COMMENT: DVD COPY PROTECTION RULES VIOLATE THE SHERMAN ACT

11 Wake Forest J. Bus. & Intell. Prop. L. 103

The majority of DVDs sold in the United States are protected by the Content Scramble System (“CSS”). Any firm wishing to use it, either to encrypt their content or to decrypt encrypted content, must first obtain a license from the DVD Copy Control Association (“DVD-CCA”). Because of CSS’s prevalence, the DVD-CCA has an extraordinary amount of market power.

Copyright based challenges to the DVD-CCA’s practices have been largely unsuccessful despite CSS’s well known ineffectiveness at stopping individuals with little technical sophistication from ripping CSS-encrypted DVDs. Indeed, programs that can circumvent CSS, like DeCSS, are widely available on the internet. With its impotence shrouded in the color of law, CSS remains the prevailing form of encryption of DVD content.

These practices should be challenged under the Sherman Act, the cornerstone of federal antitrust law. Such challenges, like the recent one made in RealNetworks, Inc. v. DVD Copy Control Association, have been unsuccessful. Given the prevalence of DVDs, it is surprising that the association’s CSS license agreement has escaped a full-scale rule of reason review. This is especially concerning in light of the agreement’s effect on the market for devices like video servers, digital video recorders, and backup programs like RealDVD. This comment concludes that DVD-CCA’s implementation of CSS, the prevailing method of DVD copy protection in the United States, is an anticompetitive restraint of trade in violation of section 1 of the Sherman Act.