When the DVD Copy Control Association (DVD-CCA) issued RealNetworks Inc. a license agreement authorizing it to create DVD player software, it never imagined RealNetworks would one day create a product that also copies DVDs. According to the seven major movie studios now suing RealNetworks over its RealDVD software, the license agreement does not allow the company to make a tool that allows consumers to copy a DVD onto a computer's hard drive.
The studios filed a lawsuit Sept. 30 in Federal District Court for the Central District of California, alleging RealDVD violates the Digital Millennium Copyright Act (DMCA) because it illegally bypasses the copyright protection built into DVDs that protects movies against theft. They also allege that creating a tool that makes copies of DVDs is an unauthorized function of the Content Scramble System (CSS), which is the DVD encryption technology the DVD-CCA License Agreement provides to licensees.
The studios argue that in manufacturing and selling RealDVD, RealNetworks has circumvented the CSS protections built into DVDs that prevent unauthorized reproduction and distribution of copyrighted material, and the CSS license was never intended to authorize such a product. RealNetworks argues the license gives it the right to use and implement the intellectual property of the CSS; therefore it is not circumventing any technological measures and is not violating the DMCA.
RealNetworks' defense is relying on a similar case. Kaleidescape Inc. also obtained a CSS license from the DVD-CCA and used it to create a product that copies DVDs. In the 2007 decision in DVD Copy Control Association Inc. v. Kaleidescape Inc. the Superior Court in Santa Clara County, Calif., found that Kaleidescape did not violate the license agreement. The Kaleidescape case turned on the licensing process.