RealDVD: A walk through the complaint

Here's my read of the MPAA complaint in Universal v Real (PDF).

The MPAA's complaint against Real over its RealDVD rip-and-view product has only two causes of action. One is a Digital Millenium Copyright Act claim; the other is a state law breach of contract claim.

In the DMCA claim, the studios simply make the assertion that Real's product violates the terms of the law. The complaint sites the law and then asserts that RealDVD violates the law:

The juice of the complaint is the breach of contract claim. One might be forgiven for suspecting the DMCA claim is just stuck in there to give the federal court jurisdiction. (They can both be heard in federal court due to supplemental jurisdiction.)

MPAA's real claim is that Real was given a CSS (Content Scramble System) license in August 2007 "to build a product to play DVDs" but the company turned around and built a product that copies DVDs. And it's this license that Real wants the court to find does cover RealDVD.

RealDVD bypasses the CSS protection measures by making a complete, bit-for-bit copy of the entire contents of a CSS-protected DVD onto either a local computer hard drive or a connected external USB hard drive.

Real, on the other hand, says that not only does it not violate CSS, it actually adds superior encryption for the studios. No charge!

RealDVD not only maintains the DVD's native CSS encryption intact, it also adds another layer of digital rights management encryption that effectively locks the DVD copy to the owner's computer to ensure that the content can not be improperly copied or shared. RealDVD provides consumers with a great solution for the playback and management of their DVD collections while adding security that is more robust than CSS.

Specifically, MPAA says that Real agreed to abide by the CSS Specifications, which require licensed products to ensure that a user can't watch a DVD on computer without a physical DVD being in the drive. Such violations, MPAA says, cause irreparable damages justifying a permanent injunction not only because it interferes with DVD sales but also because it undercuts the studios' ability to sell content through iTunes, Amazon and DigitalDownload DVDs. Plus, the studios say, Real's status as lawful software vendor matters. "Real conveys the false impression that conduct that consumers have long understood to be wrong is now legal." There is money, too: Up to $2 million in attorneys fees and costs, and $100,000 in mitigation measures.