Category Archives: Legal Battle

Those posts that are relevant to the legal battle.

Disney v VidAngel Trial – Jury Question

2:18 PM MST UPDATE: About 2pm LA Time – Jury sent a request for an exhibit that contains the Family Movie Act. Both sides argued as to the better exhibit to give to the Jury. The Judge decided to send two exhibits back to the Jury room. Both sides got to review the document before it was sent back to the bailiff, who then gives it to the Jury.

There is a very meticulous process for receiving and sending information to the Jury room.

Disney v VidAngel Trial – Day Five Midday Update

This morning the judge reviewed jury instructions and the verdict form with both sides. After hearing the parties’ motions for adjustments to the jury instructions, Judge Birotte welcomed the jury back to the trial. He read them the instructions, after which Ms. Blanca Young presented Disney’s closing argument and Mr. Mark Eisinhut presented VidAngel’s closing argument. Finally, Ms. Young offered a 10 minute rebuttal. Following the argument, the bailiff was sworn into office to ensure that no one interacts with the jury until their verdict has been reached.

 

We are now waiting for the jury to deliberate. Thanks to all for your support and prayers.

Disney v VidAngel Trial – Continued to Monday

Four witnesses testified yesterday, after which the parties “rested” and the judge asked us to return at 8:45am on Monday morning.  Here’s how Friday went:

Liz Ellis completed her testimony following a relatively brief cross-examination and short re-direct.

Called David Quinto to testify next.  He explained his history representing intellectual property owners and then described how he analyzed the Family Movie Act.  He also explained the events that led up to the enactment of the FMA and the various notifications VidAngel had sent to the studios.  Kelly Klaus attempted to impeach him by saying that he had a reputation for being “aggressive” and suggesting that the pre-litigation letters he sent to the studios asking them to advise VidAngel of any complaints they had concerning its service were “set-up” letters.  Quinto responded by testifying that it is a lot less expensive to avoid conflict than to engage in it.

Jeffrey Harmon testified next, describing his life growing up in a small town, his family’s desire to watch clean content, and the prohibition he and his siblings had on watching pg-13 content until they were 17.  He further testified concerning the harms that watching unfiltered content can cause, his personal interest in watching clean content, and the honesty of his brother Neal who spent 7 years re-paying investors in a failed venture even though he had no legal obligation to do so.  He also testified that Harmon Brothers provided marketing services to VidAngel at cost.

Finally, plaintiffs’ expert Robin Russell testified again, this time to rebut testimony given yesterday by VidAngel expert Jeff Kinrich.  Her criticism focused largely on Mr. Kinrich’s failure to account for black-out periods in his analysis of the studios’ lost profits.

Following her testimony, the parties rested.  The court then heard argument on proposed jury instructions before directing counsel to return at 8:45 a.m. Monday for further discussion of the jury instructions and verdict forms, to be followed by instructions to the jurors (ordered to report at 9:30) and closing arguments.  After that, the jurors will begin their deliberations.

 

 

Disney v VidAngel Trial – Day Two Update and Day Three Schedule

Day 2 of the trial consisted of three testimonies. We heard from William Barnett, Jarom McDonald, and ended the afternoon with a testimony from Neal Harmon.

*The court issued an order excluding witnesses from the trial, which prevents them from having access to the testimony of other witnesses before they testify. Unfortunately, this means we can’t give you access to the daily transcripts yet. But the process is meant to achieve justice so we, of course, will respect it.*

For those of you in the area, we would love to have you join us this week. Today, June 13th will be in Courtroom 7B and is scheduled to begin at 9:00 A.M. and will go until 3:00 P.M. You are not required to stay the whole day – please feel free to come whenever your schedule allows.

For those of you not in the area, we are grateful for the support you have given from wherever you are! We appreciate all of the uplifting comments, good vibes and prayers that have been sent our way.

Disney v VidAngel Trial – Day One Update and Day Two Schedule

We meant to publish this last night, apologies for the tardiness and thank you for the messages you’ve all sent supporting us. Also, thank you to those who came yesterday.

Day One Update

Here’s what I remember happening on day one:

 

  • – The judge wished our Chief Legal Officer, David Quinto, a happy birthday

 

  • – After hearing argument from both sides, Judge Birotte decided that Disney can seek DMCA damages as well as copyright damages, but that both will be decided by the jury

 

  • – Jury members were selected to create a fair and impartial jury – this was the most interesting part of the day.
    • – – Judge Birotte gave a stirring speech on the right to a trial by jury granted by the United States constitution, shared about his immigration from Haiti and thanked the jurors for being there. (I felt a lot of gratitude for our country during this part)
    • – – Twenty potential jurors came to the courtroom and sixteen of them were called at random to sit in the jury box and answer questions
    • – – Those he asked individual and group questions to allow the parties to learn about them
    • – – One juror asked to answer a question privately and the judge created a static sound and met with the judge off to the side (the court reporter still recorded what was being said)
    • – – After a fair amount of discussion with counsel from both sides (again with the static sound playing), the judge eliminated eight jury members
    • – – 8 jury members were then sworn in

 

  • – Judge presented the format, which is:
    • – – 20 minute opening statements from both sides
    • – – up to 6.5 hours of evidence and cross-examination from the Disney
    • – – up to 6.5 hours of evidence and cross-examination from VidAngel
    • – – rebuttal evidence from Disney if time permits
    • – – 40 minute closing statement from Disney
    • – – 40 minute closing statement from VidAngel
    • – – 10 minute rebuttal from Disney

 

  • – Two witnesses were called to the stand to testify for the studios:
    • – – Robert Schumann – expert on technology – about 1 hour for testimony and cross-examination
    • – – Tracy Myers – representative from Warner Bros. – about 30 minutes for testimony and cross-examination

 

The court issued an order excluding witnesses from the trial, which prevents them from having access to the testimony of other witnesses before they testify. Unfortunately for customers and fans, this means we can’t give you access to the daily transcripts yet. But the process is meant to achieve justice so we, of course, will respect it.

 

So that’s all the detail I can muster for now. Join us in the courtroom to experience the trial first hand.

 

Evidence Time Remaining:

Disney: about 5 hours 30 minutes

VidAngel: about 6 hours

Day Two Schedule

Time: 1:30pm-5pm

Location: United States Courthouse, Courtroom 7B, West 1st Street, Los Angeles, CA

Trial Begins June 11th, 2019

 

Thank you so much for your continued support for VidAngel!

For those in the Los Angeles area, we want to invite you to join us June 11th – 14th at the United States Courthouse in Los Angeles for the trial.

We believe in strength and numbers, and would love to have you there to support us! You are not required to stay the whole day – please feel free to come whenever your schedule allows.

Start times are subject to change based on the Judge’s schedule, so we will send you an update each night to let you know what time the trial will begin the next morning.

If you are unable to attend the trial, but would like updates, check back here daily for an overview of what is going on. We will be updating our blog daily during the week of the trial.

If you believe in a higher power, please send prayers! If not, please send all the positive vibes sent our way. We appreciate you all so much.

Neal Harmon

Co-founder & CEO

 

 

VidAngel CEO Neal Harmon: Copyright Infringement Ruling, and Where We Go from Here

Wednesday night, a Los Angeles Federal Judge ruled that VidAngel is liable for copyright infringement for having used a disc-based model during 2015-16. 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.

 

We find the Court’s rulings, and the implications of those rulings troubling. Despite these setbacks, we plan to appeal. The trial is currently scheduled for June 11th, where a jury will decide damages (more detail in the questions listed below).

 

We pray that where a door has closed, a window will open. Meanwhile we offer all the great non-Disney content like Netflix, Amazon Prime, Sony, Universal, Paramount, Lionsgate and many more when you connect your VidAngel account to your Netflix or Amazon account.

 

Where We Go From Here

Despite the setback in the courts, VidAngel continues forward with its successful business.

 

We thank the millions who have and continue to use and support VidAngel, who have more recently enjoyed watching or listening to Dry Bar Comedy, and those who have now backed our original TV series called The Chosen. We will continue to improve the ways in which we try to help you make entertainment good for your home for decades to come.  

 

It’s your home. We are your guest. And we remain committed to earning your trust.

 

Sincerely,

Neal Harmon

Co-founder and CEO

VidAngel

 

 

OTHER QUESTIONS

Why Did We Create VidAngel?

We created VidAngel to help you make entertainment good for your home. As parents ourselves, we needed better home-friendly media options for our own families.

How Did We Get Here?

Since 2013, we have tried multiple methods to skip and mute content (Chromecast, YouTube, Google Play licensing, DVDs and Blu-rays, asking the studios and now by connecting to Netflix or Amazon Prime), and later making content ourselves based on what we learned from you (Dry Bar Comedy and The Chosen).

In July 2015, when we developed a new technology, we wrote the studios asking both for feedback and for them to partner with us; they said nothing. We launched our fourth attempt at a service (after the previous three hit insurmountable studio roadblocks) and over a million Americans signed up. According to UCLA professor Doug Litchman, VidAngel users skipped everything from the “f-word” (26,425,075 times) to the Lord’s name in vain (25,856,107 times) to violence (12,080,274 times) and nudity (5,009,513 times).  

Roughly a year after we had asked them to partner with us, Disney finally responded… by suing us in federal court, alongside Fox (whom Disney later acquired) and Warner Bros.

What Other Details Are There About The Case?

The Ninth circuit said ours is a case of “first impression,” which means this issue had never been reviewed or decided by a court.

We were grateful for the incredible outpouring of support when we were sued. Dozens of prominent faith leaders, Members of Congress, and tens of thousands of families families showed up to help. We even had tens of thousands donate to fund the litigation, letting the courts and our elected representatives know where they stand.

Late 2016, Disney succeeded in getting the fourth, disc-based VidAngel system shut down in court. So we built yet another system to connect to Netflix, Amazon Prime, and other streaming providers.

How Do Damages Get Decided?

A trial is scheduled for June 11th where 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. Inexplicably, Disney is also asking that we be found to have infringed willfully—which means they claim that we intentionally broke the law. We say we did so innocently, believing that the law protects our service. As has been the case since the lawsuit began, we disagree with Disney.

We are grateful that in the United States of America, we don’t handle disputes like these with fists or guns, but in courts of law, and before a jury of every day people who live and work just like us.

How Does Chapter 11 Fit In?

We filed for Chapter 11 protection in Utah to get a temporary reprieve from expensive litigation, allow us to develop our business, and ultimately make the studios whole if we ended up being wrong on the law. After the jury decides damages, a Utah judge will decide our schedule for paying it off. It is wonderful that our country offers Chapter 11 to give companies like Delta, Marvel, and VidAngel a second chance.

What Are You Doing In Congress?

Last year, former Representative Mia Love (UT-04) and the entire Utah delegation introduced H.R. 6816 in Congress to help American families watch filtered content on modern devices. Now that she is no longer serving in Congress, we hope to find someone like Mia Love to pick up the baton to get such a law passed in this Congress.  

Happy New Year from VidAngel! Overview of 2018

VidAngel Supporters,

As the fireworks subside celebrating the New Year, it’s time to reflect what we’ve accomplished together at VidAngel in 2018.

 

The Chosen – closing at midnight tonight – over $8 million* so far!

The Hollywood Reporter and CBN have both published great stories about breaking the all-time record for crowdfunding on any media project. 

Finally, today is the final day The Chosen will accept investment agreements.  It is conducting an unprecedented 6-hour live streamed marathon tonight beginning at 9pm EST. Join the live stream to ask the director anything you want and have your questions answered in real time.

*Amount raised is an estimate that includes subscriptions and founders’ contribution, however not all such amounts have been accepted or closed, and some subscriptions may not be accepted.

 

 

Dry Bar Comedy – Over 1 BILLION views

Our hit comedy series grew explosively in 2018, propelling VidAngel to cash flow positive and prompting a national tour for 2019.  It’s hard to describe what a live night at Dry Bar is like so make sure you experience it when it comes to your town.

 

Here are some of Dry Bar Comedy’s 2018 highlights:

 

  • 1) Top-10 Title on VidAngel. Four or five of the most popular titles on VidAngel are consistently Dry Bar Comedy specials (competing with Stranger Things, Jack Ryan and Game of Thrones). We don’t show them in the most popular category on the app anymore because they were dominating the section. But they are still the most popular.
  • 2) 4 Million Followers. More social media followers than Brian Regan, Jim Gaffigan, Jerry Seinfeld, and Dave Chapelle combined.
  • 3) Sirius XM Radio Deal. We partnered with SiriusXM radio to allow people to listen to Dry Bar Comedy on satellite radio. Listen to it on channel 98.
  • 4) Audio Apps. Do you have one of those home devices? Here are some commands to test the new Dry Bar Comedy audio apps on your home device or cell phone (these are in EARLY testing, so we look forward to your feedback):
    • “hey Google” followed by “Ask Dry Bar Comedy for jokes”
    • “Alexa” is currently reviewing our app. When it is approved, you can use the same phrase as Google.
    • “Siri” followed by “Play Dry Bar Comedy”
  • 5) Cash Flow Positive. We invested millions into Dry Bar Comedy and now, as we start Season 4 next week, it’s generating millions in revenue. And almost all of January tapings sold out weeks in advance.

 

VidAngel Studios

We are in the final stages of FINRA and the SEC regulatory approval for a crowd-funding portal that will allow everyone to support numerous crowd-funded media projects such as The Chosen.  There are a number of projects that we haven’t been able to announce yet. However, we plan to officially launch the crowd-funding platform for VidAngel Studios early this year.

Legal Battle  #SaveFiltering

The stay (that we were afforded thanks to Chapter 11) has been lifted on the Disney lawsuit and we’re back at it in the courts as a much healthier company. In 2017 we did about $2.7 million (and suffered decreasing cash reserves every month) but in 2018 we did over $7.5 million (and our cash reserves began increasing again).  What is most astounding is that we achieved that while filtering only half the content we previously offered on VidAngel!

 

We plan to fight for the right to filter all content on modern devices until we are confident that the future of filtering is secure.  Even without filtering for Disney/Fox/WB content, it is no longer all or nothing because the rest of VidAngel’s business is thriving. And we will continue to ask Congress to clarify the law as we grow.

 

Finally, we also hope to emerge from Chapter 11 soon, maybe even this year.

 

Happy New Year!

Thank you for all your support. Without your help, we wouldn’t be able to continue fighting to make entertainment good for your home. 2018 was a great year and we expect 2019 to be even better.

 

We hope to see you any time on The Chosen 6-hour live stream tonight at 6pm PST or 9pm EST

 

Onward and upward,


Neal Harmon, Co-founder and CEO