Kaleidescape Settles with DVD CCA

10-year legal battle ends between Kaleidescape, maker of DVD servers, and the DVD CCA, which governs copyright protection of DVDs. A statement on DRM? Not really.

Julie Jacobson · May 20, 2014

Kaleidescape, the high-profile maker of DVD servers, apparently has ended its legal battle with the DVD CCA, which sued the manufacturer in 2004 for making DVD servers that allegedly encourage customers to rip copyrighted movies illegally.

Yesterday, the Superior Court of California, Santa Clara, noted a “voluntary dismissal” of the case. Kaleidescape CEO Cheena Srinivasan tells CE Pro that both parties have agreed not to comment at this time.

Court notices indicate that Kaleidescape requested a dismissal of the case on May 12 and that the next day a joint notice of settlement was filed. The court took three days to review the parties’ stipulations and determined on May 19th, “Case complete.”

The case ends a long and complicated test of the rights of both content creators and the studios who market that content … as well as the consumers who “own” copies of the content and the manufacturers who unlock it.

The studios are represented by the DVD CCA (Copy Control Association), which creates and governs the Content Scramble System (CSS) that protects DVDs. That group argues that the license that governs CSS – required of all manufacturers who make DVD players – expressly prohibits the manufacturers from allowing users to copy DVDs, even if they own those DVDs.


Kaleidescape has always maintained that the DVD CCA contracts express no such prohibitions. In any case, Kaleidescape servers make bit-for-bit copies so that the digital rights management (DRM) provisions of CSS are preserved.

Many analysts erroneously attribute Kaleidescape’s legal woes to the Digital Millennium Copyright Act (DMCA), which prohibits the manufacture and distribution of products that encourage copyright infringement.

But no lawsuit under the DMCA has been brought against Kaleidescape, which has a relatively small customer base of wealthy clients including the Hollywood elite.

Also erroneously, many assume that Kaleidescape and similar DVD-copying systems are legal under the “Fair Use” doctrine, but that is not the case in the U.S.

Even so, the UK famously made it legal in March to rip protected DVDs there for personal back-up.

The legal imbroglio with the DVD CCA has forced Kaleidescape to impose burdens on its customers and its engineers … while offshore companies like AnyDVD and the U.S. manufacturers that employ their legally untouchable software proceed with impunity.

We cannot say for sure if the Kaleidescape settlement with the DVD CCA has broader implications for DRM but we assume (hopefully) that the closure allows Kaleidescape to go forward with its business.
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  About the Author

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. Email Julie at [email protected]

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