Disney has lost a bid to stop US movie rental company Redbox from reselling download codes for its movies.
Redbox rents and sells movies via thousands of automated kiosks placed throughout the country that dispense DVD and Blu-ray discs. The company bought Disney movies on DVD to offer for rental in these kiosks, and the DVDs were frequently bundled with a code to download a digital copy of the film.
Disney requested an injunction to stop the practice, saying that Redbox had no business arrangement with it, but a California federal judge has accused Disney of “copyright misuse”.
Disney said this constituted copyright infringement because the language on the packaging made it clear that codes were not for sale or transfer.
However, Judge Pregerson said that the wording on the packaging did not create an enforceable contract. He also sided with Redbox’s argument that Disney was misusing its copyrights by trying to restrict the reselling of copies of its movies after they had already been sold.