Seattle – RealNetworks (NASD:  RNWK) announced late Wednesday that it has
dropped its appeal of a federal court ruling that found its DVD-copying RealDVD
software infringed copyrights, and has agreed to pay the movie studios that
sued the company $4.5 million to cover legal fees. Seattle-based RealNetworks,
which first introduced the RealDVD software in September 2008, also agreed to
an injunction against further distribution or support of RealDVD.

As a result,
the company will also shutter the metadata service that feeds DVD cover art and
movie information for the existing approximately 2,700 users of RealDVD.

are pleased to put this litigation behind us," said Bob Kimball, president
and acting CEO for Real.

"This is another step toward fulfilling our
commitment to simplify our company and focus on our core businesses. Until this
dispute, Real had always enjoyed a productive working relationship with Hollywood. With this
litigation resolved, I hope that in the future we can find mutually beneficial
ways to use Real technology to bring Hollywood’s
great work to consumers."

The DVD Copy Control Association (DVD CCA), which
represents studios and patentholders of anti-copying technology on DVDs, argued
that RealDVD violated the license of its Content Scramble System (CSS), and
made illegal permanent copies of copy-protected DVDs.

"Almost from the
moment this product was introduced, it was clear RealDVD violated the CSS
license," said Jacob Pak, president of DVD CCA.

"Now, after months of
arguments from both sides, the legal message is clear: making a DVD copier is a
breach of the CSS license."


Related Links:

(RealNetworks statement)
(DVD CCA statement)
(DMW previous coverage)