RealDVD Legal Bill: $6M and Counting

By : Erik Gruenwedel | Posted: 11 May 2009
egruenwedel@questex.com

Taking on Hollywood can be detrimental to the bottom line.

RealNetworks said ongoing legal fees, totaling $6 million, in the RealDVD copying software trial against major studios contributed to the Seattle-based digital media company posting a first-quarter (ended March 31) loss of $12.1 million, compared to net income of $2.4 million during the prior-year period, according to a regulatory filing.

Among issues in the San Francisco trial, which began April 24, is whether RealDVD could differentiate between a rented or purchased DVD, thereby opening the door for “rent, rip and return” abuses.

The studios said “no,” and a federal judge agreed, issuing a temporary injunction against the $30 software that allowed users to make a digital file of DVD content and save it to their PCs.

RealNetworks’ CEO Rob Glaser, in court, has acknowledged the software couldn’t safeguard against those who would knowingly violate copyright law.

The trial is expected to conclude this week.