Buena Vista Sued for Selling Shows to iTunes

Starz Entertainment, LLC, has filed a suit against Buena Vista Television, subsidiary of the Walt Disney Co., for copyright infringement and breach of contract. Starz claims that Disney recently began to sell the same movies that Disney licensed exclusively to Starz, over the Internet. The suit notes that Disney has begun to sell over the Internet via services like Apple Computer Corp.'s iTunes and Walmart.com, the very same Disney films licensed to Starz.

The suit seeks to prevent BVT from continuing to infringe on Starz's rights and asks for all profits BVT has realized from its infringing activities.

Under the terms of the 1993 and 1999 Starz-BVT agreements, extended by BVT in 2005, Disney is prohibited from selling its films for transmission over the Internet prior to Starz's first exclusive license period and during all of Starz's exclusive license periods. Such conduct, the suit adds, constitutes 'a blatant breach' of the licensing agreements between BVT and Starz. The suit also notes that over the life of the contract Starz has paid over one billion dollars for periods of exclusive rights to the films.

The suit notes that the licensing agreements do allow Disney to distribute its films on a pay-per-view or on-demand basis defined as the viewing of a motion picture by a consumer who is charged a fee to view the film over a limited period of time. It also permits home video distribution where consumers may purchase or rent a motion picture embodied in a video device which is a physical entity (including, without limitation, video cassette, laser video disc and DVD) But the suit points out that other than these clearly defined exceptions, the agreements prohibit BVT from licensing its films 'for exhibition in any form of television or electronic delivery.'

Starz Entertainment is the exclusive subscription television and broadband provider of first-run films from leading Hollywood studios including Walt Disney Pictures, Sony Pictures Entertainment, Overture Films, Revolution Studios, Miramax Films, Touchstone Pictures, Hollywood Pictures, Pixar, TriStar, Screen Gems, Sony Classics and Warren Miller Films.