SALT LAKE CITY — VidAngel has been embroiled in a lengthy copyright lawsuit against some heavy-hitting Hollywood studios for the last few years. Now, a California judge has ruled that the Provo-based company is liable for copyright infringement and may be facing serious monetary damages.
A summary judgment issued Wednesday in favor of Disney, Lucasfilm, 20th Century Fox and Warner Bros. found that VidAngel violated copyright law and the studios’ public performance rights. The ruling also dismissed VidAngel’s arguments that the company’s actions were protected by the 2005 Family Movie Act and fair use law.
It was back in 2016 when VidAngel first became entangled in the lawsuit after several Hollywood studios filed a complaint that the service was unlawfully reproducing copyrighted works owned by the studios, then releasing the videos even before they became available on licensed streaming services.
Prior to the lawsuit, VidAngel offered a service that allowed the customer to “buy” a DVD for $20, choose which parts of the movie they wanted to filter out, then stream it through the VidAngel platform. After the customer was done watching the movie, they could sell it back to VidAngel for $18 or $19 — meaning customers could stream almost any movie for $1 or $2.
The California judge ruled that this method violated copyright law under something called the Digital Millennium Copyright Act because VidAngel circumvented “technological protection measures” on the discs by using software to upload the files onto a computer and manipulate the discs content to allow customers to filter different parts of the movie.
The Family Movie Act allows consumers to filter “limited portions” of an authorized copy of a movie for home viewing or to create a computer program or technology that filters content but doesn’t make a copy of that content.
The ruling claims VidAngel is filtering unauthorized copies of movies because they circumvent the “technology protection measures” to create those copies.
“Where is the copy that’s authorized for making imperceptible changes?” VidAngel CEO Neal Harmon said. “They have yet to show us where that exists for streaming.”
“(The) rulings have rendered the 2005 Family Movie Act meaningless, subverting the will of the people as expressed through their elected representatives in Congress," Harmon said in a news release. "We are renewing our call for leaders in Washington, D.C., to take decisive action to preserve the right they intended to afford families by passing the Family Movie Act Clarification bill, first introduced last year."
VidAngel allows users to filter content from movies and TV series on streaming services like Netflix and Amazon — though they do not filter any films produced by any of the studios involved in the lawsuit.
“The court also refused to modify what we believe is an unconstitutionally broad injunction that is keeping VidAngel from streaming Disney (Fox) and Warner Bros. content using our new system, which means we still cannot filter many titles on modern devices,” Harmon wrote in a blog post Friday.
Harmon says VidAngel does not currently anticipate any legal struggles with their new system. The Provo company has also produced some of their own films as well as a clean comedy series called “Dry Bar Comedy.”
VidAngel did file for Chapter 11 bankruptcy in October and crowdfunded to pay legal fees earlier, but Harmon said in a 2017 blog post that the company “is not going away.” Rather, VidAngel is taking time to reorganize its business plan, he said.
The company may need to do some serious restructuring, however, as the court will decide on June 11 what monetary damages the company will face.
“A jury will decide whether VidAngel’s copyright infringement was innocent, ordinary, or willful, which could result in the following damages:
- Innocent Infringement: Roughly $200 per title
- Ordinary Infringement: Between $750 and $30K per title
- Willful Infringement: Between $30K and $150K damages per title
"Finally the jury will also decide the damages for DMCA violations, for which Disney may be awarded between $200 and $2,500 per title. Disney and others are claiming infringement of approximately 800 titles,” Harmon writes in his March 8 blog post.
Disney is asking that VidAngel be found of willful infringement, though Harmon says they did so “innocently, believing that the law protects our service.”