VidAngel Case: Studios Win Injunction Against Streaming Service That Filters Content

Legal Gavel

2nd UPDATE, 6:25 AM: The studios released a new joint statement today saying VidAngel continues to infringe on their IP despite last week’s injunction blocking streaming of movies on the site. “Defying last week’s injunction,” they said, “VidAngel continues to illegally stream our content without a license and is expanding its infringement by adding new titles. We have brought VidAngel’s indefensible violation of the injunction to the court’s attention. As the court made clear in its order, VidAngel’s unauthorized acts of ripping, copying and streaming our movies and TV shows infringe copyright and violate the Digital Millennium Copyright Act. VidAngel’s filtering of content has nothing to do with the claims against it and does not excuse its illegal activities.”

UPDATED with studios’ statement: It took a month, but a judge today granted a request by several film studios for an injunction blocking VidAngel from continuing to stream films with objectionable content filtered out by consumer request.

“We are extremely gratified the court enjoined VidAngel’s unauthorized streaming service from infringing our copyrights and violating the Digital Millennium Copyright Act,” Warner Bros, Disney and Fox said in a joint statement Tuesday. “This case was never about filtering. The court recognized that the Family Movie Act does not provide a defense to VidAngel’s infringing acts of ripping, copying and streaming copyrighted movies and TV shows. We look forward to defending the court’s decision against any appeal by VidAngel.”

Filed in June, the studios’ complaint against start-up VidAngel appears to be shaping up as a showdown between the federal Family Movies Act, which permits individuals to filter what they consider to be unacceptably violent, profane or other content from home entertainment versions of films, and protection afforded copyright owners under the Digital Millennium Copyright Act.

“Plaintiffs bring this motion on the grounds that they are likely to succeed on the merits of their claims and that they will suffer irreparable harm,” U.S. District Judge Andre Birotte Jr. wrote in today’s order (read it here). “Upon consideration of the parties’ arguments, papers and the case file, the court hereby grants the motion for preliminary injunction.”

VidAngel, which recently raised a little over $10 million in a public offering, says it sells a copy of a film to customers for $20, allows the purchaser to select which snippets will be eliminated, then offers to buy the copy back for as much as $19, a price that diminishes by a dollar for each day the buyer keeps it. The studios say that amounts to little more than a low-price rental, as some buyers choose minimal filtering of hits like the most recent Star Wars film.

In arguing against the motion last month, VidAngel attorney David Quinto said 96% of the company’s customers filter at least two elements from films, and on average, he said, they request filtering of 17 elements. The most frequently chosen filters, he said, eliminate female nudity and two common obscenities.

Kelly Klaus, arguing for the studios, countered by citing user endorsements in which VidAngel customers raved about the service’s ability to provide cheap, timely streams of popular films with minimal cleanup.

In an intricate discussion of the actual mechanics behind VidAngel, both Klaus and Quinto described a process under which the company actually purchases a DVD for each film streamed — whether directly from the studio, or by re-purchase from an earlier consumer. But it actually makes only one master copy of each film, which is broken into bits, tagged by those who watch and assess its content, then scattered into a cloud storage mechanism. Thus, consumers who briefly “own” a DVD, actually watch an assemblage gathered from a single master. Klaus argued that those are being illegally “ripped” from a DVD in what amounts to little more than piracy.

At last month’s hearing, Quinto repeatedly insisted that both the Family Movies Act and the Digital Millennium Copyright Act authorize the master, without which there would be little or no way to deliver the family-friendly movies envisioned by Congress when it created the family film legislation.

Michael Cieply and Dominic Patten contributed to this report.

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