Controversial DVD backup software, DVD X Copy, will continue to be available in Australia - despite its parent company's slide into liquidation - via a Taiwan-based company trading as X Software.
ARN has learned that X Software has acquired publishing rights to
DVD X Copy from US-based developer 321 Studios and will continue to supply Australian distributors and resellers.
In December, Sydney-based technology distributor, Conexus, was threatened with legal action by the Australian Federation Against Copyright Theft (AFACT).
AFACT demanded DVD X Copy be withdrawn immediately or Conexus would be sued on the grounds that it was infringing Australian copyright law.
Resellers were also contacted and asked to remove 321 Studios' entire product line from their shelves.
"It was a hugely popular product, and this impacted dramatically on our sales," Conexus general manager, Andrew Daton, said. Much of the concern over the product surrounded DeCSS, a ripping technology developed by 321 Studios that circumvented the Contents Scrambling System (CSS) on US DVDs.
Conexus has, however, established a partnership with X Software and will continue to distribute DVD X Copy in Australia, albeit without the DeCSS module.
AFACT's executive director, Adrianne Pecotic, said the organisation had yet to receive confirmation of any products to be sold in Australia.
"AFACT, on behalf of its members, will seek to ensure that all rights under the Copyright Act are enforced and that member's products are not left unprotected," she said.
"No person or company should be permitted to make a business out of breaking the law - and undermine the legitimate income of Australians - by enabling illegal copying of film and television product."
Privately-held 321 Studios had been struggling with multiple lawsuits in the US and closed for business last week.
The company's founder, Robert Moore, originally released the bankruptcy news through a post on the company's discussion forum.
"Due to the overwhelming expense of our lawsuits and litigation and severely declining revenue, 321 Studios will be filing for Chapter 11 bankruptcy protection," he said.
When asked whether the company would emerge intact at the other end, Moore said: "While it would be our firm desire to do so, the direct and collateral damage to our name and reputation from the lawsuits has caused us severe and even irreparable business harm."
In the US, resellers found themselves the target of lawsuits from Hollywood studios Twentieth Century Fox and Paramount Pictures, while software copy protection vendor Macrovision sued 321 Studios directly for illegally bypassing its system.
Although the software had been modified to remove the technology used to circumvent the US scrambling and add user registration, IP address capturing and embedded warnings about the dangers of piracy, Moore's company continued to be the target of lawsuits.
321 Studios had also offered a reward for any information leading to the conviction of individuals using DVD X Copy to infringe copyright legislation.
In April 2003, 321 Studios sued Metro-Goldwyn-Mayer following the studio labelling DVD X Copy as "the electronic equivalent of breaking into a locked room".
Moore attempted to use the Internet to drum up help, offering $US1000 to anyone that could compile a list of DVDs that were no longer available, without CSS or contained material that wasn't available anywhere else.
As part of the final settlement, 321 Studios will make a substantial payment to the motion picture industry which, according to the Motion Picture Association of America (MPAA), will be used to fund further fights against piracy.