Motion Picture Industry Takes Action To Stop Chip Manufacturers From Helping To Facilitate Piracy

5-Dec-05

The Motion Picture Association of America, Inc. (MPAA) announced that the major film studios have filed breach of contract lawsuits against two Taiwanese DVD chip manufacturers, Cheertek, Inc. and Sunplus Technology Company, Ltd., for violating the Content Scramble System (CSS) license agreement that protects DVDs against illegal reproduction and redistribution. The lawsuits follow four similar actions that all resulted in the entry of injunctions against other major chip manufacturers. Such initiatives are critical to the studios as breach of the CSS license facilitates piracy around the world.""The CSS license protects valuable copyrights and companies that sign it must abide by its terms."" stated Dan Robbins, Chief Technology Counsel for the MPAA. ""The courts in each of the four prior lawsuits all issued injunctions banning future violations of the license and we intend to seek out and move promptly against any further violations.""Over the last year, the MPAA's member companies have stepped up their efforts to crack down on the illegal distribution of CSS chips that are used to unlock the security features on copyrighted motion pictures on DVDs. The CSS license restricts integrated circuit suppliers from selling CSS chips to DVD player and computer manufacturers that do not have a valid CSS license because such entities have no contractual obligations to implement appropriate security features. Both Cheertek and Sunplus have signed the CSS license and agreed to these restrictions. An investigation by the Content Protection Compliance Testing Lab at the MPAA uncovered that the companies had sold chips to a number of non-licensed companies who used the chips in DVD players that lacked appropriate security features.The CSS license has provided the baseline protection that has enabled the studios to provide consumers with over 40,000 DVD titles. The motion picture studios are third-party beneficiaries of the CSS license and may enforce it against licensees who fail to honor its terms.A federal interagency report published in 2004 estimated that counterfeit and pirated goods, including those of copyrighted works, cost the American economy $250 billion a year. The MPAA estimates its member companies lost $3.5 billion last year due to piracy of hard goods alone, not including losses on the Internet. Working with law enforcement around the world, the MPAA seized more than 76 million illegal optical discs in 2004.

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