Disney Enterprises, Inc., et al v. VidAngel, Inc.

Filing 57

Submitted (ECF) Amicus brief for review (by government or with consent per FRAP 29(a)). Submitted by ClearPlay, Inc.. Date of service: 02/14/2017. [10319149] [16-56843] (Sableman, Mark) [Entered: 02/14/2017 01:30 PM]

No. 16-56843

United States Court Of Appeals
FOR THE NINTH CIRCUIT

DISNEY ENTERPRISES, INC., ET. AL.,
PLAINTIFFS/APPELLEES,
v.
VIDANGEL, INC.,
DEFENDANT/APPELLANT .
On Appeal from the United States District Court for the Central District of California,
Case No. 2:16-cv-04109-AB-PLA
The Honorable André Birotte Jr., District Court Judge

BRIEF OF AMICUS CURIAE CLEARPLAY, INC.
SUPPORTING PLAINTIFFS/APPELLEES

James M. Burger
THOMPSON COBURN LLP
1909 K Street, NW
Washington, DC 20006
Tel. [phone]

Mark Sableman
THOMPSON COBURN LLP
One US Bank Plaza
St. Louis, MO 63101
Tel. [phone]
Counsel for Amicus ClearPlay, Inc.

February 15, 2017

DISCLOSURE OF CORPORATE AFFILIATIONS AND
OTHER ENTITIES WITH A DIRECT FINANCIAL INTEREST IN
LITIGATION
Amicus Curiae ClearPlay, Inc. (“ClearPlay”) does not have a parent
corporation and no publicly held corporation owns 10% or more of its stock.

i

TABLE OF CONTENTS
DISCLOSURE OF CORPORATE AFFILIATIONS .................................................i
STATEMENT OF INTEREST .................................................................................. 1
ARGUMENT ............................................................................................................. 3
A.

Neither Circumventing Access Controls Nor Making Unlawful
Copies Is Necessary To Filter Videos .................................................... 3

B.

The Family Entertainment and Copyright Act of 2005 by its
Language and by its Legislative History Does Not Exempt
Violations of Other Copyright Act Provisions ....................................... 5

C.

Allowing VidAngel to Circumvent and Make Unlawfully Copy
Videos Disadvantages Competitors Like ClearPlay ............................ 11

CONCLUSION ........................................................................................................ 15
CERTIFICATE OF COMPLIANCE WITH TYPE-VOLUME LIMITATION ..... 16
CERTIFICATE OF SERVICE ................................................................................ 17

ii

TABLE OF AUTHORITIES
Page(s)
Cases
Clean Flicks of Colorado, LLC v. Soderbergh,
433 F.Supp.2d 1236 (DC CO 2006) at 1238 (Soderbergh) ........................... 9, 13
Huntsman v. Soderbergh, et al.,
2005 WL 1993421 (Huntsman) ....................................................................... 5, 8
Federal Statutes
17 U.S.C. § 101 et seq....................................................................................1, 3, 7, 9
17 U.S.C. § 106 ................................................................................................5, 8, 14
17 U.S.C. § 106(1) ..................................................................................................... 7
17 U.S.C. § 110 ...................................................................................................... 6, 8
17 U.S.C. §110(11) ............................................................................................1, 6, 9
Digital Millenium Copyright Act......................................................................... 7, 11
Family Movie Act of 2005 ................................................................................passim
Legislative Materials
Derivative Rights, Moral Rights, and Movie Filtering Technology:
Hearing Before the Subcomm. on Courts, the Internet, and
Intellectual Prop. of the H. Comm. on the Judiciary, 108th Cong.
122 (2004) ............................................................................................................. 7
H.R.Rep. No. 109-33(I) at 2 (2005), reprinted in 2005 U.S.C.C.A.N. ...................... 6

iii

STATEMENT OF INTEREST
ClearPlay, Inc. is a video filtering pioneer. Since 2000, it has been providing
video filtering to allow parents to moderate their children’s video experience.
ClearPlay accomplishes this by muting or skipping specific language or scenes
parents deem inappropriate for their home. Accordingly, ClearPlay has specialized
knowledge of video filtering technologies, the video filtering industry, and the
federal act that governs video filtering, which was enacted in part at its initiative.
In 2004, because of questions raised about its technology, ClearPlay asked
Congress to clarify through appropriate legislation that muting and skipping over
copyrighted content, without making an unauthorized copy did not violate the
Copyright Act (the “Act”).1 The FMA, enacted as part of the Family Entertainment
and Copyright Act of 2005, Public Law 109-9, resulted. Among other things, it
permits filtering technology in accordance with its terms.
ClearPlay believes its technology, industry and legislative insights may be
helpful to the Court, particularly because VidAngel, Inc. has made statements in its
brief that ClearPlay believes misrepresent the industry and ClearPlay specifically.

1

17 U.S.C. §101 et seq.
1

Pursuant to Federal Rule of Appellate Procedure 29(a)(2), all parties have
consented to the filing of this brief.2

No party’s counsel authored this brief in whole or in part. Neither any party nor
any party’s counsel contributed money that was intended to fund preparing or
submitting this brief. No person other than amicus, its members, or its counsel
contributed money that was intended to fund preparing or submitting this brief.
2

2

ARGUMENT
A.

Neither Circumventing Access Controls Nor Making or
Streaming from Unlawful Copies Is Necessary To Filter Videos.

Since 2000, ClearPlay has produced and marketed family-friendly filtering
controls, which neither circumvent access controls nor make copies of copyrighted
material nor make an unlawful public performance. Thus, these three steps, at issue
in this case, may not be credibly claimed as essential for video filtering.
VidAngel’s brief in this court claims that VidAngel’s particular distribution
methodology for streaming video should be excused from violating the Copyright
Act because that methodology is essential for video filtering.3 That claim is
inaccurate. ClearPlay’s technology fully handles video filtering. ClearPlay’s
service works with multiple media—both physical media (DVD and Blu-ray discs)
and legitimate streaming services.
Essentially ClearPlay provides its customers with a technologically assisted
fast-forwarding device, which uses video time codes and knowledge of the location
of material in the video to forward over the specific scenes or mute specific audio.
Because time codes are necessarily integrated between the encrypted content and
the device licensed to decrypt and play or stream the video, ClearPlay can

“VidAngel thus had no choice but to resort to its disc-based model, which limits it
to streaming filtered content based upon the availability of a disc to purchase and
resell.” Opening Brief for Defendant--Appellant at 25-26
3

3

effectively filter the video without circumventing or making unlawful copies or
public performances.
In contrast, to provide its unlicensed streaming service, VidAngel
circumvents the encryption in commercial video discs. It makes a full unauthorized
copy of the copyrighted material on the disc and stores the copy on its server for
more than a transitory period of time.4 VidAngel admits it never streams from the
original disc; but streams from the same unauthorized decrypted server copy to
each customer paying a dollar to watch the DVD.5 When VidAngel customers view
video content, that content comes from the unauthorized decrypted copy, not the
disc that the VidAngel customer had “purchased.”
ClearPlay and VidAngel, in short, both provide video filtering for customers,
but VidAngel provides customers with streams from unlawfully obtained video
copies made on VidAngel’s servers. ClearPlay filters without circumventing
encryption or making unauthorized copies or public performances; VidAngel takes
these three steps. Whatever the legality of VidAngel’s process, it cannot be based
on VidAngel’s unauthorized conduct being essential for video filtering.
As the District Court found: “Assuming arguendo that VidAngel’s buy/sellback
service creates a valid ownership interest in a DVD, this ownership would only
apply to the physical DVD, not the digital content that VidAngel streams to paying
subscribers. Subscribers view a stream from a master copy stored on a server, not a
DVD temporarily ‘owned’ by the user.’” Disney Enterprises, Inc. et al. v.
VidAngel, Inc., ER 11 (Disney).
4

5

SER 1040-41.
4

B.

The Family Movie Act of 2005 by its Language and by its
Legislative History Does Not Exempt Violations of Other
Copyright Act Provisions

VidAngel’s interpretation of the Family Movie Act of 2005 (“FMA”),
contravenes both its clear meaning and its legislative history.
The FMA, which ClearPlay sought, focused on ClearPlay’s technology, and
ultimately validated that technology. It did so without overriding the anticircumvention provisions of section 1201 or the copyright owner’s exclusive rights
in section 106 to reproduce or publicly perform its work in copies.
As background, in 2002, some motion picture directors and studios (“motion
picture parties”) sued multiple filtering companies, including ClearPlay, alleging
that their processes infringed motion picture copyrights.6 This case brought to the
forefront the technical difference between “editing” and “filtering.” There were
accused companies that made and distributed unauthorized edited copies of the
original movies, and as to them the suit focused on those unauthorized copies.
ClearPlay, however, deployed a filtering technology and made no copies of the
movies. As to ClearPlay, the plaintiffs claimed they had copyright rights in the
time codes that ClearPlay used, or, alternatively, that the filtered movie that the
viewer saw through ClearPlay’s filter was an infringing derivative work. ClearPlay
noted, however, that automatic mechanically generated time codes cannot meet the
6

Huntsman v. Soderbergh, et al., 2005 WL 1993421 at 1. (Huntsman)
5

minimal creativity required for copyright, and that the filtered movie seen by the
viewer was not fixed in a tangible medium for “more than a transitory duration” as
required for infringement. Although ClearPlay was confident in its legal position,
ClearPlay brought its concerns to Congress and obtained clarification of the noninfringing nature of ClearPlay filtering.7
The legislative amendment ClearPlay sought, and that which it ultimately
obtained, was framed as a limitation on the exclusive rights of the copyright owner.
The FMA was ultimately codified in section 110 of the Copyright Act, which
already had contained 10 previous such limitations. The FMA limitation, as
ultimately enacted, essentially held that a performance of a movie, within a
household, at the direction of a member of the household, could omit (“mak[e]
imperceptible”) certain portions of the video. 17 U.S.C. § 110(11). This validated
ClearPlay’s filtering process, which lets parents decide what parts of a video will
be omitted when it is played in their house, and does so without making
unauthorized copies or public performances.
ClearPlay’s technology model was front and center during the hearings
leading up to FMA enactment. ClearPlay’s Chief Executive Officer, Bill Aho,
testified before, and was questioned extensively by, the House Judiciary
The FMA “… clarifies the legal status of certain services and technologies that
enable individuals to skip and mute content on certain works in the privacy of their
own home;” H.R.Rep. No. 109-33(I) at 2 (2005), reprinted in 2005 U.S.C.C.A.N.
at 220-221.
7

6

Subcommittee on Courts, the Internet, and Intellectual Property. He made clear the
limitation he was requesting. In his initial oral statement Mr. Aho told the
Subcommittee:
I would like to emphasize the important difference between ClearPlay
and most of the other companies involved in this sector.
Most of these companies make copies of DVDs that they resell as
edited versions. Now, in contrast, ClearPlay neither copies nor edits DVDs.
ClearPlay’s technology is more like an automated fast-forward or mute
button on your remote control or the technological equivalent of covering
your eyes during disturbing scenes, except that we do it in a seamless,
consumer-friendly manner.8
ClearPlay thus presented a simple case for clarification of the Copyright Act,
because its filtering process could be ratified and approved without any effect on
the crucial copyright provisions against unauthorized reproduction or public
performance (section 106(1), (4)) or circumvention of access controls (section
1201). That, indeed, is the step Congress took. It permitted filtering without
making any changes to the copyright owner’s exclusive right to control
reproduction or public performance, or to the access-control protection afforded by
the Digital Millennium Copyright Act (“DMCA”).
The FMA’s actual language plainly reflects an attempt to approve filtering
technology like ClearPlay’s:
Derivative Rights, Moral Rights, and Movie Filtering Technology: Hearing
Before the Subcomm. on Courts, the Internet, and Intellectual Prop. of the H.
Comm. on the Judiciary, 108th Cong. 122 (2004) (oral testimony of ClearPlay
CEO Bill Aho) at 23.
8

7

Notwithstanding the provisions of section 106, the following are not
infringements of copyright: …
(11) …the making imperceptible, by or at the direction of a member
of a private household, of limited portions of audio or video content of a
motion picture, during a performance in or transmitted to that household for
private home viewing, from an authorized copy of the motion picture, or
the creation or provision of a computer program or other technology that
enables such making imperceptible and that is designed and marketed to be
used, at the direction of a member of a private household, for such making
imperceptible, if no fixed copy of the altered version of the motion picture is
created by such computer program or other technology. …
Nothing in paragraph (11) shall be construed to imply further rights
under section 106 of this title, or to have any effect on defenses or
limitations on rights granted under any other section of this title or under any
other paragraph of this section.9
Because the FMA clearly approved ClearPlay’s process, shortly after
passage of the FMA, the motion picture parties in the Huntsman litigation asked
the court to dismiss their claims against ClearPlay, which the court did based on
the FMA. Huntsman, 2005 WL 1993421 at 1 (“The technology provided by
Family Shield and ClearPlay is consistent with the statutory definition.”).
VidAngel incorrectly claims the FMA grants it the right to make
unauthorized copies and public performances, and to circumvent an effective
access control technology. The FMA did none of these things. First, the FMA
clearly limited the approved filtered performance to one viewed “from an
authorized copy of the motion picture.” Even assuming arguendo the VidAngel
9

17 U.S.C. §110 (emphasis supplied).
8

server copies (made by VidAngel and not the “owner” of the disc) were noninfringing, the copyright holders never “authorized” those copies, so transmission
from the same copy to multiple customers is clearly not covered by the FMA.10
Second, the final proviso of the FMA clearly states that no further rights under the
Copyright Act are granted by Section 110(11), the section added by the FMA.
Senate legislative history is no more helpful to VidAngel. The bill’s sponsor
specifically stated that the FMA did not preempt the anti-circumvention provisions
of the Copyright Act. As the District Court noted in the decision: “Senator Orrin
Hatch, who introduced the FMA, … stated that the FMA ‘does not provide any
exemption from the anticircumvention provisions of section 1201 of title 17.’”11
Accordingly, the District Court’s conclusion is irrefutable: “Neither the plain
language nor the legislative history of the FMA support VidAngel’s position.”12
In its Brief, VidAngel asserts that an exchange between Mr. Aho, the
ClearPlay CEO, and one Subcommittee member, stemming from a theoretical
Notably, in the then pending motion picture parties litigation, the court ultimately
granted summary judgment against the editing companies that made unauthorized
copies. Clean Flicks of Colorado, LLC v. Soderbergh, 433 F.Supp.2d 1236
(D.Colo. 2006) at 1238 (Soderbergh). Once a copyright holder has authorized
transmission (e.g., from a licensed online service), then the FMA clarifies the right
to filter that transmission.
10

Disney at 8. The District Court order also quotes Senator Hatch saying: “It would
not be a defense to a claim of violation of section 1201 that the circumvention is
for the purpose of engaging in the conduct covered by this new exemption in
section 110(11).”
11

12

Id.
9

technical question from that member, indicated approval of circumvention. The
exchange indicated nothing of the sort:
Ms. Lofgren. So you don’t have to defeat the encryption that is
protecting these DVDs, for example, although I guess theoretically the
movie industry could go to the next phase of encryption, which would then
require you to defeat that scheme.
Mr. Aho. We have not ever nor ever contemplated any decryption
measures. That’s not part of our business practice.
…
Ms. Lofgren. … But I really think there’s a broader issue here, which
is artists are free to create and express, but consumers who lawfully
purchase or rent are not required to look at all of it.13
This exchange, involving a theoretical construct about whether decryption
sometime might have to be examined, has no significance for the current situation,
because circumvention (decryption) is not necessary for filtering. Indeed, while
changes can and have been made to the content protection systems, even the “next
stage of encryption,” for Ultra-High Definition Blu-ray format, does not require
circumvention to use time codes for filtering,14 nor are we aware of any technical
protection measure that prevents access to the time codes. And given the
mechanical function of time codes, it is highly unlikely they could be encrypted
and the movie would still play. Finally, even if it were relevant to the current

13

Id. at 73.

See AACS2 for Ultra HD Blu-rayTM is now available for Licensing,
http://www.aacsla.com/license/ last accessed February 9, 2017.
14

10

situation, which it is not, a theoretical question by one member does not make
legislative history, particularly when nothing in the FMA supports any exemption
from the circumvention provisions of the DMCA.
In short, the FMA, in ratifying ClearPlay’s filtering technology, did not
approve the quite different content distribution methods of VidAngel and other
companies, which involved either the making of unauthorized copies, or the
circumvention of access controls, or (as with VidAngel) both.
C.

Allowing VidAngel to Circumvent and to Make Unlawfully
Copies and Public Performances Videos Disadvantages Lawfully
Operating Competitors Like ClearPlay

ClearPlay has distributed filtering products beginning in 2000, always
playing by the rules. Its services give parents video filtering, without any
circumvention of access control technology, and without making any unauthorized
copies or public performances of copyrighted content. Essentially, ClearPlay’s
filtering tools act like automatic remote controls—muting language and skipping
over scenes. ClearPlay’s filtering tools work with authorized copies (DVD and
Blu-ray Discs or streaming video). Many thousands of users have used ClearPlay’s
filtering tools.
The idea of filtering movies came to ClearPlay’s founder, Matt Jarman, prior
to the year 2000. While working as a movie editor, he conceived of ways for
families to control the entertainment in their homes. Ultimately Matt and his
11

brother Lee started ClearPlay, as a company focused on the belief that “families
can enjoy the show together” in their own home.
ClearPlay founders saw filtering as a way to protect the interests of the
consumers, directors, and studios. They recognized the distinction between editing,
which requires making a fixed copy of a work (and hence creates infringement
issues), and filtering, which does not create a fixed copy. Because ClearPlay’s
technology focuses on filtering during performances, not creating new edited
versions of movies, it is flexible and works across different platforms. In this way,
it could be compared to the audio equalizer common on consumer playback
devices used to enhance the sound quality. Audio equalizers work to customize the
sound quality, at the direction of the user, to suit each user’s desires, without
making a copy.15 Like ClearPlay filtering, audio equalizers work on a wide range of
devices and media.
Because ClearPlay’s technology filters during performances, and does not
create new edited works, it avoided the copyright problems intrinsic in the editing
model. For example, one former competitor, Cleanflicks, would edit movies by
first circumventing access controls on a DVD disc (colloquially referred to as
“ripping”), copying the “ripped” movie onto a computer hard drive, editing the
movie, burning a copy of the movie onto a DVD writable disc, and then
15

See, Wikipedia, Equalization_(audio),
https://en.wikipedia.org/wiki/Equalization_(audio), last accessed February 8, 2017.
12

distributing the edited disc. This model has been found to violate copyright laws
and the restrictions of movie licenses.16 While the Cleanflicks model provided
simplicity for the end-user, it came at the expense of copyright infringement.
The Plaintiff movie studios have acknowledged that contractual restrictions
that prohibit the creation of a new edited fixed work do not translate into
restrictions against ClearPlay’s filtering: “Nothing in these provisions prohibit the
studios from entering into distribution agreements that allow secondary editing or
filtering. … The DGA [Directors Guild of America] Basic Agreement simply does
not speak to filtering, much less prohibit it.”17 Accordingly, copyright owners and
other key industry players do not have agreements that prevent households from
filtering content in their own homes, or prevent ClearPlay from providing filtering
services in accordance with the Family Movie Act.18
VidAngel attempts to disparage ClearPlay by claiming that ClearPlay’s
filters are not yet available on certain streaming technologies. (VidAngel Opening
Brief at 58.) But the initial—and likely not permanent—incompatibility of
ClearPlay with one particular mode of movie viewing through one particular
vendor does not refute the fact that ClearPlay provides a viable way for families to
16

Soderbergh at 1236.

Plaintiffs’ Motion to Dismiss VidAngel’s First Amended Counterclaims, District
Court Docket Number 103, at 8:22-27 (Oct. 14, 2016).
17

Transcript of Proceedings at 4-8, Case No. 2:16-CV-04109-AB (December 19,
2016).
18

13

watch filtered movies. For every movie that ClearPlay has developed filters,
families can readily use ClearPlay’s filtering technology. The ClearPlay
technology works with studio-produced DVDs and Blu-rays, it works with a
catalog of Google Play streaming movies, and it can work with other streaming
technologies as well. The cause of filtering is not helped by VidAngel’s unlawful
behavior, especially coupled with its incessant undermining statements towards
those that are lawfully and legally filtering content.
ClearPlay, in short, picked a technology—filtering—that served the need for
family-friendly viewing of movies, without circumventing access controls or
violating the section 106 rights of the copyright owner. This kind of innovation,
meeting a social need in a manner that is legal, is exactly what our free enterprise
system encourages.

14

CONCLUSION
As ClearPlay has demonstrated over 17 years, it is not necessary to
circumvent an access control measure, or make unauthorized copies or public
performances in order to provide families with effective filtering technology.
VidAngel’s misinterpretation of the FMA is simply unsupportable either by the
plain language or the legislative history, and acceptance of VidAngel’s infringing
technology would undercut those that have worked within the law to develop
compliant technologies.
For all these reasons ClearPlay urges the Court to reject VidAngel’s
arguments and affirm the District Court’s Preliminary Injunction.
Respectfully submitted,
THOMPSON COBURN LLP
By /s/ Mark Sableman
Mark Sableman
THOMPSON COBURN LLP
One US Bank Plaza
St. Louis, MO 63101
Tel. [phone]

James M. Burger
THOMPSON COBURN LLP
1909 K Street, NW
Washington, DC 20006
Tel. [phone]

Attorneys for Amicus Curiae ClearPlay, Inc.

15

CERTIFICATE OF COMPLIANCE WITH TYPE-VOLUME
LIMITATION, TYPEFACE REQUIREMENTS AND TYPE STYLE
REQUIREMENTS PURSUANT TO FED. R. APP. P. 32(A)(7)(C)
Pursuant to Fed. R. App. P. 32(a)(7)(C), I certify as follows:
1.

This Brief of Amici Curiae ClearPlay Supporting Plaintiffs/Appellees

complies with the type-volume limitation, because this brief contains 3,065 words,
excluding the parts of the brief exempted by Fed. R. App. P. 32(a)(7)(B)(iii); and
2.

This brief complies with the typeface requirements of Fed. R. App. P.

32(a)(5) and the type style requirements of Fed. R. App. P. 32(a)(6) because this
brief has been prepared in a proportionally spaced typeface using Microsoft Word
2011, the word processing system used to prepare the brief, in 14 point font in
Times New Roman font.
Dated: February 15, 2017

By: /s/ Mark Sableman
Mark Sableman
Counsel for Amicus Curiae ClearPlay,
Inc.

16

CERTIFICATE OF SERVICE
I hereby certify that I electronically filed the foregoing with the Clerk of the
Court for the United States Court of Appeals for the Ninth Circuit by using the
appellate CM/ECF system on February 15, 2017.
I certify that all participants in the case are registered CM/ECF users and
that service will be accomplished by the appellate CM/ECF system.
Dated: February 15, 2017
By: /s/ Mark Sableman
Mark Sableman
Counsel for Amicus Curiae ClearPlay, Inc.

17