Redbox Asks Judge To Dismiss Disney's Suit Over Digital Downloads

Striking back at Disney, Redbox says a lawsuit filed by the studio represents an "illegal attempt" to prevent the sale of digital movies.

"Disney has already been paid its full price for every digital copy of a Disney movie that Redbox sells," the video rental company says in papers filed Thursday with U.S. District Court Judge Dean Pregerson in the Central District of California. "This case is not about Disney losing sales due to unlawful copying. Disney has lost no sales. This case is about Disney’s illegal attempt to prevent Redbox from reselling digital movies it bought at retail to price-sensitive consumers who will benefit from lower prices."

Redbox's papers come in response to Disney's recent lawsuit accusing Redbox of infringing copyright by selling codes that allow consumers to download movies like "Finding Dory," "Guardians of the Galaxy," and "Star Wars." Disney also claims that Redbox violates its contract with Disney, and engages in false advertising by failing to tell consumers they aren't authorized to use the codes.

The video rental company purchases combination packages that include a DVD, Blu-Ray Disc and code for a digital download from the site, the lawsuit alleges. After purchasing the packages, Redbox rents or sells the discs at its kiosks, and separately sells the digital download codes, according to Disney's complaint.

Disney alleged in its complaint that the combination packages -- referred to as "combo packs" in the court papers -- state the codes aren't transferable. Redbox disputes that most of those packages include language stating "not for sale or transfer" on the outside of the boxes. The company also says that purchasers of the combination packs, like itself, don't agree to follow Disney's terms merely by buying the product.

"The complaint does not allege that anything conspicuously alerts a retail purchaser of a Combo Pack that she is entering into a contract for which she can be sued, nor does it allege that Combo Packs are sold with 'shrink wrap' licensing conveying that opening the box conveys an agreement to any terms," Redbox argues.

The video rental company also says Disney's allegations don't amount to copyright infringement -- either by Redbox or its customers. "The code that Disney sells works for a single user, and only provides rights for that user to access a digital copy," Redbox says.

Pregerson is expected to hold a hearing in the case on February 5.

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