injunction, it implicitly accepted that RealNetworks was exposed to injury cognizable by the
DMCA.
Third, the case raised the issue of whether a plaintiff who demonstrates a likelihood of
success on the merits of claims under Section 1201 of the DMCA is entitled to a presumption of
irreparable harm for purposes of a preliminary injunction, as would be the case in a showing of
likely success on a claim for copyright infringement. The court noted that this must be
considered an open issue: “Because the DMCA is a recently-enacted statute, there appears to be
no authority holding that a plaintiff seeking a preliminary injunction who shows a reasonable
likelihood of success on a claim arising under section 1201 of the DMCA is entitled to a
presumption of irreparable harm.”^1033 Accordingly, the court considered in each instance
whether Streambox’s violations of the DMCA were likely to cause irreparable harm.
Turning to the plaintiff’s claims under the anti-circumvention provisions of the DMCA,
the court noted that RealNetworks’ products embodied two technological measures to control
against unauthorized access or copying of content. First, a “Secret Handshake” – an
authentication sequence that only RealServers and RealPlayers knew – ensured that files hosted
on a RealServer could be sent only to a RealPlayer. Second, a “Copy Switch” was used, which
was a piece of data in all RealMedia files that contained the content owner’s preference
regarding whether or not the stream could be copied by end users.^1034 RealPlayers were designed
to read the Copy Switch and obey the content owner’s wishes.
The court ruled that the Secret Handshake constituted a technological measure that
effectively controlled access to copyrighted works within the meaning of Section 1201(a)(3)(B),
and that the Copy Switch constituted a technological measure that effectively protected the right
of a copyright owner to control the unauthorized copying of its work within the meaning of
Section 1201(b)(2)(B). The court concluded that, because Streambox VCR was primarily
designed to bypass the Secret Handshake and circumvent the Copy Switch (and had only limited
commercially significant purposes beyond the same), Streambox VCR violated Sections
1201(a)(2) and 1201(b) of the DMCA.^1035
The court rejected Streambox’s defense that Streambox VCR allowed consumers to make
“fair use” copies of RealMedia files under the Supreme Court’s decision in Sony Corp. v.
Universal City Studios, Inc.^1036 The court distinguished the Sony case on the ground that, in
Sony, the Supreme Court based its holding on the fact that video cassette recorders were mostly
used by consumers for “time shift” viewing of programs, rather than the redistribution of perfect
digital copies of audio and video files, and that substantial numbers of copyright holders who
broadcast their works either had authorized or would not object to having their works time-
shifted by private viewers. In the instant case, the court noted, copyright owners had specifically
(^1033) RealNetworks, 2000 U.S. Dist. LEXIS 1889 at 17.
(^1034) Id. at 6.
(^1035) Id. at *19-21.
(^1036) 464 U.S. 417 (1984).