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SonicBlue Gets A Reprieve

3 Jun, 2002 By: Holly J. Wagner

A federal judge has spared Sonicblue Inc. from collecting data on ReplayTV personal video recorder (PVR) users' viewing habits, reversing a subordinate's order.

In a ruling delivered to the parties Friday, District Court Judge Florence-Marie Cooper overturned a Magistrate Charles Eick's April 26 ruling, which would have required the company to write and implement software to monitor its customers' viewing habits.

Plaintiffs in the case include Time Warner, HBO, TBS, New Line Cinema, Castle Rock Entertainment, WB TV, MGM Studios, Orion Pictures, 20th Century Fox, Universal Studios, Fox Broadcasting, Paramount Pictures, Disney, NBC, Showtime, United Paramount Network, ABC, Viacom, CBS, Columbia Pictures and ColumbiaTristar.

The studios and networks want to bar SonicBlue from marketing its ReplayTV 4000 because of two features: “AutoSkip,” which lets viewers skip commercials, and a broadband port and “Send Show” feature that let viewers record programs and forward them to friends. They sued SonicBlue, seeking a court order barring further sales of the device.

To prove their point about the harm PVRs cause them, the plaintiffs asked the magistrate overseeing the legal fact-finding process to order Sonicblue to do the data collection. It's that order the trial judge reversed Friday, on the grounds that it would require Sonicblue to create new data, not simply produce existing data from its files. Judge Florence Marie Cooper ruled the data collection would invade users' privacy and that a user survey would adequately provide the data the plaintiffs want.

“This is an important victory for us in the litigation, but most importantly, it's a victory for our consumers,” said Ken Potashner, Sonicblue president and CEO. “We have been, and continue to be willing to work with the content providers to develop new revenue models. If the networks and studios focused on the inevitable evolution of their business instead of attempts to stifle technology, we believe everyone involved would benefit, consumers most of all.”

Privacy and consumer electronics groups argued for the reversal as friends of the court and applauded the decision.

“This decision is a victory for consumers,” said Megan Gray, senior counsel for the Electronic Privacy Information Center. “The prospect of monitoring a consumer's every action simply because they own a product that has been alleged to be susceptible to some uses the entertainment industry dislikes, is abhorrent to constitutional principles. We're glad the court recognized this and overturned the ruling.”

"Forcing a company to change its product in order to conduct surveillance on its customers is unreasonable and inappropriate," said Michael Petricone, VP of Technology Policy for the Consumer Electronics Association. "We were concerned about the potential chilling effects a ruling of this type could have on consumer behavior and technological innovation, and are pleased that it was overturned."

The ruling was a double whammy for the studios, which sought an exemption from having to produce information about their on- and offline business plans and information about the industry's lobbying efforts on Capitol Hill. Applying the same logic, Cooper ruled the studios must respond to those information requests because the information already exists.

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