Kaleidescape Defends Its DVD Ripping System as CSS-Compliant

Judge William Monahan’s denial of a stay of the injunction against Kaleidescape in the DVD CCA breach-of-contract lawsuit was “expected” and clears the way for Kaleidescape to take the case in the Superior Court of California to the appeals court, a Kaleidescape spokesman told Consumer Electronics Daily. “It’s good that he acted quickly because it allows us to go to the court of appeal immediately,” the spokesman said, adding “there are a lot of moving pieces” before the injunction against sales of Kaleidescape’s DVD ripping software goes into effect April 8.

Kaleidescape will comply with the court order, the spokesman said, and Kaleidescape systems that ship on Monday April 9 “will not import DVD copies to hard disk, but there’s no impact to the way the system handles Blu-ray Discs or CDs,” which are not part of the suit regarding the Content Scrambling System used for DVDs. Regarding existing products in the market that are capable of copying DVDs to hard disk, the spokesman said, “the behavior of systems will not change” based on the most recent ruling. “People have to remember that we won the trial in 2007 so we've been selling in good faith and customers have been purchasing in good faith with a court decision saying we were fully compliant with the [CSS] license,” he said. “Everything has been above board and to the letter of the law. It would be hard to imagine a judge coming back and saying those 10,000 customers who purchased over the years have to break those systems” to bring them into compliance, he said.

Kaleidescape will continue to provide support and service for products in the field, including software updates via the Internet, the spokesman said. “The actual DVD encryption module may not be able to be updated,” the spokesman said, “but we will be able to provide new features that don’t affect that module.” Upgrades to hardware, capacity expansion, power supplies and user experience features won’t be affected by the injunction, he said. A feature upgrade that won’t be affected, for example, is one that enables customers to go directly to the most memorable scenes in their movie collection, bypassing previews and the FBI copyright warning, he said. Kaleidescape won’t be able to update the descrambler of the DVD system, the spokesman said, “but there’s no reason to update it. It’s been stable for quite some time."

Steven Zager of Akin Gump, counsel to DVD CCA, said in a statement, “After a lengthy trial, the Court determined Kaleidescape had agreed to a contract with clear requirements for using the Content Scramble System (CSS) and knowingly violated these terms when it created and sold its DVD movie server system. For nearly 8 years since litigation began, the company has continued to sell and profit from this product,” Zager said. “It is time for the decision of the Court and the terms of the contract to be enforced.”