VidAngel, a Utah business that caters to customers who want to stream and filter out objectionable content in films and shows, has lost another round in court in a copyright infringement dispute with Disney and three other California entertainment companies.
On Thursday, the 9th U.S. Circuit Court of Appeals upheld an injunction stopping VidAngel from offering video content from the companies until an ongoing lawsuit between the parties is resolved.
In response to the decision, the Provo-based VidAngel — which had appealed the injunction — issued a statement saying the company is still in business and prepared to take its case all the way to the U.S. Supreme Court.
“On the legal front, we are just getting started,” Neal Harmon, VidAngel CEO, said in a written statement. “We will fight for a family’s right to filter on modern technology all the way.”
Before the injunction was issued, VidAngel allowed customers to virtually “buy” movies for $20, select which parts they wanted to filter out — such as violence, nudity, specific curse words — and then “sell back” the movie for $19 worth of VidAngel credit after watching.
The four Hollywood studios — Disney Enterprises, Inc., Lucasfilm Ltd. LLC, Twentieth Century Fox Film Corporation and Warner Bros. Entertainment Inc. — filed suit last year in Central California’s U.S. District Court alleging VidAngel was streaming and altering content produced by the studios without permission and had failed to pay for movie and television rights.
The suit disputes claims by VidAngel that its actions are legal because the Utah company sells instead of rents programs to users. VidAngel operators can offer a cheaper rate than other streaming sites because it has not paid the same fees, which “blatantly violates the Copyright Act and confers on itself unfair and unlawful advantages,” the studios allege.
VidAngel filed a counterclaim in July 2016 asserting that its actions and business plan are legal under the Family Movie Act of 2005, which allows consumers to skip objectionable audio and video content in motion pictures without committing copyright infringement.
U.S. District Judge André Birotte Jr. rejected VidAngel’s argument that it was exempted from liability under the act and issued the injunction, which temporarily bars the company from circumventing technological measures that control access to copyrighted works on DVDs and Blu-ray discs owned by the four companies; copying those works; or streaming, transmitting the works electronically.
In its 3-0 ruling, the 9th Circuit agreed with Birotte that VidAngel’s service does not comply with the express language of the act, which requires a filtered transmission to come from an authorized copy of the motion picture.
VidAngel argues that because it begins its filtering process with an authorized copy — a lawfully purchases disc — “any subsequent filtered stream” also is from that authorized copy, according to the 9th Circuit ruling. But that interpretation would create a “giant loophole in copyright law” and sanction infringement if a copy of the work was lawfully purchased at some point, the ruling says.
“VidAngel does not stream from an authorized copy of the Studios’ motion pictures; it streams from the “master file” copy it created by “ripping” the movies from discs after circumventing their TPMs (technological protection measures),” the ruling says.
In June, attorneys for VidAngel filed a motion asking Birottee to clarify whether the company’s use of a new type of filtering technology, which utilizes existing streaming services such as Netflix, would or would not not violate the injunction. The judge denied the motion on Aug. 2.
Follow @PamelaMansonSLC