United States District Court, S.D. New York
March 3, 2004.
PARAMOUNT PICTURES CORPORATION and TWENTIETH CENTURY FOX FILM CORPORATION, Plaintiffs -against- 321 STUDIOS, A/K/A 321 STUDIOS LLC, A/K/A TERR LCC, Defendant
The opinion of the court was delivered by: RICHARD OWEN, Senior District Judge
OPINION AND ORDER
Before me is plaintiffs' motion for a preliminary injunction and
defendant's motion to transfer the case to the Northern District of
Paramount alleges that 321 Studios violated the Digital Millenium
Copyright Act, 17 U.S.C. § 1201("DMCA"), 17 U.S.C. § 1201(a)(2)
and § 1201(b)(1) (the so-called "anti-trafficking provisions") by
manufacturing and selling trafficking in a computer
software product that permits the possessor of a digital versatile disk
("DVD") encoded by a protective technological measure known as the
Content Scramble System ("CSS") to decode the CSS, and thereby make
identical copies of such DVDs.
321 Studios' conduct at issue in this case is essentially identical to
what this Court and the Second Circuit have heretofor held violates the
anti-trafficking provisions of the DMCA. See Universal
City Studios, Inc. v. Reimerdes, 82 F. Supp.2d 211 (ordering
preliminary injunction); Universal City Studios, Inc. v.
Reimerdes, 111 F. Supp.2d 294 (ordering permanent injunction);
Universal City Studios, Inc. v. Corley,
273 F.3d 429 (affirming permanent injunction). In those cases the
Courts found that the defendants' DeCCS software violated the DMCA.
Corley, 273 F.3d at 435-444: Reimerdes, 82 F. Supp.2d
at 216-17; Reimerdes, 111 F. Supp.2d at 318-19.
In Reimerdes and Corley the defendants offered
their DeCSS software for free over the Internet whereas here, 321 Studios
is offering such software for commercial sale.
But the rule applies here as well, and I find that manufacturing and
distributing DeCSS software for sale violates the anti-trafficking
provisions of the DMCA. Of identical outcome is the recent decision in
the Northern District of California involving the same software at issue
in this case, the Court issuing an injunction against the manufacture and
distribution of 321 Studios' DVD copying software (see footnote 1,
supra). The Court there found that "321's software is in
violation of both § 1201(a)(2) and § 1201(b)(1), because it is
both primarily designed and produced to circumvent CSS, and marketed to
the public for use in circumventing CSS." See 321 Studios, No.
C 02-1955 SI, at 15.
In the briefing as well as during oral argument, 321 Studios adamantly
insisted that its DVD copying software did not violate the DMCA because
it was not "primarily designed or produced for the purpose of
circumventing CSS" urging it had other diverse uses such as:
The 321 software not only allows for decryption,
it allows for the restoration and retrieval of
damaged DVD[s] that are unworkable, unplayable,
skippable, and they can restore it to viewable
conditions. . . . [Y]oung children play with them,
they get scratched, you take a DVD out of the
plastic case and sometimes they are hard to get
out, they can crack and chip and warp, and there
is a process of delamination.
February 5, 2004 Transcript at 8.
However, prohibition of manufacture or trafficking of any
technology primarily designed to circumvent a technological
measure that either controls access to or protects a right of a copyright
owner to or in a work protected under the DMCA, obviously is not evaded
by the existence of arguably limited alternative uses.
As the Court found in Reimerdes, "the only purpose or use of
DeCSS is to circumvent CSS. . . ." Reimerdes, 111 F. Supp.2d at
319. I agree here.
The constitutional issues raised by 321 Studios are answered by
Universal City Studios, Inc. v. Reimerdes, 111 F. Supp.2d 294
(S.D.N.Y. 2000), aff'd Universal City Studios, Inc.
v. Corley, 273 F.3d 429 (2d Cir. 2001), see also 321
Studios, No. C 02-1955 SI (N.D. Cal, 2004).
Accordingly, plaintiffs' injunction is granted, and 321 Studios, and
its agents, servants, employees, officers, attorneys, successors,
licensees, partners, and assigns and all persons acting in concert with
it, are enjoined and restrained from:
1. Manufacturing, importing, offering to the
public, facilitating, encouraging the use of,
linking to, providing or otherwise trafficking in
DVD X Copy Platinum, DVD X Copy Gold, DVD X Copy
Xpress, DVD X Copy, DVD Copy Plus, SmartRipper,
CladDVD, or DeCSS, or functionally equivalent
2. Pending further proceedings herein, the above
are also restrained from directly or indirectly
transferring abroad, assigning or selling to a
foreign corporation, individual or entity,
otherwise disposing of, by transfer outside of the
United States and its territories, any funds,
assets, monies, securities, claims, or other real
or personal property, located in the United
States, owned by, controlled by, managed by or in
the possession or custody of 321 Studios and its
affiliates without prior application to and
consent of this Court for which jurisdiction is