California Court Rules for DVD Industry

By | August 26, 2003 at 12:00 AM

The California Supreme Court ruled Monday that courts may block Internet users from posting codes that could be used to illegally copy DVD movies, in a case that pitted trade secret rights against free speech.

The justices did not resolve whether the code was in fact a trade secret, leaving that for a lower court to determine. They did rule, however, that they would not tolerate the posting of legitimate trade secrets online and reversed a lower court that said disseminating trade secrets was protected free speech.

The case centered on San Francisco computer programmer Andrew Bunner, who in 1999 posted the code to crack the encryption technology and, according to the movie industry, helped users replicate thousands of copyright movies per day.

The DVD Copy Control Association, an arm of Hollywood studios, said it controls the encryption system, which scrambles data to prevent unauthorized copying of a movie sold in the DVD format. The association sued Bunner and others under California’s Uniform Trade Secrets Act.

A San Jose judge ordered Bunner to remove the encryption-cracking code from the Internet. But the 6th District Court of Appeal in San Jose lifted that injunction, a move the DVD Copy Control Association said was akin to giving crooks the technology to reproduce protected material such as movies on a large scale.

The court of appeal ruled that protecting trade secrets is not as important as “the First Amendment right to freedom of speech.”

A unanimous Supreme Court, however, ruled otherwise Monday.

Justice Janice Rogers Brown, in reversing the appeals court on a 7-0 vote, said an order to remove the code “does not violate the free speech clauses of the United States and California constitutions.”

The case is not fully resolved, however, because the Supreme Court also ordered the San Jose appeals court to analyze whether the code is still a protected trade secret given its widespread exposure.

The DVD association hailed Monday’s decision.

“This opinion has wide applications to trade secret law,” said association attorney Robert G. Sugerman. “Owners of trade secrets can now protect those trade secrets through injunctive relief, which is clearly now available.”

During oral arguments three months ago, California Attorney General Bill Lockyer joined the group in arguing that industry secrets would be plundered if computer users could post them without court intervention. Companies including Boeing Co., Ford Motor Co. and AOL Time Warner Inc. urged the justices to side with the DVD association, arguing that trade secret protections trump First Amendment speech protections.

Bunner did not devise the decryption code, but instead posted it on one of his Web sites. The Norwegian teen who cracked the code, Jon Johansen, was acquitted in Norway in January of charges he stole trade secrets.

Bunner, 26, said he has removed any reference to it from the Internet and is fighting the case to stand up for free speech rights. He is one of dozens of people throughout the United States that the association is suing for posting the code.

He said Monday he believed his actions were lawful, and said he posted the code to let others play DVDs on their computers.

“The idea was to get it out there for an open-source DVD player,” Bunner said.

His attorney, David A. Greene, said the appeals court could still ultimately support Bunner’s actions because the code’s global dissemination may not grant it status as a trade secret anymore.

Related Content