Click link below to see the Declaration of Neal Harmon:
Dear VidAngel customers,
First, the bad news. The judge has issued a preliminary injunction against VidAngel, requiring that we pull down all the studios’ content. We are seeking a stay of this injunction, but if our efforts fail, we will need to take down the movies of all major studios.
Now the good news. This is the first battle in a long war. We will launch an immediate appeal. And unlike previous filtering companies, we have the funds to fight this all the way to the Supreme Court. We’re committed to protecting your right to watch filtered movies in your home.
In the meantime, we will be finding and creating family-friendly shows and movies so you can still watch quality content on VidAngel. This will be a gradual process, so please be patient with us. We will keep you posted as this develops.
Hang in there,
Neal Harmon, CEO of VidAngel
Spoiler: we believe yes.
Also, a few customers have asked how our court hearing went on November 14th. Here are two updates from the press:
Dear VidAngel customers,
VidAngel is being sued by Disney, Warner Bros., 20th Century Fox, and Lucasfilm. You might be asking, “Are these studios just trying to get buzz by piggybacking on the VidAngel brand?” We’ll let historians answer that.
But first, the bigger question: is VidAngel legal?
We say we’re legal. Disney says we’re pirates. But Disney made Pirates 2 through 4, so who is the real criminal here?
Whatever you believe, know that if VidAngel gets shut down, it’s the end of filtering. Here’s why.
In 2005, Congress passed the Family Movie Act to protect the choice to filter. Just as a director gets to choose what goes into a movie, a family watching at home gets to decide what to mute and skip — and filtering is like a fancy remote to make muting and skipping easier. So everyone has their choice.
Sure, what a director puts in may offend some viewers, and what a viewer takes out may offend some directors. But being offended doesn’t mean you get to make choices for other people, or else college students would rule the world.
Well, Hollywood didn’t like that law, so they signed secret contracts with the Directors Guild and streaming companies to create a “force field” against filtering. The contracts said no one could filter or partner with filtering companies — basically blocking filtering from the whole streaming market.
(We only know all this because Sony got hacked by North Korea and their contracts became public. Probably because North Korea’s a big fan of filtering — just not the voluntary kind.)
And this is where VidAngel comes in — because that force field blocked us 4 times.
- We teamed up with Google to filter their licensed Google Play movies, but Hollywood told Google no.
- We tried to license directly and the studios said no, even though we had the money.
- We tried to buy discs directly and they said no.
- We made a product that let you filter movies you already bought on YouTube. They got it shut down. (Our competitor, ClearPlay, does essentially the same thing, and if they ever get big enough to be a threat, the studios will probably shut them down too.)
Basically, the force field worked. For 10 years no one could stream filtered movies, proving that Disney is so magical they can make Congressional laws disappear.
But the Family Movie Act struck back. Congress already knew Hollywood hated filtering, because before 2005 there had been about a dozen filtering companies, and Hollywood sued — let me check my math — all of them! They sued every filtering company!
So, the Family Movie Act said filtering companies don’t need Hollywood’s permission. They just need to meet 3 requirements:
- The movie is an authorized copy
- Watched in the privacy of the home, and…
- No permanent filtered copy is created
Notice that Hollywood here is like your fiancé’s parents — it’d be nice to get their approval, but if you can’t, you’re still doing this thing. Also, they’ll never give their approval! In my experience.
So what happens when Congress wants a company to exist, but Hollywood doesn’t? Well, it’s gonna be a weird company.
To filter streamed movies despite the Hollywood force field, VidAngel has to buy authorized DVDs and Blu-rays (requirement 1) from retailers, sell them to customers, stream the filtered movie to customers at home (2), without making a permanent copy (3) — meeting all 3 of Congress’s requirements. That’s pretty weird. But weird is not the same as illegal. Just ask Shia LaBeouf.
For instance, it’s weird for a startup to provide $1 movies without the studios’ permission, and to pay by buying discs, instead of licensing. But it was weird when Redbox did all those things too, and they were legal — though the studios tried and failed to shut them down.
It’s also weird that VidAngel decrypts discs. But if you’ve ever used a DVD player, then so have you, and you’re probably legal. So let’s look closer.
First, the discs. A law called the DMCA forbids unauthorized decryption of discs. Here’s why we think VidAngel’s OK.
1. The DMCA doesn’t apply here
Congress wanted the Family Movie Act to protect filtering companies from unfair Hollywood lawsuits. So they made clear that filtering companies meeting those 3 requirements would be immune to Copyright Act lawsuits. And since the DMCA is part of the Copyright Act, it shouldn’t apply here.
But even if it did…
2. Decryption is necessary to fulfill the Family Movie Act
Without decryption, Hollywood’s force field makes it impossible to filter at all. So either VidAngel can legally decrypt discs, or Congress passed a law that didn’t change the law. And you may not like Congress. They still know what laws are.
So we decrypt movies in order to add filters, then re-encrypt them to keep the copyrighted material protected. Plus…
3. VidAngel is legal under Fair Use
The Fair Use doctrine allows companies like VidAngel to use copyrighted works, since our use is transformative and the lawful filtering increases Disney’s movie sales.
- The DMCA doesn’t apply here
- We didn’t break it anyway, and…
- Even if we had, Fair Use makes that legal
So to quote MC Hammer, and those jerks at the Louvre, “You can’t touch this!”
Now, Hollywood claims our reasons are bogus, and decryption isn’t the legal way to stream filtered movies. But when we ask what that legal way is, their only answer is the YouTube method we tried earlier, which they got shut down! That’s like your fiancé’s parents saying, “No, don’t marry this daughter. But how ‘bout this other daughter you already dated, who we murdered?”
In other words, there aren’t other options for streaming filtered movies. VidAngel is filtering’s last stand!
Now, the piracy accusers say we don’t pay Hollywood enough. But remember, we pay them just like Redbox, by buying discs. And just like Redbox, we have to buy a lot or we go out of stock. In fact, we spend about 1/3 of our revenue on discs. So if we’re pirates, then we’re terrible pirates. Just not as terrible as Pirates 2 through 4.
And again, we want to cooperate with Hollywood! We want licensing! But Hollywood seems determined to crush the entire filtering industry.
VidAngel isn’t a loophole! It’s a last resort.
So here’s how you can help:
- Keep using VidAngel and sharing it with your friends. The more customers we bring in, the better. And regardless of what the judge decides, you customers will never be held liable for using VidAngel.
- Go to SaveFiltering.com and sign the petition to help protect VidAngel. Every voice matters.
- Share this post, especially with our critics. We know some people will never love us. But we hope we can convince them we’re not criminals. We’re just trying to protect the personal choice of families.
We’ll keep you posted on the case. In the meantime, thanks for your support. You help make filtering possible.
(This blog post will soon be available in video form.)
Hi VidAngel customers,
Disney and friends have criticized VidAngel’s choice of ad agency. In their last filing, the studios said the owners of VidAngel spend money on their own ad agency to enrich themselves. Which, to be clear, has nothing to do with the legal case and is simply their attempt to smear VidAngel. But let’s examine their claim anyway.
VidAngel was founded by 4 brothers – Neal, Daniel, Jeffrey and Jordan Harmon – three of whom also founded a wildly successful ad agency called Harmon Brothers. That small ad agency has created viral ads for Squatty Potty, PouPourri, Fiber Fix, Purple, and even presidential candidate Gary Johnson (through a Super PAC). Harmon Brothers also helped set a Guinness World Record for orchestrating the world’s largest live nativity with The Piano Guys. Altogether, Harmon Brothers’ videos have received over 300 million views.
And the world has noticed. The Harmon Brothers agency now turns away clients because it simply can’t make campaigns for everyone who wants them. The Harmon Brothers ads have won two Webby awards (sort of an “Oscars” of the Internet). They’ve built two campaigns with over 100 million views, and two of the top 10 most-viewed social media ad campaigns of all time. Forbes says they “may be the best in the business,” and Adweek calls them a viral video “kingpin.”
So when VidAngel needed an ad agency, it seemed like a no-brainer to try out Harmon Brothers. To avoid conflicts of interest, Neal, Jeffrey, and Daniel Harmon recused themselves from any decision-making. Then the deal was approved by VidAngel’s Board of Directors (minus Neal Harmon, who recused himself).
Since then, Harmon Brothers has created a series of successful ads for VidAngel – including “Paintball,” “Angel and Demon,” and “Game of Thronez” – and accrued over 20 million views of VidAngel ads. Within 10 months after VidAngel’s service launched publicly, sales increased by 2,600%. So VidAngel’s advertising expenditures paid off so well that Disney sued us.
Disney is implying that we’re doing something shady. But VidAngel and Harmon Brothers have always made their relationship public. And Disney is trying to take away your right to decide what content enters your home and what stays out. We want you to know our side of the story.
Led by The Parents Television Council and including Enough is Enough, National Center on Sexual Exploitation, the American Family Association, Media Research Center, and other flagship nonprofits, grassroots support for VidAngel continues to grow
National Research Group poll reveals 82% of Values Audience parents are concerned about explicit content in movies and TV shows, and 57 million Americans are likely to use VidAngel’s service
(Los Angeles, CA—September 20, 2016) VidAngel, the market-leading entertainment platform empowering users to filter language, nudity, violence, and other content from movies and TV shows, continues to earn a surge of grassroots support as the company prepares for its preliminary injunction hearing in late October. Disney—along with Warner Bros, 20th Century Fox, and Lucasfilm—has taken legal action to prevent VidAngel from providing families the ability to filter content on modern devices in their homes as explicitly authorized under the 2005 Family Movie Act. Sony, Universal, and MGM chose not to join the lawsuit.
Nearly two dozen leaders of well-known non-profit organizations, led by The Parents Television Council, have publicly expressed their support for and solidarity with the Utah-based startup company. Last week, as VidAngel filed its opposition to the preliminary injunction, many submitted declarations to the court, detailing how the service is clearly in the public interest. Additionally, nearly 30,000 donors from around the nation have now contributed to the company’s growing legal defense fund.
Dr. Jim Garlow, Senior Pastor of Skyline Church in San Diego, heard daily on 800 radio stations nationwide, added his name to the list of supporters, stating:
“VidAngel offers a service that is critically important. Our community, which represents thousands of families, cares deeply about being able to make thoughtful decisions about the entertainment they consume in the home. By empowering our families to filter language, sex, profanity, blasphemy, and other content they object to, VidAngel and other filtering services open up a whole new world of possibility. A world in which we can share important movies and programs that teach valuable lessons, but in a way that is safe for our kids. As I stand with VidAngel as a valuable resource to have, movie filtering is absolutely in the public interest, and can be a vital option to our community.”
Tim Winter, President of the Parents Television Council, states:
“The studios that are suing VidAngel must believe that if a standard is good, then a double-standard is twice as good. When Hollywood believes content should be altered or filtered, they eagerly step in and do it themselves. About a decade ago, NBC secured the broadcast rights to the beloved children’s animated series VeggieTales; but when the network aired the program, they removed references to God—despite the program being created by Christian producers who hoped to share Christian values. And when the television program Duck Dynasty was among the most-watched programs every week, ‘bleeps’ were edited into the programming to suggest harsh profanity was being used, even when no actual profanity was in fact being used. The network wanted to create the false impression in order to bring more ‘edginess’ to the show, despite the fact that the show was so popular precisely because it was squeaky-clean. And on every program on every network, promotional materials are placed above or below the program during its broadcast.
“The ‘altering’ of the producer’s ‘work’ occurs all hours of every day on every network. The notion that Hollywood must vigorously prevent content filtering or editing for the sake of the creative community doesn’t pass the laugh-test.
“VidAngel is the only service that allows consumers to filter out offensive content while streaming the remaining content to their personal viewing devices, wherever they happen to be. VidAngel is clearly operating within both the spirit and the letter of the Family Movie Act. VidAngel allows each parent and each family to consume entertainment content precisely in accord with their unique standards. If the Hollywood studios convince the Court to impede or interfere with VidAngel’s legitimate and lawful business, American families will be deprived of the very right granted to them by Congress in the Family Movie Act.”
Leaders Submitting Declarations
The following is a list of leaders who submitted declarations to the court on behalf of VidAngel last week.
- Tim Winter, President, Parents Television Council
- Patrick A Trueman, President & CEO, National Center on Sexual Exploitation
- L. Brent Bozell, President, Media Research Center
- Andrea Lafferty, President, Traditional Values Coalition
- Bob Waliszewski, Director, Focus on the Family’s Plugged In
- Donna Rice Hughes, President, Enough is Enough
- Gary Bauer, President, American Values
- George Roller, Ambassador, Center for Christian Statesmanship
- Harry Jackson, Bishop of the International Communion of Evangelical Churches
- Matt Kibbe, Chief Community Organizer, Free the People
- Gary Marx, President, Madison Strategies
- Rebecca Hagelin, Author and Family Expert
- David Bozell, President, for America
- Tim Wildmon, President, American Family Association
- Bryan and Diane Schwartz, Founders, Family Goals
- Ted Baehr, Publisher of Movieguide and Chairman of the Christian Film and Television Commission
- David Barton, Founder and President, Wallbuilders
- Rick Green, Host, Wallbuilders Live Radio
- Tim Barton, Chief Operating Officer, Wallbuilders
- Connor Boyack, President, Libertas
The Values Audience: VidAngel’s Core Constituency
The Values Audience is a segment of the U.S. population—52 million adults representing 37% of the entertainment market—whose faith is extremely important to them and is part of their daily lives.
- Almost half (46%) of this segment identifies as Evangelical or “born-again” Christian, compared to 28% among the general population.
- 64% attend weekly religious services,compared to 38% among the general population.
- 52% pray several times a day, compared to 27% among the general population.
- 34% list religious activities as an interest they enjoy (vs.17% among the general population, and 29% attend bible study (vs.14% among the general population).
- The Values Audience is equally split on gender, and skews more towards younger adults. The majority (52%) are under age 34, with 29% ages 18-24.
- 51% of the Values Audience have kids, compared to 40% of the general population. This segment is also more likely to have younger children under age 12 (37% vs. 30% among the general population).
- The majority are Caucasian (57%), but the Values Audience has a higher percentage of African-Americans (18% vs. 12% among the general population), and Hispanics (18% vs. 15% among the general population).
The Values Audience: Deeply Concerned about Content
- 82% of Values Audience parents are likely to say it is “very important” to know about any explicit content before deciding if their child should watch, compared to 72% among the general population.
- 57% of Values Audience adults are much more likely to say it is “very important” to know about any explicit content before deciding whether or not they, themselves, will watch a TV show or movie, compared to 34% among the general population.
- 59% of the Values Audience say they use website resources and tools to monitor explicit content their family watches, vs. only 30% among the general population.
- 64% of Values Audience parents say they use parental controls to monitor and control the TV and movie content their children watch at home vs. 53% among the general population
The next step in the Disney v. VidAngel case is a preliminary injunction hearing to be argued in the Central District of California federal court on October 31, 2016. To view the legal defense fund, click here: https://www.vidangel.com/donate
Dear VidAngel customers,
Some of you have asked why we filed an antitrust suit against the studios. Here’s the simple answer:
Hollywood claims we don’t pay them for their movies. But the truth is, they refuse to accept our payments. (We still pay them though. Read on.)
Beginning in 2014, VidAngel tried to pay the studios 4 different ways. Not only did they reject every one, but then they sued us for allegedly not paying them. So Hollywood’s like the teenage girl who keeps turning down the nice guy, then complains that he never asks her out, then sues him for copyright infringement.
Look, we love Hollywood. We’re glad they make movies. But the fact is, they seem to be working to shut down the filtering industry. Here are the 4 times they rejected our payments.
Method 1: Traditional streaming license
VidAngel offered to buy traditional streaming licenses from the studios, but the studios said no. We get it — why partner with such a small company? Except we also reached out through a bigger company called Google. (A cool emerging tech company. Bing it.)
Google approached the studios with a plan to add VidAngel filters to Google Play movies, potentially bringing millions of new viewers to the licensed Google Play streams. The studios turned them down almost immediately.
And bear in mind, the U.S. filtering market is estimated at over 60 million people, according to National Research Group. So if Hollywood said no, they likely either…
- Want to block the filtering industry from entering the streaming age, OR…
- Want to avoid money and its corrupting influence
For now, we’ll give the benefit of the doubt and say #2.
Anyway, we also tried…
Method 2: YouTube extension
We created a platform that allowed viewers to buy a movie on YouTube, then buy the filter at VidAngel and add it to the movie. We hoped to bring Hollywood more money by attracting new viewers to their content.
Then the studios told Google (YouTube’s owner) that collaborating with VidAngel was a violation of contract, and forced them to withdraw crucial tech support. All of a sudden this model wouldn’t work.
“Wow,” we said. “We admire Hollywood’s moral commitment to not making money.” It certainly explained the release of Fantastic Four.
Nevertheless, we kept trying.
Method 3: Buying discs straight from the studios
This time we wrote to the studios asking to buy DVDs and Blu-Rays from them directly, so our customers could buy and sell back those movies online. This model would make money for Hollywood on each title, without giving a cut of sales to WalMart.
Some studios said no. Most never responded.
“Man,” we said, “their hatred of lucre is incorruptible. No wonder they can’t afford to pay actresses the same as actors.”
So nowadays we use…
Method 4: Our current model
VidAngel now buys DVDs and Blu-Rays from retail stores, then sells movies directly to customers. Hollywood gets reimbursed by the sheer number of movies we buy (we spend around ⅓ of our revenue on discs). And every VidAngel movie being watched is a licensed copy. It’s literally the only legal model that doesn’t require Hollywood’s cooperation.
We felt proud of ourselves for finding a way to pay Hollywood, despite their best efforts to not be paid. Then they sued us.
And here’s where things really get ironic.
Not only did the studios show significant hypocrisy in suing VidAngel for not buying licenses that they refused to sell — but they also claimed that Method 4 was illegal and that Method 2 was the legal way to filter streamed movies. To which we said, “Homeboy, we tried Method 2 and you shut it down!” We’re paraphrasing here.
Hollywood also implied that they sued us as soon as they learned we were using Method 4. The truth is that Albert Podrasky, Disney’s director of anti-piracy, has been using a secret VidAngel account to monitor us for a full year! (Though we’re not sure we understand his job, ‘cause he never watches movies about pirates.) The point is, it seems like Hollywood didn’t sue till we were getting too big for their comfort.
Anyway, the studios’ lawsuit has made us question our base assumptions. Maybe Hollywood actually likes money, and they’ve been shutting us down because they hate filtering. If that’s the case, we respect their opinion — filtering’s not for everybody. But they should come out and admit that they hate filtering, instead of pretending the case is about money.
In short, it seems to us that Hollywood is colluding to undermine the filtering industry — despite Congress passing the Family Movie Act to make that industry a reality. (In fact, Congress passed the law because Hollywood was trying to crush filtering.) That’s why we filed an antitrust counterclaim.
So that’s the scoop, VidAngel fans. Wish us luck in the antitrust suit. In the meantime, keep watching movies. We’ll keep you posted.
Dear VidAngel customers,
4 Hollywood studios have accused VidAngel of stealing their movies. That’s not true, but we are stealing their lawyers.
This week Attorney David Quinto, who used to be a lawyer for Disney and Warner Brothers, became the official lawyer of VidAngel. As you may recall, those studios and VidAngel are currently in a legal battle, so Quinto’s pulling a Kevin Durant and switching teams to the inevitable winners.
David Quinto is a fairly big deal.
The Hollywood Reporter named him to their list of Top 100 Power Lawyers. In fact, he was ranked #21 on the alphabetical list!
He spent 27 years as a lawyer for the Oscars, and during that time they never got sued for giving Best Actor to Nicholas Cage, so you know he’s good at his job.
He has had adventures in 140 countries during his life, including:
- Outrunning a knife-wielding assailant for close to a kilometer in Rio de Janeiro
- Escaping the Tuareg insurrection by fleeing Timbuktu aboard a Russian military cargo plane
- Spending a month in Argentina during the height of the Dirty War and almost being executed in Mendoza (without cause, we should note)
- Litigating his first case while still in law school and earning two published opinions, one of which has been cited by the Supreme Court
These are all true stories. No, WE PROMISE. They really are!
Welcome to the family, David!
With more than three decades of experience, known both for representing Hollywood studios–including two of the plaintiffs in the VidAngel case–and for protecting the ©OSCAR® and ACADEMY AWARDS®, and representing the Producers Guild of America, David W. Quinto joins VidAngel as its General Counsel
LOS ANGELES, Aug. 3, 2016 /PRNewswire/– VidAngel, the market-leading entertainment platform empowering users to filter language, nudity, violence, and other content from movies and TV shows, is pleased to announce that legendary Hollywood intellectual property attorney David W. Quinto, who was long a partner at powerhouse firms Quinn Emanuel Urquhart & Sullivan LLP and Davis Wright Tremaine LLP, has joined VidAngel as its general counsel. Mr. Quinto’s first task will be to spearhead its defense of a lawsuit brought by four major Hollywood studios hoping to enjoin VidAngel from offering its filtering service to the public. With more than three decades of experience in entertainment and intellectual property, including protecting the ©OSCARS, Quinto has focused on copyright, trademark, trade secret, unfair competition, and Internet-based cases.
Mr. Quinto’s first task will be to spearhead its defense of a lawsuit brought by four major Hollywood studios hoping to enjoin VidAngel from offering its filtering service to the public. With more than three decades of experience in entertainment and intellectual property, including protecting the ©OSCARS, Quinto has focused on copyright, trademark, trade secret, unfair competition, and Internet-based cases.
“David’s decision to join VidAngel as General Counsel represents the single most significant development in the case to date. Having successfully represented iconic Hollywood institutions such as the ©OSCAR, the ACADEMY AWARDS® and the Producers Guild of America, as well clients dealing with cutting edge Internet legal issues, there is no one better suited to oversee our legal strategy,” said Neal Harmon, CEO of VidAngel. “David wrote the original legal opinion upon which VidAngel’s business model is based, and today’s announcement demonstrates his full confidence that values consumers seeking to filter content will prevail in court.”
“It is a privilege to be asked by VidAngel to focus on winning a landmark copyright case sure to make new law. I am confident that the studios have overreached by trying to enjoin a service expressly authorized by Congress for the protection of children, and I look forward to the opportunity to demonstrate that in court,” said David W. Quinto, General Counsel at VidAngel.
Respected Los Angeles law firm Baker Marquart LLP will continue to represent VidAngel in defending the lawsuit recently brought against the Utah-based company by Disney, Twentieth Century Fox, Warner Brothers, and Lucasfilm, and in prosecuting VidAngel’s antitrust claim against them. Mr. Quinto will oversee all aspects of the case. VidAngel chose Baker Marquart based on the firm’s litigation successes, including the recent landmark ruling in the Central District of California that FilmOn was entitled to the compulsory license enjoyed by large cable companies that deal with TV networks. The opposing plaintiffs in that case included ABC (a division of Disney) and Fox.
ABOUT DAVID W QUINTO
David Quinto is a veteran intellectual property attorney, with over 33 years’ experience. His practice focuses on copyright, trademark, trade dress, trade secret, unfair competition, and Internet-related matters, as well as general commercial litigation. Over the past three decades, David has represented a broad range of clients, including the Academy of Motion Picture Arts and Sciences (for which he was responsible for protecting the ACADEMY AWARDS® and ©OSCAR® marks and copyright, as well as the annual Academy Awards© telecast), Lockheed/Lockheed Martin, Home Depot, Edwards Lifesciences, Grendene, S.A, Sae-A Trading Co. Ltd., Mattel, Avery Dennison, Bonneville International, GKN Aerospace Transparency Systems (Luton) Ltd., Samsung, ASCAP, the Academy of Television Arts and Sciences, the Producers Guild of America (for whom he obtained the first-ever “No Action” letter for a certification mark from the Antitrust Division of the Department of Justice), and the America’s Cup Organizing Committee.Mr. Quinto is the co-author of the national practitioner’s guide to trade secret litigation,
Mr. Quinto is the co-author of the national practitioner’s guide to trade secret litigation, Trade Secrets: Law and Practice (3d edition published by LexisNexis 2014; earlier editions published by Oxford University Press), which analyzes the ins and outs of trade secrets disputes from the viewpoints of plaintiffs, defendants, criminal defendants, and businesses seeking to avoid or investigate potential misappropriations. Mr. Quinto earlier authored Law of Internet Disputes (3 editions published by Aspen Law& Business) and was a contributing author of Trade Marks at the Limit (Edward Elgar Publishing 2006).
VidAngel is the market-leading entertainment platform empowering users to filter language, nudity, violence, and other content from movies and TV shows. VidAngel’s success has been well documented, earning a #1 BestCompany.com user rating and making VidAngel one of the fastest growing entertainment companies in the U.S.
Hi VidAngel customers,
We have a new pen-pal. Last month, four studios sent a letter saying:
“Dear VidAngel, you are violating our copyrights. Please stop.
Love, Disney, Warner Brothers, Twentieth Century Fox, and Lucasfilm”
So this week we responded:
“Dear studios, no we are not. Also, you’re violating antitrust laws.
Yours truly, VidAngel”
Okay, that’s not word-for-word. But basically, Hollywood said, “Cut it out.” We said, “That’s literally all we do.” (Eh?) And now we’re planning a trip to California to meet our pen-pals in person.
But you want details. Many of you have been asking for a thorough explanation of VidAngel’s legal case. So we’ve organized some of the key arguments below, using quotes from the studios’ complaint and VidAngel’s counter-complaint. Enjoy.
Issue I: Payment to copyright holders
The Studios say…
“VidAngel charges users for watching [the studios’] content but has no authorization and pays nothing for the rights it exploits.
“…[B]y cutting out payments to copyright owners, VidAngel is able to offer prices that undercut licensed services…”
But VidAngel says…
“In fact, the opposite is true. VidAngel spends over one-third of its gross revenues to lawfully purchase thousands of DVD and Blu-ray discs, which are then re-sold to VidAngel users. Shown below is the manager of VidAngel’s storage vault pictured with lawfully purchased copies of The Revenant.
“The majority of VidAngel’s purchases represent sales that would not occur but for its filtering service, because most of VidAngel’s customers would not acquire and watch a particular film without filtering.
“…[The studios] in truth receive the same payment for each of these first sales to VidAngel as they would receive from any [other] lawful first purchaser of their title.”
In other words, VidAngel lawfully reimburses the studios by buying thousands of their discs. The studios’ complaint did not acknowledge this fact.
Issue II: Studio permission
The Studios say…
“VidAngel does not have permission to copy Plaintiffs’ movies and television shows or to stream them to VidAngel’s users…
“By running this service without a license, VidAngel blatantly violates the Copyright Act and confers on itself unfair and unlawful advantages vis-à-vis licensed services in the VOD marketplace.”
But VidAngel says…
“[The studios] repeatedly suggest that VidAngel needs their permission to offer a filtering service, despite Congressional law which expressly authorizes VidAngel’s service without need for any such consent.
“[The Family Movie Act] provides that ‘making imperceptible (i.e., filtering)… of limited portions of audio or video… transmitted [e.g., streamed] to [a] household for private viewing, from an authorized copy of the motion picture’ does not violate the Copyright Act.
“…In asking this Court to impose a consent requirement on VidAngel’s filtering service, Plaintiffs are effectively asking that the Court repeal a federal statute enacted to protect American families.”
Meaning, VidAngel does not require a license to filter a movie that customers have already lawfully purchased. That right is protected by the Family Movie Act.
Issue III: Uploading DVDs and Blu-rays
The Studios say…
“VidAngel appears to circumvent the technological protection measures on DVDs and Blu-ray discs to create unauthorized copies and then uses those copies to stream Plaintiffs’ works to the public without authorization.
“…VidAngel’s circumvention of the [technological protection measures] violates Section 1201 of the [Digital Millennium Copyright Act].”
But VidAngel says…
“In enacting the Family Movie Act… Congress protected the right of families to filter and view content… in Copyright Act Section 110…
“That section provides that [filtering a streamed motion picture, as described above] does not violate the Copyright Act. Because the Digital Millennium Copyright Act is part of the Copyright Act, it is subject to the same exemption.”
“…[The studios] contend that the mere act of creating a decrypted version of a lawfully purchased DVD of their title violates… the Digital Millennium Copyright Act.
“VidAngel contends that the making of a decrypted copy as the necessary first step in making a lawfully purchased DVD capable of being filtered is fully consistent with the [Family Movie Act] and otherwise complies with all copyright laws.”
In other words, VidAngel argues that decrypting DVDs is a necessary step in allowing viewers’ movies to be filtered, and is covered under the Family Movie Act.
Anyway, you know how pen-pals are. Sometimes you have different opinions about whether your business and livelihood should be permanently shuttered by a court-ordered injunction. LOL! Pen-pals!
Stay tuned for further updates, including a future blog post about our antitrust counter-claim. And thank you, VidAngel fans, for your support throughout this process. It means a lot.
Thanks a million,
You can read the rest of our counterclaim here.