The DVD Copy Control Association has sued Kaleidescape over its $27,000 home theater system, accusing the company of offering products that let users make copies of DVDs illegally.
"The express intent and purpose of the contract and CSS are to prevent copying of copyrighted materials such as DVD motion pictures," DVD CCA attorney Bill Coats said in a statement. "While Kaleidescape obtained a license to use CSS, the company has built a system to do precisely what the license and CSS are designed to prevent – the wholesale copying of protected DVDs."
The lawsuit surprised Kaleidescape. "We are flabbergasted by this lawsuit," chief executive Michael Malcolm said in his own statement, adding the company would likely countersue the DVD CCA. "We have gone to great pains to make our system comply 100 percent with licenses and all the associated technical procedures and requirements."
Malcolm said Kaleidescape – which won a Viewer's Choice Award for 2004 from Sound & Vision magazine – designed its products to conform to terms of a DVD CCA license and updated the DVD CCA "repeatedly" on product plans and upgrades.
Kaleidescape's flagship product is a high-capacity home movie server capable of storing hundreds of films at a time, allowing access from different portions of any networked home and to as many as seven movies at a time, which requires copying them from a source DVD. The basic system, able to store 160 films, has sold for $27,000.
This litigation comes at a time when the next generation of DVD is bound up somewhat in a battle of competing high-definition formats. Toshiba's HD-DVD is the leading choice for Warner Bros., Paramount, Universal, and New Line Cinema; while Sony, Dell, and Samsung's Blu-ray has the backing of Columbia TriStar/Sony Pictures, MGM (which Sony recently purchased), and the Walt Disney Company. And 20th Century Fox is also believed to be in the Blu-ray camp, though that studio has yet to make a known formal endorsement.
