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Zediva Fights Back Against Studios

23 Jun, 2011 By: Chris Tribbey

Web DVD streaming service Zediva has come out swinging against the Motion Picture Association of America, or MPAA, arguing in court documents that the studios are trying to stifle innovation and have no standing to ask a judge to shut the service down.

Zediva rents new-release DVDs over the Internet by streaming the film while the DVD plays in a DVD player. Zediva argues that because only one person can rent one DVD at a time, its service is no different than any other rental service. The studios have asked the judge in the case to shut Zediva down, arguing that Zediva’s business model constitutes public performance, and isn’t protected under the First Sale doctrine.

“As they have so many times before, the studios seek here to put a new and innovative competitor out of business before a final determination on the merits is reached. They should not be permitted to do so,” the latest court filing reads. “Zediva does not make ‘public performances’ of the studios’ movies, and certainly does not do irreparable harm.”

Zediva argues that it’s just the latest in a long line of business models that Hollywood has tried to shut down, pointing to VCRs, cable companies and DVRs.

“It is not illegal to rent movies to others without the copyright holder’s permission,” the suit reads. “Blockbuster is free to rent the same movie to many different customers in its stores. Netflix is free to mail DVDs to its rental customers. They must buy the DVDs from the studios, but once they do, the studios have been paid, and they have no right to demand a share of the rental fee.”

Zediva suggests its business model is just like Blockbuster and Netflix, with the only difference being that Zediva brings the DVDs to consumers via the Internet. When a consumer rents a DVD via Zediva, he or she is given control of the DVD player, and only when the consumer is finished with the DVD can someone else rent it out.

“Zediva does not infringe the studios’ right of public performance by making this system available to its users, for two principal reasons: The system permits only private transmissions, not public ones, and those transmissions are made as a direct result of the user’s volitional conduct, not Zediva’s,” the legal filing reads.

Zediva asks the court to dismiss the MPAA’s demand for an injunction.

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