Studios Sue Zediva, Charging Copyright Infringement

Streaming service claims it is analogous to a DVD rental chain and does not have to pay licensing fees

The six major studios are suing the operators of  movie-streaming service Zediva for copyright infringement, the Motion Picture Association of America (MPAA) announced  Monday on behalf of its members.

Zediva, a nearly two-year-old site, rents new releases for $2 and for a two week period — that's far below the rate set at bricks and mortar chains such as Blockbuster. 

Zediva has previously said that it is not obligated to pay licensing fees to movie companies because it is streaming DVDs not sharing files. Under the First Sale Doctrine, Zediva says it can rent or re-sale the discs it owns. 

That's a claim that the studios reject, noting that streaming sites such as Netflix have had to reach deals with the studios to stream their content. 

"Defendants' comparison of the Zediva service to a rental store is disingenuous, and defendants are attempting to rely on technical gimmicks in an effort to avoid complying with U.S. Copyright Law. Defendants operate an online VOD service, not a neighborhood rental store," the complaint reads.

Further, they say that the First Sale Doctrine does not apply and that by distributing films digitally, Zediva is violating the studios' right to "publicly perform" their movies. 

A spokesperson for Zediva did not immediately respond to request for comment. 

Zediva's parent company WTV Systems, Inc. and Venkatesh Srinivasan, the company's founder and CEO are named as defendants. The studios are seeking an injunction and unspecified damages.