Hollywood Studios Rip VidAngel's New Service in Filtering Fight

"[B]y telling its users that its new service is lawful, VidAngel threatens to confuse consumers regarding the legitimate streaming market," Disney's attorney Kelly Klaus writes.
Courtesy of VidAngel

VidAngel struggled to stay in business after a cadre of major Hollywood studios sued the filtering service for copyright infringement — and now the company's newly launched platform is squarely in their sights.

Disney, 20th Century Fox, Warner Bros. and Lucasfilm convinced a California federal court in December to press pause on VidAngel's service until the legal fight is resolved, arguing that the company is nothing more than an unlicensed streamer that flouts the Digital Millennium Copyright Act.

The family-friendly filtering company didn't immediately comply and was found in contempt. It's now even clearer that VidAngel won't wait until the battle is over before figuring out its next business move. It launched a new service on June 13, and asked the court to consider whether the product, which piggybacks on users' Netflix and Amazon accounts, violates the injunction.

The studios were quick to question the legality of the new offering and filed an ex parte motion to strike VidAngel's motion for clarification. U.S. District Judge Andre Birotte denied that request "in the interest of resolving the motion on its merits."

In an opposition filed Monday, Disney minces no words.

"The Court’s Preliminary Injunction Order is clear: it bars VidAngel from circumventing access controls that protect Plaintiffs’ copyrighted works, and from copying and streaming those works," writes attorney Kelly Klaus. "VidAngel’s self-styled 'Motion to Clarify' improperly asks the Court to decide prematurely the legality of modifications VidAngel claims it has made to its unauthorized streaming service."

Further, Disney argues that the motion is improper because VidAngel's appeal of the injunction is pending before the 9th Circuit, therefore that court has jurisdiction. Even absent the jurisdictional conflict, Disney argues the standing injunction still applies to the new process.

"If a VidAngel user has paid for the right to access a stream from Netflix, Amazon or another LSS, the user’s right extends to the stream from the copy controlled by the LSS," writes Klaus. "But VidAngel does not stream from the LSS copy. It streams from the copy that VidAngel created and stores on its own servers. The stream from the LSS, like the unopened DVDs and Blu-ray discs that VidAngel stores in the 'vault,' are not accessed by the user. Like the unopened discs, the stream from the LSS is window dressing for VidAngel’s convoluted, lawyer-driven architecture."

The studios also question how VidAngel's new service works, and claims the company won't give details about the instructions it gives the employees and taggers who access the streams. Klaus argues that information is necessary to determine whether the service is operating in compliance with the DMCA's circumvention guidelines.

"VidAngel has not provided good cause for short-circuiting the litigation process in seeking judicial review of its service in the guise of a Motion to Clarify," writes Klaus. "To the extent there is any question that VidAngel’s service is covered by the Preliminary Injunction Order, Plaintiffs should be permitted discovery into the operation of VidAngel’s system."

Disney also isn't buying VidAngel's argument that more users will subscribe to services like Netflix and Amazon if they're able to apply family-friendly filters to the content. Klaus argues it actually hurts the studios' relationships with legitimate streamers and confuses the customers.

"[B]y telling its users that its new service is lawful, VidAngel threatens to confuse consumers regarding the legitimate streaming market," writes Klaus. "VidAngel has continued to defend its prior streaming service, and the instant iteration of that service, as legal to customers who question it. Consumers continue to reflect confusion regarding whether its infringing service is nonetheless legal."

VidAngel's reply is due July 10, and a hearing on the matter is currently scheduled for July 24. The full filing is posted below.

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