PROVO — A California jury awarded Disney and other Hollywood movie studio plaintiffs $62.4 million on Monday following a trial to assess damages against video filtering service VidAngel.
The ruling comes after years of legal wrangling in which Disney, Warner Brothers and 20th Century Fox argued VidAngel infringed on their copyrighted content by ripping copies of movie discs, copying them and streaming them to customers for $1 per movie.
The plaintiffs argued that in some cases, VidAngel was streaming content before it became available on licensed streaming services like Netflix, Amazon Prime and others.
VidAngel offers a service that filters out content of movies and television shows that may be objectionable to some viewers like nudity, profanity and violence. It's unclear if the 5-year-old company, which is currently in the midst of a bankruptcy proceeding, can survive the financial burden.
VidAngel CEO Neal Harmon voiced his dissent with the outcome Monday and vowed to appeal the ruling.
“We disagree with today’s ruling and have not lessened our resolve to save filtering for families one iota," Harmon said in a statement. "VidAngel plans to appeal the District Court ruling, and explore options in the bankruptcy court. Our court system has checks and balances, and we are pursuing options on that front as well.”
The damages assessment follows a summary judgement issued in March by U.S. District Court Judge André Birotte Jr. in favor of the major production companies.
In his ruling, Birotte wrote that VidAngel is liable for copyright infringement and had violated the plaintiffs' public performance rights. The judge dismissed VidAngel's arguments that its filtering service was protected by the 2005 Family Movie Act, and found that the company failed to make a viable argument based on fair use law.
"Upon review of the record, the court finds that there are no triable issues of material fact because VidAngel either admitted all of the material facts, or its purported factual disputes are not genuine," Birotte wrote. "In addition, VidAngel cannot avoid the questions of law that this court and the 9th Circuit resolved against it. Thus, plaintiffs are entitled to summary adjudication that VidAngel is liable for copyright infringement and for violating the (Digital Millennium Copyright Act)."
A spokesman for the plaintiffs' group said the ruling and assessed damages represents a warning to others that the unlawful use of protected content will be punished.
“The jury today found that VidAngel acted willfully, and imposed a damages award that sends a clear message to others who would attempt to profit from unlawful infringing conduct at the expense of the creative community.”
Disney and fellow plaintiffs at one point said they were entitled to double damage assessments since VidAngel was found to have infringed on copyright protections twice — first by "ripping" or bypassing security protections of commercially produced DVD/Blu-ray videos, and then again when it made copies for streaming the content to VidAngel customers. At trial, the plaintiffs were seeking about $125 million in damages, based on the argument that Vidangel had committed willful infringement and therefore should be assessed the maximum level of damages.
Courts assess copyright infringement at one of three stipulated levels of innocent, ordinary or willful, with per-title damages that range from $200 at the lowest level to $150,000 at the top of the willful infringement assessment.
Vidangel's legal team argued that it had only committed innocent infringement and was only liable for about $600,000 in damages, total.
The jury found that VidAngel's infringement was willful and determined the studios were entitled to damages of $75,000 for each of the 819 works in question, plus another $1,250 per title for violation of the Digital Millennium Copyright Act.
VidAngel did not immediately respond to Deseret News requests for comment about how the ruling would impact the company's bankruptcy proceeding or if the company would remain viable in light of the size of the jury award.
Shortly after the company entered Chapter 11 bankruptcy protection in October 2017, which included naming over 100,000 customers as creditors in the action, Harmon said the decision would allow VidAngel to position itself to deal with any legal outcomes of the infringement litigation.
Harmon said at the time that the pause afforded by the bankruptcy proceeding would allow VidAngel to accrue "enough revenue from our new system to pay any damages." That new system was a change from using movie discs as source material for the filtering service to filtering content sourced from licensed streaming services, which continues to be available.