Disney has sued video rental company
Redbox for infringing copyright by selling codes that allow consumers to download movies like "Finding Dory," "Guardians of the Galaxy," and "Star Wars."
"Redbox markets its offering of the
Codes as 'cheap,' a 'Smart buy,' and a low-price alternative to authorized digital services," Disney alleges in a complaint filed Thursday in U.S. District Court for the Central District of
California. "Redbox does so to attract customers who would otherwise purchase a Combo Pack or licensed digital offering through an authorized distributor."
On Friday afternoon, Redbox advertised a digital download code for "Guardians of the Galaxy Vol. 2" for $7.99, while Amazon Prime was selling the
combined DVD/Blu-ray/digital code for $15.
Redbox allegedly purchases combination packages that include a DVD, Blu-Ray Disc and code for a digital download from the site
ReedeemDigitalMovie.com. Those combination packages state that the codes are not transferable, Disney says.
After purchasing the packages, Redbox allegedly rents or sells the discs at its
kiosks, and separately sells the digital download codes. Disney adds that Redbox doesn't tell consumers they aren't authorized to use the codes.
The complaint alleges a host of claims,
including that Redbox contributes to copyright infringement by consumers, violates its contract with Disney, and engages in false advertising by failing to tell consumers that they are not authorized
to use the codes.
Disney is seeking an injunction prohibiting Redbox from selling the codes, and monetary damages of at least $150,000 per infringement.
This lawsuit isn't the first
time Hollywood studios have battled companies that attempted to offer digital movies. Among other instances, in 2011 the Motion Picture Association of America successfully sued to shut down the online service Zediva, which charged web users $2 to stream
movies.