Disney's Lawsuit Against Redbox Could Have Unexpected Side-Effect

Disney's Lawsuit Against Redbox Could Have Unexpected Side-Effect

posted Saturday Feb 24, 2018 by Scott Ertz

Disney's Lawsuit Against Redbox Could Have Unexpected Side-Effect

Often times, when a company files suit over copyright claims, the end result is predictable. For example, when Disney sued Redbox for reselling the digital distribution codes that are bundled with DVDs, most of the industry saw what was going to happen: Redbox was going to stop selling the codes. Obviously, the codes come as a package deal with the DVDs, so it should be a slam dunk, right?

Wrong. Federal Judge Dean Pregerson decided to throw a surprising wrench into the works during an initial hearing where Disney was looking to stop Redbox's practice during the trial. The judge used a mostly unknown and almost never used aspect of copyright law, which states that enforcement can be prevented if the copyright is being misused. In this case, the judge believes that tying the ownership of the digital distribution to the ownership of the physical discs was a misuse of copyright law.

Obviously Disney intends to appeal this ruling, for a number of reasons. If this ruling were to be allowed to stand, it would have sweeping implications across a number of industries. Let's start with the most obvious: Hollywood. If the ownership rules were to allow the discs and digital to be split, the immediate response would be for the bundles to stop. The only reason you get the digital version for free is because it is a single owner.

Possibly more importantly, there are a tremendous number of products that bundle software that is not allowed to be split. For example, you buy a digital camera, it might come with a free copy of Adobe Photoshop Elements. We all know that you cannot resell that copy of Photoshop, but with this ruling, that may no longer be the case. That free videogame that came with your videocard? Same thing might apply there.

With a change in copyright enforcement, stemming entirely from this case, might come a change in how we purchase products. DVDs may no longer come with digital download codes. Videogames may no longer come with DLC download codes. Videocards may no longer come with a free videogame. Commercial network hardware may not come with the management software. This could be a game changer that none of us expected to see.

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