Mozaex Legal Information

Mozaex agrees with the article that if the Court does not grant the petition, the Kaleidescape DVD Server could be prohibited from shipping as early as next month. Mozaex also believes that:

• THIS CASE HAS POSITIVELY REAFFIRMED THAT MOZAEX IS FULLY LEGAL
• THIS CASE DID NOT AND WILL NOT NEGATIVELY AFFECT MOZAEX

NEWS – April 2nd 2012: "Kaleidescape Granted Temporary Stay on DVD Servers”

"If Kaleidescape’s petition is not granted, the injunction could come into effect later in April or in May." Click here to read article.

Mozaex agrees with the article that if the Court does not grant the petition, the Kaleidescape DVD Server could be prohibited from shipping as early as next month.

• This case has positively affirmed that the Mozaex product is legal.
• Any future rulings in this case will not negatively affect Mozaex.

NEWS – April 2nd 2012 : "Judge issues injunction that prohibits the sale and support of existing DVD movie servers". Click here to read article.

Article Excerpt: "The DVD Copy Control Association (DVD CCA) has prevailed in a final decision against Kaleidescape, a manufacturer of high-end movie servers.

Judge Willliam J. Monahan has affirmed the temporary decision he issued earlier this year in the Superior Court of California, Santa Clara County. To that, he added a permanent injunction against the sale and support of Kaleidescape's current DVD servers.

The far-reaching injunction touches not just Kaleidescape, but its agents, franchisees and "those acting in concert with them or at their direction," all of which are “permanently restrained and enjoined from directly or indirectly making, having made, selling, offering to sell, marketing, importing or otherwise transferring any DVD Playback Product” that does not have a physical disk present during playback, the court ordered."

Click here to read article.

• Kaleidescape will REQUIRE an old-fashioned "DVD disc-changer" to play DVD movies..
• Kaleidescape will continue to REQUIRE an antiquated "Blu-ray disc-changer" to play loaded Blu-ray movies.
• Kaleidescape will NOT be able to STORE DVDs.
• Kaleidescape will ONLY be able to play PHYSICAL DVD discs.
• Kaleidescape will NOT be a TRUE MULTI_ROOM" DVD Server since it inherently won’t play any DVD, in any room, at any time.
• Kaleidescape will likely REQUIRE multiple sets of discs and disc changers to play any DVD at any time in multiple rooms.
• Kaleidescape will LOSE ADDITIONAL BENEFITS offered by the Mozaex “Hard Drive Server” system including:
  • LIMITATION of no inherent multi-room playback of DVDs.
  • INCONVENIENCE of loading discs into a physical disc-changer(s).
  • FRUSTRATRATION with managing multiple disc-changers in different locations.
  • ENCUMBRANCE with a disc-changer that is too large to fit in most rooms or cabins on yachts.
  • DISSATISFACTION with the excessively slow access and playback of DVD movie disc changer based discs.
  • UNRELIABLITY due to a mechanical disc changer that ALSO has to PLAY THE DVD.
  • LACK OF SUPPORT for multiple country region DVDs and Blu-rays.
  • COMPLEXITY, high power and heat with the likely need of multiple players, disc changers and storage components.
  • COSTLY requirements of multiple system components and/or centralized A/V switches for multi-room applications.

• Mozaex system design has been reaffirmed to be legal by both the RealDVD and Kaleidescape cases.
• Mozaex continues to ship its award winning Server without requiring a disc-changer.
• Mozaex offers a superior product that can play stored DVD’s and Blu-ray movies in multiple rooms.
• Mozaex offers many unique valuable features that Kaleidescape does not offer including:
  • Blu-ray HD 3D Movies
  • Instant Streaming VUDU, NetFlix Movies
  • High Quality Downloaded iTunes Movies
  • High Quality Home Videos and Photo Slide Shows
  • 200 Plus Channels of Online Media

The Kaleidescape lawsuit is specifically a contractual licensing dispute between the DVDCCA and Kaleidescape.

Mozaex is not negatively affected by this ruling since Mozaex does not have a contract with the DVDCCA or other decryption software company and thus is not subject to any possible contractual violation.

Mozaex does not ship with the DVDCCA related software or any other unlicensed decryption software. Mozaex only ships with a licensed, commercially available movie physical disc player software that includes licensed decryption software.

We believe that the court ruling was in addition to the RealDVD case another positive affirmation that Mozaex and its products are legal to make, sell, resell and service.

In addition we appreciate that the court expressed the following opinion of the DMCA which we believe affirms our position that our product is legal because Mozaex is NOT involved in the "trafficking in and marketing of [decryption] devices":

"A reading of the DMCA makes it clear that its prohibition applies to the trafficking in and marketing of devices that would circumvent encryption technology, not to the users of such technology. (See 32,1 Studios, supra, 307 F.Supp,2d at p. 1097.)"

Mozaex and their products are legal since Mozaex does not make, sell or provide any unlicensed decryption software.

The company only ships with commercially available, fully licensed decryption movie player software.

Mozaex has always and will continue to adhere to all laws including but not limited to the DMCA regarding movie copyrights.

Mozaex does not require or "induce" anyone to buy, install or use encryption software since the product may be used to play many forms of media without the use of decryption software.

Like a personal computer, Mozaex is a multi-purpose computer that can be used to play many forms of both protected (“encrypted”) and unprotected (“unencrypted”) media without decryption software.

Mozaex Media Supported Without the Use of Decryption Software

• Supported Protected Media Examples - Physical movie discs such as DVD and Blu-ray discs and pay-per-view streaming or downloaded movies from sites like iTunes, NetFlix and VUDU.
• Supported Unprotected Media Examples - Unprotected movie DVD discs, home videos, music, photos and over two hundred channels of online media including video services such as YouTube.

Disclaimer: Because the questions surrounding the movie copyright laws can be complex, confusing and evolving we feel that it is important that both dealers and end users are provided with the most up-to-date, unbiased, factual information with the intent of helping you make the most educated decisions in complying with copyright laws. We are not offering any opinion on the illegality of making, selling, providing or in any way illegally using decryption software. We encourage you to seek your own legal counsel to answer any legal questions you may have.

Statements Made on Kaleidescape’s Web Site That We Don’t Agree With

From Kaleidescape’s web site. Refer to: kaleidescape.com What about "DVD/Blu-ray Media Servers"?

We believe that the following Kaleidescape web site statements do not correctly represent Mozaex LLC, the Mozaex product or the current state of the copyright laws in the United States:

1. Kaleidescape Statement

“We have been informed that the manufacturers of various unlicensed "DVD/Blu-ray Media Servers" advise their dealers and customers that "if you want to load media that is protected you likely will need to install additional decryption software" in order to play or copy such discs."

Mozaex Clarification

Mozaex Correction

Mozaex DOES ship with fully licensed decryption software to play movie discs therefore you DO NOT "need to install additional decryption software" to "play … such discs"

2. Kaleidescape Statement

“It is our understanding that the use of such unlicensed software to break the copy protection on discs is generally illegal in the USA and could constitute a violation of the Digital Millennium Copyright Act (the "DMCA").”

“Based on its current knowledge, Kaleidescape believes that the installation of these "DVD/Blu-ray Media Servers", including obtaining the third-party software to get them working as advertised, would result in dealers and/or their customers in the USA committing criminal acts and risking heavy fines or jail time.”

Mozaex Correction

Mozaex does not agree with these statements. Based on two recent court cases, namely the RealDVD and the Kaleidescape cases, Mozaex believes that these two statements are misleading and misrepresent the courts understanding of the DMCA as it relates to the USE OF DECRYPTION SOFTWARE . On the contrary it is our position that these two cases AFFIRMED that the DMCA DOES NOT PROHIBIT “OBTAINING” OR “USE” of decryption software for LEGAL PURPOSES per this quote from the recent Kaleidescape permanent injunction ruling:

"A reading of the DMCA makes it clear that its prohibition applies to the trafficking in and marketing of devices that would circumvent encryption technology, not to the users of such technology. (See 32,1 Studios, supra, 307 F.Supp,2d at p. 1097.)"

Highlighting Note: the underlined emphasis above was added for clarity purposes in the reprinting of these statements and quotations.

Dealers

1. Do Not Sell any Unlicensed Decryption Software – As discussed in the section above it is illegal to SELL decryption software. Only the End User is allowed to purchase and use decryption software for legal purposes.
2. Do Not Illegally Use any Unlicensed Decryption Software - Do not for example, copy "non-owned" movies including but limited to rentals or borrowed movies onto a media server for yourself or an End User. Do not assist an End User in illegally copying non-owned movies onto a media server. This may also be referred to as “contributory infringement".
3. Optionally Have End User Sign A Hold Harmless Agreement - We believe that since our products are legal and our Sales Terms and Conditions includes an indemnification clause it is not required to have additional indemnification agreements signed by the End User.
   
   However If you believe that you need additional legal protection against losses caused by the End User’s illegal use of the media server you should consider having the End User sign a Hold Harmless Agreement (HHA) similar to the one that is included with the Mozaex Dealer Sales Terms and Conditions Agreement.

End Users

1. Do Not Illegally Use any Unlicensed Decryption Software - Do not for example, copy “non-owned” movies including but limited to rentals or borrowed movies, onto a media server for yourself or an End User.

• WE BELIEVE IT IS LEGAL TO PURCHASE OR USE DECRYPTION SOFTWARE FOR LEGAL USES
  
  We agree with the legal experts opinions referenced in the articles below, that "copying DVD’s for personal use "may well be" lawful under the Fair Use Doctrine of the Copyright Act" (Click link to learn more).
  
  "A reading of the DMCA makes it clear that its prohibition applies to the trafficking in and marketing of devices that would circumvent encryption technology, not to the users of such technology. (See 32,1 Studios, supra, 307 F.Supp,2d at p. 1097.)"
• IT IS LEGAL TO MAKE, SELL AND SUPPORT A MEDIA SERVER WITHOUT DECRYPTION SOFTWARE.
  
  As it is with the 100 million Personal Computers shipped with Media Center type software and other movie playback software a media server that does not include any unlicensed decryption software is also NOT illegal to make, sell or support.
• IT IS NOT LEGAL - TO MAKE, SELL OR PROVIDE DECRYPTION SOFTWARE
  
  Based on the Digital Millennium Copyright Act (DMCA) it is illegal to make, sell or provide [ie: give away] decryption software. However, the DMCA does not prohibit the purchase and legal use of decryption software.

There have been numerous articles on this subject including the ones referenced below. It is also recommended that you contact your own legal counsel regarding any questions that you might have concerning this subject.

• Wired article: “But the decision, although mixed, left open the door that copying DVD’s for personal use “may well be” lawful under the fair use doctrine of the Copyright Act, although trafficking in such goods was illegal.”
• Wired article: “However, she stopped short of sanctioning personal use copies, and gave a conflicting message on whether it was legal.” “So while it may well be fair use for an individual consumer to store a backup copy of a personally owned DVD on that individual’s computer, a federal law has nonetheless made it illegal to manufacture or traffic in a device or tool that permits a consumer to make such copies,” [Judge] Patel said.
• Wired article: "The law is deeply unclear. The reality, as far as I know, nobody has ever been sued for making a personal use DVD or CD," said Fred von Lohmann, an Electronic Frontier Foundation attorney.

Links to specific articles on Copyright laws:

• Click here to read the Wired article entitled "Judge Rules DVD-Copying Software Is Illegal"
• Click here to read the Wired article entitled "Hollywood Control of DVD-Copying at Crossroads"

For additional information contact your Mozaex Project Manager by clicking here