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The Courts Government Software News Entertainment

Lawsuits Force 321 Studios Out Of Business 465

elegie writes "321 Studios has gone out of business. Earlier, they came under fire for producing DVD disc-copying software. Specifically, it was argued by movie studios that the DVD-X Copy software and the DVD Copy Plus software violated the DMCA (Digital Millennium Copyright Act) anticircumvention rules. 321 Studios argued that copying a DVD disc for personal use counted as "fair use" in terms of copyright law. The EFF has said that the closing was not surprising because of all the legal injunctions against 321 Studios."
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Lawsuits Force 321 Studios Out Of Business

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  • Open source? (Score:5, Interesting)

    by Anonymous Coward on Wednesday August 04, 2004 @12:00PM (#9879680)
    How about opening the source for their software?
  • no surprise (Score:5, Interesting)

    by rhpot1991 ( 799210 ) on Wednesday August 04, 2004 @12:02PM (#9879694) Homepage
    Noone should be using DVD-X copy anyways, dvdshrink is where it is at. Better quality and better price(free).
  • by Marx_Mrvelous ( 532372 ) on Wednesday August 04, 2004 @12:02PM (#9879701) Homepage
    Any chance they're going to release the code to their products? Would that increase their legal liability at this point?
  • From their FAQ (Score:5, Interesting)

    by Gentoo Fan ( 643403 ) on Wednesday August 04, 2004 @12:04PM (#9879725) Homepage
    It is not illegal for you to own or use the software. The injunction only applies to 321 Studios. [321studios.com]

    How long until 321 will be required to hand over their customer list (at least the ones that registered)? If they can force this company out of business, it seems to me the next step is to go after the users. You know, the ones doing the acutal "law breaking".
  • Dangerous precedant (Score:5, Interesting)

    by Jonny_eh ( 765306 ) on Wednesday August 04, 2004 @12:05PM (#9879737)
    I may be just stating the obvious but: This is awful because now the MPAA and RIAA are gonna sue as many of their perceived enemies as possible, hoping to shut them down too. On the bright side, maybe people will use the superior DVD Shrink [dvdshrink.org] instead.
  • by Mitleid ( 734193 ) on Wednesday August 04, 2004 @12:05PM (#9879740)
    It shows a lack of journalistic integrity to completely believe a company for their reasons for going out of business. It could very well be true that the lawsuits seriously put a damper on their plans, but it could ALSO be true that the company was just poorly managed. No one is going to come out and say: "We're going out of business because our managers are a bunch of schmucks and blew all the money on cheap whores and expensive cocaine!"; they're gonna point the finger.
  • Serves'em Right (Score:1, Interesting)

    by Lead Butthead ( 321013 ) on Wednesday August 04, 2004 @12:06PM (#9879756) Journal
    321 were avid e-mail and phone spammer that tried to further their wallets through unsolicited bulk e-mail. I personally shed no tear for a company that STEALS from me each time they send me their spam.
  • by linzeal ( 197905 ) on Wednesday August 04, 2004 @12:06PM (#9879760) Journal
    For windows the best thing for DVD ripping since sliced bread is Gordian Knot [sourceforge.net] and if you still want to get the most retarded version out there try this [amazon.com]. Remember 321 studios made a simplified front end for DVD copying built on some shoddy code, they might have become better in a few generations but the free stuff still works better.
  • by anandpur ( 303114 ) on Wednesday August 04, 2004 @12:09PM (#9879805)
    "Under the DMCA, you have a theoretical right to fair use. But this ruling shows that if you provide a tool for fair use you can't use it."

    From NewScientist [newscientist.com]
  • Backups not legal? (Score:5, Interesting)

    by SiliconEntity ( 448450 ) on Wednesday August 04, 2004 @12:10PM (#9879809)
    As I understand it, there is no legal right to make backups of movies, in the U.S. There is a right to make backups of computer software, but that provision is explicit and does not apply to other forms of content.

    Some have argued that fair use would allow making backups of general content, but since such usage is not educational or for research purposes, and would have commercial impact, it seems like a weak argument to me. In any case, it has never been confirmed in the courts.
  • by chrisw24 ( 798887 ) on Wednesday August 04, 2004 @12:12PM (#9879839)
    I heard from a friend that knows someone that knows someone else, that they are moving the business offshore. Not sure if the business will move out of the US, or if the employees will be recieving a paycheck from a company overseas, I guess we'll have to wait and see.
  • As usual (Score:4, Interesting)

    by blackmonday ( 607916 ) on Wednesday August 04, 2004 @12:12PM (#9879841) Homepage
    A combination of free and cheap software works much better than 321 Studios' software. DVD Shrink is free, easy to use, and never crashes. Nero can be had as cheap as $5 on the web. This combination is sweet, if you're using DVD-X-Copy or whatever you paid for inferior software.

  • Re:From their FAQ (Score:2, Interesting)

    by SpiritOfGrandeur ( 686449 ) on Wednesday August 04, 2004 @12:12PM (#9879847)
    How long until 321 will be required to hand over their customer list (at least the ones that registered)? If they can force this company out of business, it seems to me the next step is to go after the users. You know, the ones doing the acutal "law breaking".

    If you use peerguardian and 321 Software you will notice that the program does not work because it blocks reporting to the 321 sites. This means that not only do they have a legal list of registered users that have bought it, but they also have a list of IP's of all the people who have burned a movie. While I have not checked what these packets contain, I can only assume they have a whole list of any thing that any one has ever copied...
  • Other solutions (Score:5, Interesting)

    by Zaranne ( 733967 ) <zaranne17NO@SPAMgmail.com> on Wednesday August 04, 2004 @12:20PM (#9879936) Homepage Journal
    I don't understand why the solution that worked for the music world wasn't used here. Back when blank recording cassettes were created and mass marketed, the music industry nearly blew a gasket. The compromise is that TDK/Maxell/Fuji and the rest pay a small portion of their sales to the record companies. Kind of a tithe. While it's still illegal for me to copy my CD's onto cassettes and SELL them to people, I can do it for personal use. Everybody's happy.
  • by jrockway ( 229604 ) * <jon-nospam@jrock.us> on Wednesday August 04, 2004 @12:23PM (#9879977) Homepage Journal
    The source code doesn't rip any DVDs. It's just a text file with neat words like "void" and "int32" in it. LAME uses the same principle: Lame Ain't an MP3 Encoder. It's the source code for one. If you'd like to violate the patent yourself, go ahead and compile it. If you want to violate the DMCA go ahead and compile the ripper. Otherwise it's speech just like this post or that song you got off of Kazaa^H^H^H^H^H iTMS :-D

    If someone tells you otherwise it's time to a) write your Congresscritter a nice note or b) burn down a building or two. You didn't hear b) from me though :-)
  • Re:no surprise (Score:3, Interesting)

    by erroneus ( 253617 ) on Wednesday August 04, 2004 @12:23PM (#9879982) Homepage
    Thanks for plugging DVD Shrink! No seriously. I have never heard of it before you mentioned it here. I can't tell you how many interesting things I have picked up in slightly off-topic skews. Very useful tip.

    I still think they should open-source the software. :) I think it would send an important message to the **AAs out there.

    "If you strike me down, I shall become more powerful than you can possible know..."

    At least then they'd have more incentive to find other ways to close down an operation they dislike such as with money or negotiations rather than lawyers and the courts.
  • by Unnngh! ( 731758 ) on Wednesday August 04, 2004 @12:30PM (#9880061)
    These are all small steps in a longer process of trying to control something that is very difficult to control: The internet. The RIAA has now set a precedent of successful subpoenas on user records of people appearing to violate copyright law. Other regulations like the DMCA don't apply so directly, but in an indirect fashion result in free speech on the net being truncated. Currently there's a lot of stuff going on legally around these issues and it's all very confusing. As is intended.

    The PATRIOT act put into law many things for which the legal system had already set precedent in one form or another; there was just no codification of these items into law until a moment of panic ensued and *whoosh* along come laws that certain members of law enforcement have been trying to get through for years. Along comes a limitation on freedom in exchange for the perception of heightened safety.

    I see internet-related regulation going in much the same fasion. The obvious answer with this one, however, lies with all of us: don't do illegal shit and no one will have to pass these laws. Stop using P2P to share copyrighted works. We have already gotten ourselves in enough trouble with the DMCA, don't let it go any further.

  • by Seoulstriker ( 748895 ) on Wednesday August 04, 2004 @12:34PM (#9880094)
    If you go to the website for the Bastard company, http://www.123copydvd.com/ [123copydvd.com], you will notice that the "company" is offering the exact same program. What 321 Studios has effectively done is known as "asset protection", where they branch off a company into a separate Corporation or Limited-liability corporation (LLC) that is untouchable if the prior company is sued and run out of business. 321 studios is still alive, just in another form. I have purchased their 123 copy DVD software, and it is almost identical to the 321 Studios DVD X Copy software.

    If you wish to see how damn clever they are, they do not actually include de-cryption software in the product. They do however link directly to a "3rd Party Plugin" site which features a downloadable plug-in which works exclusively with 123 copy DVD.

    Talk about legal maneuvering!
  • by marc_moore ( 799688 ) on Wednesday August 04, 2004 @12:36PM (#9880113)
    Of course, that's supposed to be funny, and it is, but the question is: why buy DVDs from companies that simply want to screw you?

    I know, the Slashdotters of the world are like 0.001% of the movie buying market and business would go on as usual, but principles matter.

    They matter even more when the other side has none. Take the lawsuits that the idiots in the Directors Guild of America (DGA) have filed against Clean Flicks. Morons!

    Freedom of speech also means that if I want to see "Jay and Silent Bob Strike BacK" without hearing FUCK every thirty seconds then that is my right.

    Naturally I'm a doofus for wanting to watch that POS flick in the first place, but hey, it's America! :-;
  • Re:Grrr, but ok (Score:2, Interesting)

    by Alchemar ( 720449 ) on Wednesday August 04, 2004 @12:50PM (#9880266)
    The problem is not about people breaking the laws, it is about corporations making them. Yes, I think the RIAA should go after the people DISTRIBUTING, there copyrighted material. When they talk to the media it is people downloading or "stealing", but it is actually the people that have material available for other people to download. I don't think it is smart business move, and I go to www.riaaradar.com before I will buy anything because of it, but they are within their legal rights. What I have a problem with, is them pushing congress to make copyright violation a federal offense, extend copyrights to longer than a lifetime, or laws like the DMCA wich make it illegal to be capable of breaking the law. Lets just break everyones legs so that no one will be allowed to Jay walk. Show me a precise reason where it is different. Most people will agree that breaking everyones legs is just somehow wrong. Taking away the right to use my computer for legitimate purposes is also just plain wrong. America was designed to be a capitolistic society. If they need a monopoly to make money, they do not need to control our goverment. I am not sure about the exact figures, but actually stealing a CD from a store is a misdomeaner with around a $250 fine, maybe a few months on probation. "Download" the CD and it becomes a $15,000 per song violation with an average of 13 songs per CD. The law is obviosly biased towards to corporation. /rant
  • GPL?? (Score:3, Interesting)

    by acousticiris ( 656375 ) * on Wednesday August 04, 2004 @12:53PM (#9880304)
    I'm thinking if I'm them... My company's last dying breath is to release the source code to the public domain or as a GPL application.

    Sure, one can easily argue that there are other apps that do (IMHO) a better job and are free (like DVD Shrink), but being as high-profile as their company has been the last few months, being that they sell their products in retail stores, a move like that might garner some pretty serious publicity and would surely ruffle the feathers of their adversary.
    Even though the cat has been out of the bag for a while regarding CSS, them sending out copies of sourcecode would surely have social/emotional impact.
    My guess is that someone there would probably be sent to jail for further violating the DMCA (not only making an anti-circumvention tool that people can use to backup and *gasp* copy DVDs, but giving a bunch of "no good hackers and pirates" the ability to modify the software for other nefarious purposes (oh no!)). But I'm sure there's a way they could get around the law to do it.
  • Re:I can't stand it (Score:5, Interesting)

    by maximilln ( 654768 ) on Wednesday August 04, 2004 @01:17PM (#9880550) Homepage Journal
    You buy something based on the terms of the seller. You agree to the terms when you buy it.

    Stalking is illegal. The seller has no right to monitor your use after you leave their shop. The grocery store does not have terms of use on knives. The drugstore does not have terms of use on aspirin. The hardware store does not have terms of use on power-nailers. The sporting goods store does not have terms of use on baseball bats.

    A sale with "terms of use" is a rental, not a sale. Auto agencies of "terms of use" on car rentals. Contractor stores have "terms of use" on equipment. Landlords have "terms of use" for property. It may be a rental with an unspecified time limit, but it is still a rental. Violation of a rental agreement is a civil matter which requires the renter to retain legal counsel and compile a case.

    What is the difference between "licensing" and "renting", other than a legal manipulation by which the renter has passed the financial burden of legal counsel and making the case onto the taxpaying public?
  • by BrianWCarver ( 569070 ) on Wednesday August 04, 2004 @01:31PM (#9880677) Homepage
    This shows the DMCA can be used by the MPAA/RIAA to put legitimate technology companies out of business. But they're hoping for another tool to do even more of this, and it's called the INDUCE act.

    Go to EFF's Action Center [eff.org] and savetheipod.com [savetheipod.com] to take action! Let your Senators know that they should be supporting Rep. Boucher's DMCRA [house.gov] rather than INDUCE.

    We can turn the tide here if we take action!
  • by abb3w ( 696381 ) on Wednesday August 04, 2004 @01:41PM (#9880803) Journal
    What 321 Studios has effectively done is known as "asset protection", where they branch off a company into a separate Corporation or Limited-liability corporation (LLC) that is untouchable if the prior company is sued and run out of business.
    IAmNotALawyer, but I believe there are some circumstances such protection can be breached. Of course, since it doesn't look like 321 studios had major liabilites when they were shut down (since the MPAA mainly sought the injunction, not damages), they may be able to get away with it.
    If you wish to see how damn clever they are, they do not actually include de-cryption software in the product. They do however link directly to a "3rd Party Plugin" site which features a downloadable plug-in which works exclusively with 123 copy DVD.
    Not so damn clever; more like damn careless. As was mentioned a while back on The Register [theregister.co.uk], this "3rd party" site lists in its whois records that it is administered by a person of the same name as the whois administrative contact for the 123copydvd.com records. "Gee, whaddacoiinkidink, Boss!" IAmNotAJudge, but if I was, I'd probably consider that prima facia evidence to support a major fishing expidition during discovery.

    Of course, the point is moot in the long run, if DVD Shrink works the way I've heard it does. The MPAA is showing massive shortsightedness here. 321 at least made some efforts to put some warnings in, added a screen indicating that what was there was a copy, and would not support copy-of-a-copy making. I've been told DVDShrink has none of these limits.(Anyone using it care to correct me?) So, after you sue the people making money off trying to be legal out of business, how do you deal with the people who are giving the stuff a way and don't care whether it's legal or not?

  • Re:Open source? (Score:5, Interesting)

    by the_mad_poster ( 640772 ) <shattoc@adelphia.com> on Wednesday August 04, 2004 @01:51PM (#9880931) Homepage Journal

    Since when is the general public, which houses the majority of public opinion, capable of critically evaluating anything more complicated than a diluted press release?

    There is a reason that news is written on such a sophomoric level and the major "news stations" attempt to cram all of their "information" into short, sixty second blurbs between their bickering guests and stunningly imbecilic hosts. People these days have no critical thinking skills at all. They have to be told what to do in the simplest possible terms. If they actually had to make their own daily decisions on any level above that which should be expected of a three year old, most of them would probably die.

    Given all of this, how do you figure that the public will be smart enough to say "wait, these open shorts people are just protecting my rights to do with my DVDs as I please! This MBA A group is just an evil congolomerate attempting to stifle my use of my own personal property!" The MPAA will simply come out and brand anyone distributing the tools as dirty, filthy pirates, blame them for rate hikes, and continue rolling in the dough while the mentally retarded herd that is most of the developed world goes about its job of being obliviously fleeced by every major corporation and government on the planet.

    That doesn't even take into consideration that these idiots have probably never even heard of 'open source', the 'MPAA', 'CSS', or, most important, their own fair use rights in anything more than the most superficial manner.

  • by sk3tch ( 165010 ) on Wednesday August 04, 2004 @01:59PM (#9881037) Homepage
    Can you prove that DVDXCopy is simply a front-end wrapper for a bunch of open source tools? This has been a "myth" and something people have claimed for quite some time but I've never seen anyone back it up!
  • by eadint ( 156250 ) on Wednesday August 04, 2004 @02:14PM (#9881189) Homepage Journal
    I will probably get modded into oblivion for this but i think it has to be done
    The recent events of orin hatch [slashdot.org], DMCA shinanigans [slashdot.org] have just gone too far. there are allot of people on /. who like to whine about this kind of thing but nothing ever gets done. i think its time that /. show its power in the DMCA and DRM, and *AA [slashdot.org] playing field. the web site www.nomoreorin. org com net are currently available. based on user moderation here is what i plan to do.

    1. Register the domain www.nomoreorin.org and use it for a organizational starting place to campaign against his reelection
    2. Gather all of the evidence and bills that he is against peoples rights and is in the pay of the *aa
    3. Work to form a grass roots party in his hometown to make sure that he is defeated buy a landslide in the next election.
    4. Try to set up rallys and protests in his community with pamphlets that say

    1. Your senator wants to outlaw your VCR, Tivo, DVR

    2. Your senator wants to outlaw your computer
    3. Your senator wants to put viruses and destroy your computer if you do something he doe sent approve of
    4. Your senator helped to put an innocent Russian Civilian in jail without due process over writing an essentially legal program.

    5. Your senator wants to remove your rights to make backup copies of movies and software that you already own

    6. Your senator cares more about the *aa than the people who elected him
    7. Your senator has accepted XXXXX$ from these *aa groups

    5. Next target any and all politicians that have shown support for the DMCA, INDUCE or have received an money from the *AA
    6. If we send a message to the government that clearly states that

    1. If you accept any money from the *AA we will see to it that your political career is destroyed.
    2. Supporting any bill that restricts a users rights to media he owns will result in your not getting elected.

    It is evidently clear that if we do not act now. your right to use a computer or any kind of audio and visual media will be severely restricted.
    Depending on the replies to this post i will reserve and set up the
    www.nomoreorin.org website.
    and will do what i can to help a movement whose time have come .
    if you have any questions email me at
    eric.aint.net (spam proof)

  • Re:Open source? (Score:2, Interesting)

    by nakedbonzai ( 618338 ) on Wednesday August 04, 2004 @02:23PM (#9881273)
    I'm not disappointed at all about this news. DVDShrink is a better alternative to dvdxcopy. Dvdxcopy bothered me because it would add a 5 second splash in front of every dvd you burn. Dvdshrink does not.
  • Re:From their FAQ (Score:2, Interesting)

    by SpecBear ( 769433 ) on Wednesday August 04, 2004 @02:29PM (#9881345)
    321 Studios is now out of business. What happens if people just start copying DVD-X Copy software willy-nilly?

    Can a copyright violation be pursued by anyone besides the copyright holder? Since 321 Studios can no longer profit from the software, they have no incentive to go after pirates, and likely couldn't afford to even if they wanted to. My (possibly flawed) understanding is that, while it would be illegal for me to use a copy of the software copied from a friend, only 321 Studios would be able to take action against meif I were to do so.

    Others here have mentioned they could be charged with contempt of court if they released the software as open source, but what if they just don't go after pirates?
  • Re:Open source? (Score:2, Interesting)

    by shufler ( 262955 ) on Wednesday August 04, 2004 @02:51PM (#9881544) Homepage
    www.doom9.net [doom9.net]
  • Re:Open source? (Score:1, Interesting)

    by Anonymous Coward on Wednesday August 04, 2004 @05:06PM (#9882746)
    Is DVDshrink really better?

    I remember reading that 123's stuff did not have to re-encode, it worked by removing a specific type of packet or frame from the mpeg-stream so that it was both very fast and had as little possible quality loss because there was no render-reencode step.

    Last time I looked at dvdshrink, it sure looked like it did do the render-reencode route.
  • Re:no surprise (Score:3, Interesting)

    by OgGreeb ( 35588 ) <og@digimark.net> on Wednesday August 04, 2004 @05:49PM (#9883346) Homepage
    I bought a copy, and bought another copy just before they discontinued it. I wanted to make the point that we should be able to buy this software, and you can only prove the point by putting up the bucks.

    I'm only sorry that Robert Moore had to spend all his money on fighting this fight for us, instead of tricking out a Hummer.
  • by drinkypoo ( 153816 ) <drink@hyperlogos.org> on Wednesday August 04, 2004 @05:55PM (#9883411) Homepage Journal

    Ditch the RAID card. Add some ordinary SATA controllers to your PC. Do software raid on linux, using an XFS, JFS, or ReiserFS filesystem. Get a motherboard with GigE onboard. This should keep your cost down dramatically, I think you could do the whole thing under $1500. 256MB would be plenty of memory but 512MB would allow for more caching.

    A RAID controller is mandatory if your CPU is doing anything else on the system, but if all it's doing is providing NAS, then doing software RAID is the best way to go as it is a lot cheaper and dedicating a ~2GHz 32 bit processor to the job is going to be faster than the RAID controller anyway.

  • Re:Lesson. (Score:3, Interesting)

    by Genda ( 560240 ) <marietNO@SPAMgot.net> on Wednesday August 04, 2004 @07:39PM (#9884447) Journal
    I deply believe that if you have a variety of engineers, scientists, and sociologist examine our culture and specifically the workings of law and the legal system, you will find that the best description of the legal system is; ECOLOGY.

    The body of law forms a substrate of complex and chaotic interactions that is perfectly consistent with a living ecology. As forces inpinge from the outside, populations and affiliations move, break, reform, and new structures are forever unfolding from this churning stew of law.

    It might well behoove us, as a society, to bring experts on complex systems and organic structures, to help us grow a legal environment that is at once, healthy, sustainable, and insure those cultural caveates we hold most dear (i.e. personal freedom, personal responsibility, and civil equality.)

    By engineering the ecology of law, we have a much better chance of protecting the system against whose forces we know ultimately cause ecological failure. It is time for our society to address a number of important issues that have been left to the ravages of entropy and gravity. If we don't become responsible for engineering ourselves and the societies in which we live, we cannot be surprised by the growing frequency of bad law, failed governments, wars, and all manner of human catastrophes. The amplification of technology, the increase of human population and global impact, demand that we look at the human condition with new eyes. These problems we now face are merely symptoms, and the symptoms will only become more pronounced, more severe if we ignore their root causes.

    Genda

    "In the end, they put you in the ground, throw dirt in your face, and go eat pizza... it's only while you breath that you have any power to make a difference... so what the heck are you waiting for?"

If you think the system is working, ask someone who's waiting for a prompt.

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