Judge: DVD-copying software is illegal

update After eight months of deliberation, a San Francisco federal judge has ruled that software company 321 Studios' popular DVD-copying products are illegal.

In a ruling released Friday, Judge Susan Illston granted Hollywood studios' request for an injunction against 321 Studios, saying the small software company has seven days to stop distributing its DVD-copying products.

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What's new:
A federal judge in San Francisco rules that software company 321 Studios' popular DVD-copying products are illegal.

Bottom line:
321 has seven days to pull its products, but the impact goes beyond that company. The judge wrote that federal law made it illegal to sell products that break through DVDs' antipiracy technology, even if consumers have a legal right to make personal copies of their movies.

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The case was widely viewed as a test of how far commercial software could go in helping consumers make backup copies of their own legally purchased digital entertainment products, such as DVDs or video games. Illston wrote that federal law made it illegal to sell products that--like 321 Studios' software--break through DVDs' antipiracy technology, even if consumers do have a legal right to make personal copies of their movies.

"It is the technology itself at issue, not the uses to which the copyrighted material may be put," Illston wrote. "Legal downstream use of the copyrighted material by customers is not a defense to the software manufacturer's violation of the provisions (of copyright law)."

The ruling, which had been pending since arguments last May in Illston's court, goes a long way toward shoring up Hollywood's weakening digital copy protections for its profitable DVD business--even while potentially eliminating one key driver of sales in the DVD burner market.

In previous interviews, 321 Studios has said it has sold about 1 million copies of its DVD-copying software, many of them through mainstream computer stores such as CompUSA. Under the ruling's terms, the company will have to remove from its software the ability to "rip" copies of copy-protected DVDs or take the products off the market altogether.

The company said it would immediately ask for an emergency stay that would let it keep the software on the shelves but would appeal Illston's ruling, regardless of what happened.

"We can't just lay down for this," 321 Studios President Robert Moore said. "It is too important for the consumer; it is far too important to the evolution of our culture...We think the final battle will be fought at the Supreme Court or at the congressional level."

Hollywood executives praised the ruling.

"Companies have a responsibility to develop products that operate within the letter of the law and that do not expose their customers to illegal activities," MPAA Chief Executive Officer Jack Valenti said in a statement. "Today's ruling sends a clear message that it is essential for corporations to protect copyrighted works while facilitating the enjoyment of entertainment offerings through new digital technologies."

Long battle over DVDs
Illston's ruling is the latest in a long string of rulings that have largely gone against critics of Hollywood's protection efforts, even as the technology to copy DVDs has spread more widely online and off.

Most Hollywood DVDs are protected with a technology called Content Scrambling System, or CSS, which encrypts the content on the discs so that they can only be read by devices with authorized "keys" to unlock the data. A studio-affiliated trade group licenses those keys to DVD player manufacturers.

However, in 1999, a Norwegian teenager named Jon Johansen released a software program called DeCSS, which allowed computers to decrypt DVDs, even without a licensed "key." Once the video was decrypted, it could easily be copied, and so DeCSS quickly found its way into DVD-copying tools.

Hollywood studios sued to keep DeCSS offline, and a New York federal judge ultimately agreed that posting the software online violated parts of the U.S. Digital Millennium Copyright Act, which bars distribution of tools that break through digital copy protection mechanisms.

Not long afterward, 321 Studios began selling its own software, however. Despite the New York ruling, the company argued that its software was legal and necessary in helping consumers make the personal copies federal law allows.

The company actually initiated the legal battle in early 2002, suing studios in hopes of winning a ruling that'd say its software was legal. The studios later countersued.

In her ruling Friday, Illston was unconvinced by any of 321's arguments.

Hollywood critics have long said CSS simply controls access to DVDs and that it's not a direct copy protection mechanism. And 321 has argued that since consumers who buy a DVD have the right to access their own movie, it would not be illegal to help them access it by using 321's software.

Illston disagreed, saying CSS was plainly a way to protect copyright holders' rights, as envisioned in copyright law.

She said blocking people from making perfect digital copies of their DVDs did not unconstitutionally hamper free speech or fair-use rights. People were free to make copies of movies in other, nondigital ways that would give them access to the same content, even if not in the same, pristine form, she said.

And, she said, the fact that DVD decryption keys were widely available online in programs like DeCSS did not make Hollywood's attempts to block copying useless.

"This is equivalent to a claim that, since it is easy to find skeleton keys on the black market, a dead bolt is not an effective lock to a door," she wrote.

Earlier this month, 321 Studios released new software that makes backup copies of computer games. That product will not be affected by this ruling, the company said.

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