of DVDs. The issue of what constitutes an unauthorized copy could have come up, but Judge Nichols ruled that the document in fact is not part of the DVD CCA licensing agreement.

Specifically, the document indicates that CSS is meant to keep "casual users from making unauthorized copies of DVDs," Malcolm explains. "We would have argued that users ~are~ authorized under U.S. law," specifically the doctrine of fair use.

Other Implications of the Case

Might the DVD CCA appeal? There is always that chance, of course, but Malcolm says the Judge was extremely thorough in his ruling, which might make it tough for the DVD group to win on appeal.

Will the DVD CCA change its licensing agreement to prohibit licensees from making DVD servers? "They could do that," Malcolm says, but it could take a very long time to get all of the appropriate board approvals.

Malcolm suggests, "What we may see instead is that more of their [DVD CCA's] members may want to compete in this market rather than ignore it."

Malcolm has argued in the past, and I've agreed, that the reason the DVD CCA sued Kaleidescape in the first place is that the organization's influential board members didn't have products to compete with the Kaleidescape server.

So how will case affect other video server vendors in the same boat? It won't affect many of them because most of the video server vendors in our industry do not have licenses from the DVD CCA. (Malcolm's take on that: "I never wanted to take the approach, like other video server manufacturers, that makes outlaws out of customers.")

It could be that the evil ways of the DVD CCA have kept server manufacturers from going legit. In fact, by suing Kaleidescape, the DVD CCA was essentially telling manufacturers that they are better off making DVD ripping products without the CSS licenses.

Not all DVD server vendors, however, would be in compliance with the DVD CCA's regulations, which prohibit the exposure of DVD decryption keys on a publicly available bus. In other words, protected content cannot leave a closed ecosystem, as in a PC network. "We have gone to a lot of trouble to comply with that," Malcolm says.

AMX is one company that does have a DVD CCA license, and it came out in court that the consortium is pursuing or would pursue the vendor, according to EE Times, which followed the case.

AMX probably doesn't need to worry now.

Although this particular decision does not have far-reaching implications for the fair-use movement, it certainly doesn't hurt.

"This is one small victory," Malcolm says.

Small, indeed. Even the newly introduced Fair Use Act of 2007, which is meant to tone down the Digital Millennium Copyright Act (DMCA) of 1998, would not allow consumers to rip DVDs.

DVD Ripping: The Whole Picture
Kaleidescape vs. DVD CCA: Judge Rules Against Movie Servers
Tentative ruling in landmark DVD-copying case says Kaleidescape knew its movie servers might be in violation of DVD CCA licensing agreement that prohibits copying of DVDs.
DVD Ripping: The Latest on the Legal Front
This compilation of articles on the legality of DVD ripping, and related fair-use cases, will be updated continuously.
Understanding the Kaleidescape, RealDVD Cases
What have the courts really decided on DVD copying, and what are the implications for the future? We debunk the myths about the the two lawsuits and clarify the current legal state of DVD ripping.
Is DVD 'Ripping' the Same as 'Archiving?'
Is the term "ripping" generally understood as the "illegal" form of copying a disk? Likewise, is "archiving" known as the bit-for-bit "legal" way of doing it?
Can You Be Sued for Helping Clients Rip DVDs?
EFF attorney Fred von Lohmann explains some of the legal issues involved in selling and installing products that enable users to copy DVDs.
Is Your DVD Server Legal? Manufacturers Say Yes!
Developers of movie-ripping products insist their products are legal. Here's how the manufacturers justify their solutions.
Copy Protection Group Sues Kaleidescape (2005)
Kaleidescape has a license from the DVD CCA to employ CSS decoding in its media servers, which it does. Now, DVD CCA is suing Kaleidescape for breach of contract.
Would Studios Rather We Buy DVD Ripping Products Offshore?
As studios work to quash legitimate products like RealDVD, offshore providers of DVD ripping software -- like AnyDVD developer SlySoft -- are reaping the rewards.
Industry Insider: DVD CCA Is an Innovation-Stifling Cartel (2005)
The DVD Copyright Control Association (DVD CCA) is a bunch of bullies. The organization manages to coerce all manufacturers of DVD players to sign away their rights to innovation.

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Article Topics

News · Product News · Video · Media Servers · Digital Rights · Legal · Legal · Media Server · Digital Rights · All topics

About the Author

Julie Jacobson, Co-Founder, EH Publishing / Editor-at-large, CE Pro
Julie Jacobson, recipient of the 2014 CEA TechHome Leadership Award, is co-founder of EH Publishing, producer of CE Pro, Electronic House, Commercial Integrator, Security Sales and other leading technology publications. She currently spends most of her time writing for CE Pro in the areas of home automation, security, networked A/V and the business of home systems integration. Julie majored in Economics at the University of Michigan, spent a year abroad at Cambridge University, earned an MBA from the University of Texas at Austin, and has never taken a journalism class in her life. She's a washed-up Ultimate Frisbee player currently residing in Carlsbad, Calif. Follow her on Twitter @juliejacobson. [More by Julie Jacobson]

5 Comments (displayed in order by date/time)

Posted by corina  on  02/02  at  04:39 AM

Philips and Sony decided it was in their best interest to avoid another format war over their MultiMedia Compact Disc,ccdp and agreed to unify with companies backing the Super Density Disc to release a single format with technologies from both. The specification was mostly similar to Toshiba and Matsushita’s Super Density Disc,ccie written exam preparation except for the dual-layer option (MMCD was single-sided and optionally dual-layer, whereas SD was single-layer but optionally double-sided) and EFMPlus modulation.

Posted by alita  on  02/02  at  04:40 AM

A dual-layer disc differs from its usual DVD counterpart by employing a second physical layer within the disc itself.ccsp certification The drive with dual-layer capability accesses the second layer by shining the laser through the first semitransparent layer. In some DVD players, the layer change can exhibit a noticeable pause, up to several seconds. dual-layer disc packaging.

Posted by Colleen  on  03/10  at  10:56 AM

This really has become a major issue now a days. and they should be very strict in implementing this law
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Posted by Gibes  on  03/11  at  10:08 AM

If this law will be implemented, I think they should really make it a point that this should be strictly followed.
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Posted by djody  on  04/03  at  04:48 PM

by suing Kaleidescape, the dvd cca was essentially telling manufacturers that they are better off making dvd ripping products without the css licenses, yes sure its evil.

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