Starz Copyright Lawsuit Against MGM Allowed to Proceed by Appeals Court
MGM got caught with its hand in the cookie jar and the 9th Circuit Court of Appeals says that the studio might just have to pay for it. In a ruling on Thursday, the court upheld a lower-court decision that gives premium cable channel Starz permission to continue its breach of contract lawsuit first filed over two years ago.
While browsing Prime Video’s movie catalog, a Starz employee discovered that “Bill and Ted's Excellent Adventure” was available to stream via the service, despite an exclusivity agreement between MGM and Starz for the film. Upon further inspection, the entertainment company found over 200 films that had been licensed to other services in direct violation of the agreement, some of which were on MGM’s own EPIX channel.
The licensing contracts established in 2013 and 2015 gave Starz access to 585 movies and 176 TV shows. The $70 deal had been breached as early as 2015, with many of the titles simultaneously licensed to third parties without Starz’s knowledge. At the time of the suit, MGM countered that Starz is simply attempting to compensate for its own “competitive shortcomings,” a statement that has aged poorly as the lawsuit moves forward.
In an attempt to stop the proceedings, MGM asserted that Starz filed its complaints too late for litigation, but a district court found major flaws with that argument and the 9th Circuit agreed.
“The panel held that the district court correctly applied the discovery rule to conclude that plaintiff timely filed its claims of copyright infringement,” the court's ruling stated. “Because Starz brought its claim within three years after its claim accrued, Starz is not barred from seeking damages for all acts of infringement.”
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