RealNetworks (s RNWK) has finally settled a lawsuit it filed 18 months ago against Viacom (s VIA) and six Hollywood studios, by agreeing to pay them $4.5 million in legal fees and to shut down any remaining services tied to its ill-fated RealDVD software. The settlement puts to rest one of the last major mistakes RealNetworks made under former CEO Rob Glaser, who resigned in January after running the company for nearly 16 years.
The case revolved around RealDVD, a DVD-copying software package that RealNetworks introduced in late 2008. The software allowed users to copy entire movies from DVDs onto PCs, external storage drives or flash drives, which Real argued was legal because it didn’t alter or compress the original file. RealDVD also added an encryption layer so that users could only play back a movies on licensed computers.
But after being pressured not to release the software, RealNetworks filed a preemptive lawsuit in September 2008 against the major motion picture studios, guessing (correctly) that they would file suit to halt sales of RealDVD. And it was all downhill from there: the studios countersued, the court stopped sales of the software, and RealNetworks ended up losing both cases against the Hollywood studios.
RealNetworks had appealed the decision while Glaser was in charge, but now it appears that cooler heads have prevailed. In addition to paying $4.5 million to settle legal fees, RealNetworks has agreed to withdraw its appeal and to halt distribution of RealDVD or “any other technology that enables the duplication of copyrighted content protected by the Content Scramble System, ARccOS, or RipGuard.” Real has also agreed to turn off the metadata service that feeds cover art and movie information to the lucky 2,700 customers who were able to snag a copy of RealDVD before the court barred its sale, and will refund those poor souls the money they paid for the software.
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