Family-friendly video service under fire

Families who enjoy the latest home-video releases but would rather watch them the way they might look and sound if they were edited for family-hour TV have that option, thanks to technology.

Utah-based VidAngel has about 3,000 show titles viewers can stream on most any device. About half a million people have tried it out.

But in June, four movie studios sued VidAngel in federal court for copyright infringement. Disney, Warner Bros., Twentieth Century Fox, and Lucasfilms say VidAngel has no consent to stream their content and it needs a license to do so.

For its part, VidAngel says that’s a problem the studios created by not offering filtering themselves. It cites the Family Movie Act of 2005 as its authority to filter movies for customers.

Neal Harmon founded VidAngel in 2013 with three of his brothers. Each of them has young children, and they longed for a way to watch movies together but skip the bad language and other cringe-worthy moments.

“Our philosophy as a company is that directors should have the freedom to be able to present their work in the public sphere however they want. And then individuals in the privacy of their own home should be able to watch however they want,” Harmon said.

VidAngel customers start by paying $20 to purchase a movie of their choice. They can set filters and stream it on any device. Viewers have 24 hours to return the movie and get $19 back, or they can keep it.

The movie studios suing VidAngel say the company has built its business on rights it doesn’t possess or pay for. The warnings about copyright pop up on every home DVD: You can watch the movie in your own home, but you can’t charge others to come in and watch it. A lawyer for the studios said VidAngel does not have permission to stream the movies it sells.

VidAngel says it buys a new movie disk for each unique customer; its warehouse stores thousands of them. The studios get paid upfront for the DVDs. So if VidAngel purchased 25 discs of Batman Returns, and 26 people want to watch it tonight, the 26th person would have to wait until someone sold the movie back to VidAngel.

VidAngel says it is following both copyright law and the Family Movie Act. But attorney Kelley Claus, who represents the studios, said VidAngel still doesn’t have rights to stream the video over services such as Roku or AppleTV.

“Even the DVD that they have metaphorically listed as having been sold to you, … they’re not streaming from that DVD. They’re streaming from some other copy that they’ve made from one of the DVDs,” Claus said.

David Quinto represents VidAngel and was a lawyer for the Academy of Motion Pictures for 30 years. He said VidAngel tried to get streaming permission from the studios but never received a response to its letters. A year later, the studios filed the lawsuit.

“If studios have a complaint that VidAngel doesn’t have a streaming license, there is a very simple way to resolve their concern. They could sell us one,” Quinto said. He added that Congress specifically authorized movie filtering with the Family Movie Act, so VidAngel is “a service that Congress most definitely wants made available to the public.”

VidAngel has filed a counterclaim against the movie studios saying they engaged in antitrust violations to unfairly keep out new industry even as the studios themselves won’t offer filtering technology.

Claus flatly denied that claim and pointed to what he called a legitimate filtering company. ClearPlay sells a filtering machine that plays DVDs at home. Its technique avoids the problem of temporary ownership and streaming that VidAngel faces.

But Harmon sees this as a much bigger battle.

“This case is about answering the question: Does the family or Hollywood have the authority on filtering within the home?” he said. “Because at VidAngel, we stand with the family.”

The case may decide how technology companies can distribute content online, something almost everyone uses every single day. A federal judge in California will rule at the end of next month on the injunction against VidAngel.

Listen to “Legal Docket” on the Sept. 26, 2016, episode of The World and Everything in It.