RealDVD case: Real introduces surprise witness

Update 6:20 a.m. Thursday: To include more background on new witness.

RealNetworks introduced a new witness in the RealDVD case on Wednesday, a move that comes late in the court proceedings that could decide the software's fate.

Real is locked in a court battle with the major movie studios over RealDVD, a software that enables owners to copy DVDs and store them to a hard drive. The Motion Picture Association of America filed suit against Real last fall, accusing the company of violating copyright law and breach of contract. U.S. District Judge Marilyn Patel could rule on whether to remove a ban on the sale of RealDVD as early as Thursday.

Real on Wednesday filed with U.S. District Court for the Northern District of California a written declaration from Peter Biddle, an Intel executive who had dealings with the movie industry over a decade ago while employed for Microsoft. He disputes Hollywood's claims that the industry included in a license for its DVD-encryption technology a ban on copying DVDs while in a computer hard drive.

Real argues that because it possesses a license to use CSS and because the license doesn't prohibit the copying of DVDs in all cases, Real isn't guilty of breaching its contract.

What Biddle focuses on in his statement is the license for DVD Content Scramble System (CSS), the encryption technology designed to prevent copying of DVDs. Companies need the license to make DVD players. In his declaration, Biddle says that he was part of the "standards-setting" group that helped draft the CSS license between 1996 and 1998. According to court documents, he has not been compensated by Real. It is not yet clear whether Patel will allow Biddle to testify in court.

He confirmed that the film industry was initially against allowing the copying of DVDs under any circumstances. But he said eventually the studios relaxed their position.

"I repeatedly explained that such a prohibition would be extremely difficult to implement," said Biddle in his declaration, recalling what he said during negotiations on what language the CSS license should include. "Because computer and software products rapidly evolve, the CSS license was designed to enable computer manufacturers to have significant freedom."

He says it was never agreed to that the CSS license would ban all copying.

Marsha King, a retired vice president at Warner Bros., testified during the hearing that the entire reason for the CSS license was to prevent consumers from creating copies.

"The studios were adamant that no copy be placed on the (computer) hard drive," King told the court. "The only thing we authorized was playback of the movies...no copies were to be made...it was a mantra."

In the past week, Real has introduced Biddle and filed new allegations against the film industry, accusing them of antitrust violations. The question is whether these moves are just 12th-hour legal wrangling or will have legitimate impact on the case.

In a letter to Patel, Real's attorneys said that they were unable to locate Biddle until May 6, and weren't clear about what he would testify to until Wednesday. This makes little sense as Biddle, the man behind Microsoft's BitLocker technology and Darknet, is pretty high profile and a Google search quickly reveals he is Director of the Google Program Office at Intel and lives in the Seattle area.

Patel is scheduled to hear closing arguments on Thursday morning. There's no telling when she will issue a decision, but she has a history of ruling from the bench.