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Appeals Court Rules in Favor of Studios in DVD Case

In a major victory for Hollywood movie studios, a federal appeals court on Wednesday barred a Web site from revealing how to make unauthorized copies of digital video discs (DVDs).

The Second Circuit Court of Appeals in New York ruled that the controversial 1998 Digital Millennium Copyright Act (DMCA) does not infringe on the free speech protections of the U.S. Constitution.

There were actions in two other DMCA-related cases on Wednesday. A federal judge in Trenton, New Jersey, dismissed a lawsuit challenging the constitutionality of the DMCA filed by the Electronic Frontier Foundation (EFF).

In that case, a group of scientists claimed they were coerced by the recording music industry not to publish their research on flaws in technology that prevents pirating of digital music.

In California, the San Francisco-based EFF asked a Superior Court judge to dismiss a lawsuit filed against a group of Web publishers who had posted DVD descrambling software online.

In the movie studio case, a three-judge panel of the Second Circuit Court of Appeals issued a 71-page decision affirming an August 2000 ruling by a federal district court judge.

The lower court ruling prohibited Eric Corley from posting DVD descrambling software on the 2600 magazine Web site he publishes, or linking to Web sites that post it.

The software, called DeCSS for Decoding Content Scramble System, can be used to decode the technology safeguards embedded in DVDs to prevent piracy.


The appeals court said online publishing of DeCSS and linking to sites that publish it are not protected by free speech provisions of the First Amendment because the underlying software for those actions is “content-neutral” and serves a function.

DeCSS “is like a skeleton key that can open a locked door, a combination that can open a safe, or a device that can neutralize the security device attached to a store’s products,” the court said.

“Once the DVD is purchased, DeCSS enables the initial user to copy the movie in digital form and transmit it instantly in virtually limitless quantity, thereby depriving the movie produce of sales.”

The case was the first major challenge to the DMCA, which strengthened the protection of copyrighted material in digital format by outlawing the manufacture and distribution of technology or services that circumvent technical protection measures that prevent copying of copyrighted works.

Free speech advocates and scientific researchers have argued the law goes too far in limiting the fair personal use of copyrighted material.

The decision is expected to have sweeping ramifications for copyright law and publishing in a digital age where everything from music to movies can be easily and quickly distributed to an unlimited audience.

The lawsuit was filed by eight major motion picture studios fighting what industry advocates had called the video equivalent of Napster, the popular music swapping technology that was shut down by the music recording industry.


While attorneys for the defense could not be reached for comment, representatives from the other side were jubilant.

“We couldn’t be happier that the court of appeals in a major decision has completely vindicated the DMCA and thereby enabled content companies to enjoy the security for their creative works that Congress meant them to have,” said Charles Sims, lawyer for the movie studios, who works at Proskauer Rose LLP in New York.

Already there are pirated copies of films circulating over the Internet, said Rich Taylor, vice president of public affairs at the Motion Picture Association of America.

“It is a burgeoning problem that will only get bigger as far as movies are concerned,” Taylor said.

Corley’s lawyers can seek a rehearing by the full Second Circuit Court or take the case to the U.S. Supreme Court, Sims said.

A Norwegian teenager, Jon Johansen, and two others developed DeCSS in September 1999 and it subsequently spread to hundreds of Web sites. Johansen said he created it to allow people using the Linux operating system to use DVDs, which work with Windows but not its freely available rival.

New York-based Corley publishes a print and online version of 2600 magazine, which is notorious for giving tips on how to break into telephone and computer networks. He was sued after posting the DeCSS code on his Web site two years ago.

The studios filing the lawsuit were: Universal City Studios Inc., a unit of French media giant Vivendi Universal; Paramount Pictures Corp., a unit of Viacom Inc.; Metro-Goldwyn-Mayer Inc.; Time Warner Entertainment Co., a unit of AOL Time Warner Inc.; Disney Enterprises Inc., a unit of The Walt Disney Co.; Twentieth Century Fox Film Corp., a unit of Fox Entertainment Group Inc.; Tristar Pictures Inc. and Columbia Pictures Industries Inc., both divisions of Sony Corp..

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