UMG Tries to Force DivX to Use Audible Magic

8/14/2019 UMG Tries to Force DivX to Use Audible Magic

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Case 2:07-cv-06835-AHM-AJW Document 141-3 Filed 02/18/2009 Page 1 of 23


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JOINT STIPULATION RE UMGS MOTION TO COMPEL: CV07-06835

RONALD L. JOHNSTON (State Bar No. 57418)[email protected] MORRIS (State Bar No. 200368)[email protected] M. NISHIMOTO (State Bar No. 235208)[email protected] & PORTER LLP

777 South Figueroa Street, 44th FloorLos Angeles, California 90017-5844Telephone: 213.243.4000Facsimile: 213.243.4199

Attorneys for PlaintiffsUMG RECORDINGS, INC, et al.

[Additional Counsel Listed on Signature Page]

UNITED STATES DISTRICT COURT

CENTRAL DISTRICT OF CALIFORNIA

UMG RECORDINGS, INC., et al.,

Plaintiffs,

v.

DIVX, INC., a Delaware corporation;

DOES 1-10, inclusive,Defendants.

Case No. CV 07-06835 AHM (AJWx)

JOINT STIPULATION PURSUANTTO LOCAL RULE 37-2REGARDING UMGS MOTION TOCOMPEL RESPONSES TODISCOVERY FROM DIVX, INC.

[Filed concurrently with: Notice ofMotion; Declaration of Sean Morris;Declaration of Lee Milstein]

Date: January 26, 2009Time: 10:00 a.m.Courtroom: 690Judge: Hon. Andrew J. Wistrich

Case Filed: 10-22-07Discovery Cutoff: 6-1-09

Pretrial Conference: 11-2-09Trial Date: 11-17-09

Case 2:07-cv-06835-AHM-AJW Document 99 Filed 01/05/2009 Page 1 of 22

Ex. B, Pg. 4



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TABLE OF CONTENTS

Page

I. INTRODUCTORY STATEMENTS ..................................................................1

A. UMGs Introductory Statement ................................................................1

B. DivXs Introductory Statement.................................................................3

II. VERBATIM STATEMENT OF DISCOVERY REQUESTS IN ISSUEAND CONTENTIONS CONCERNING EACH REQUEST.............................4

UMGS CONTENTIONS REGARDING DOCUMENT REQUEST NO. 2 ...............4

A. UMG Is Entitled to Identify Additional Infringed Works, ButDivX Has Refused To Permit UMG Access To The Information............5

B. UMG Proposed A Reasonable Means To Obtain The InformationNecessary To Identify Works At Issue, But DivX Refuses ToPermit UMG Access To The Database.....................................................7

C. UMG Has Already Filed A Motion To Extend The Deadline ToIdentify Works Until A Reasonable Period After UMG Is GivenAccess To DivXs Database Of Works...................................................11

DIVXS CONTENTIONS REGARDING DOCUMENT REQUEST NO. 2 ............12

A. Judge Matz Correctly Recognized that UMGs Demand for theEntire Contents of the Stage6 Site is Unreasonable................................12

B. UMGs Request for All Removed Videos is Overbroad and SeeksInformation That Is Not Relevant to Any Issue in the Case...................14

1. UMG Has Not Made a Relevance Justification forProduction of the 750,000+ Videos from the Stage6Service...........................................................................................15

2. DivXs Proposal Addresses UMGs RelevanceConcern and Accounts for the Overbreadth ofUMGs Request ............................................................................16

C. UMG Seeks Through its Demand to Impose Undue Burden onDivX ........................................................................................................17

III. CONCLUSION .................................................................................................19

A. UMGs Conclusion .................................................................................19

B. DivXs Conclusion..................................................................................19


Ex. B, Pg. 5



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Pursuant to Rule 37 of the Federal Rules of Civil Procedure and Local Rule 37-

2 of the Local Rules of this Court, plaintiffs UMG Recordings, Inc., Universal Music

Corp., Songs of Universal, Inc., Universal-Polygram International Publishing, Inc.,

Rondor Music International, Inc., Universal Music - MGB NA LLC, Universal Music

- Z Tunes LLC, and Universal Music - MBG Music Publishing Ltd. (collectively,

UMG) and defendant DivX, Inc. (DivX) respectfully submit the following Joint

Stipulation Regarding UMGs Motion to Compel Discovery. Pursuant to Local

Rule 37-2.1, attached as Exhibit 1 is a copy of the Scheduling and Case Management

Order, dated August 25, 2008, entered in this case.

I. INTRODUCTORY STATEMENTS

A. UMGs Introductory Statement

As this Court is aware, UMG has brought this and similar actions against

video-sharing websites to address rampant copyright infringement. Through its

Stage6.divx.com (Stage6) website, DivX -- like the defendants in the MySpace,

Grouper, and Veoh actions -- provided video content to its users and invited the

public to upload, download, view [and] share the videos. Even before the

commencement of discovery, UMG was able to locate infringements of over 2,000works on the Stage6 website. UMG has identified each of these 2,000 infringed

works to DivX, provided ownership information regarding the works, and advised

DivX where on its site each of the infringements could be found.

After this suit was commenced, however, DivX abruptly shut the site down.

This motion is required because DivX now refuses to give UMG access to the site so

that further infringements can be determined, despite proper discovery requests by

UMG and this Courts direction -- at DivXs urging -- that UMG proceed to identify

other infringements on the DivX site.

More specifically, at the initial Scheduling Conference in this case, DivX

requested that UMG be required to identify all of the infringements that would be

included in this action. DivX informed the Court that it wanted UMG to identify all


Ex. B, Pg. 6



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of the infringements at issue to preclude UMG from adding and dropping works on

an ad hoc basis during the course of the litigation.

The Court informed the parties that it would order that UMG identify the

works at issue to set an outside limit on potential issues of liability and

corresponding damages and to establish the contours for what this case is about.

For those works that UMG already had located prior to discovery, UMG was required

to provide the information to DivX within 30 days, which UMG did by identifying

the exact website address (URL) where the over 2,000 infringements were located, as

well as the copyright registration information for each work. What UMG could not

have anticipated was that after the conference, DivX would refuse to provide a copy

of or access to its electronic database, as UMG requested in Document Request

No. 2. DivXs actions thus have made it impossible for UMG to identify the

additional works that will be at issue in this suit.

UMG has proposed, as an alternative to production of the entire database, an

industry accepted alternative method of electronic review of the database, by an

independent company in the business of accessing databases for such purposes, to

determine infringements on the DivX site. This alternative proposal was made over

two months ago. It represents an automated and cost-efficient method of reviewing

the DivX files electronically, automatically identifying those files that match the

sound patterns of relevant sound recordings and generating a list of those matches.

DivX refuses to allow this type of search to occur, without any good reason.

As DivX is well aware, until UMG is provided with access to the DivX

database, it will be impossible to identify the additional works at issue, as previously

required by the Court and, indeed, requested by DivX. Accordingly, UMG

respectfully brings this motion to compel production of DivXs database or, in the

alternative, access to the DivX database such that automated searching can occur.


Ex. B, Pg. 7



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B. DivXs Introductory Statement

When UMG told Judge Matz that it would in discovery be seeking the entire

contents of the massive video archive that was formerly DivXs Stage6 service, Judge

Matz responded that such a demand wouldnt be reasonable even if it were feasible

for DivX to comply. Undaunted, UMG proceeded to make precisely that demand of

DivX, ignoring the staggering overbreadth and the undue burden that compliance

would entail.

UMG has readily acknowledged that while there were more than the 750,000

videos accessible through the Stage6 service during its brief existence, UMG expects

this case to implicate no more than a few thousand. Nevertheless, UMG insists it has

a right to obtain the entire video archive, including hundreds of thousands of

undisputedly irrelevant videos, rather than accepting some reasonable subset. UMG

has also rejected an approach by which it would receive a searchable index to the

contents of the video archive from which it could identify those potentially relevant

to this case. UMG doggedly insists on receiving the entire library of archived videos

in the hopes of finding a few of actual interest to it. That is not the reasonable

tailoring of discovery that the Federal Rules envision.In any event, given the massive burden that production of the entire archive

would entail, Judge Matz had it exactly right when he said UMGs demand for the

contents of the Stage6 site would not be reasonable and would draw objections from

DivX. The cost of restoring the archived videos and creating a copy from them could

be hundreds of thousands of dollars. As DivX earned no profit from the operation of

Stage6, and UMG apparently suffered no losses, the amount UMG demands that

DivX spend on this single effort dwarfs any amount legitimately in dispute between

the parties. UMGs request to electronically scan the entire archived video library

does nothing to mitigate this burden. Before UMGs consulting service could even

begin, the substantial costs of restoring the video archive to accessibility would need

to be incurred. Moreover, to employ its service, UMG would still need a copy of the


Ex. B, Pg. 8



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archive both to ensure the integrity of the original data and for evidentiary purposes

in the case.

DivX has made clear that it will allow UMG to copy the entire library of

videos, provided it does so at its own expense. UMG can then use that copy for

whatever purpose it chooses. Despite the supposed importance of the library to it,

however, UMG is unwilling to bear the cost of obtaining it. That, more than anything

else, reveals what is actually behind this motion. UMG has already identified nearly

2000 copyrighted works and alleged infringements to be litigated in this case, more

than enough to allow the parties to assess the merits of their claims and defenses.

This unreasonable demand and unnecessary motion practice are simply means of

imposing additional burdens on DivX rather than the pursuit of legitimate discovery.

UMGs motion to compel should therefore be denied.

II. VERBATIM STATEMENT OF DISCOVERY REQUESTS IN ISSUE

AND CONTENTIONS CONCERNING EACH REQUEST

DOCUMENT REQUEST NO. 2:

An electronic copy of any database, in the same format as it is or was kept in

the ordinary course of business, containing the Content, including the works, files,

and videos, that appeared on Stage6.

RESPONSE TO DOCUMENT REQUEST NO. 2:

Defendant objects to this request on the grounds that it is overbroad and unduly

burdensome. The Stage6 service is no longer operational and its contents is not

readily accessible. Defendant further objects to the extent this request seeks

discovery that is not relevant to the subject matter of this litigation nor reasonably

calculated to lead to the discovery of admissible evidence. Defendant objects to this

request on the grounds that it is vague and ambiguous at least as to the phrases any

database, the works, files, and videos, and appeared on Stage6. Defendant

objects to this request to the extent it seeks documents protected by the attorney client

privilege, attorney work product doctrine, or any other applicable privilege.


Ex. B, Pg. 9



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Defendant objects to this request to the extent is seeks private and confidential

information relating to individuals who are not party to this litigation and not present

to assert objections on their own behalf. Defendant objects to this request to the

extent it seeks documents containing confidential or proprietary information, trade

secrets or other intellectual property, commercially sensitive information, and/or

protected third party information. Defendant objects to this request to the extent it

seeks information protected from disclosure by any statute, rule, or regulation

including but not limited to the Electronic Communications Privacy Act. To the

extent that any such documents are produced, the production will only occur

following the entry of a suitable protective order and only to the extent Defendant can

do so consistent with Defendants legal and confidentiality obligations. Subject to,

and without waiving, these specific objections and the General Obligations set forth

above, Defendant responds as follows:

Defendant is in the process of meeting and conferring with Plaintiffs regarding

the means, reasonableness, feasibility and legality of producing certain materials

sought by this request, as well as which party should bear the expense of any such

production.

UMGS CONTENTIONS REGARDING DOCUMENT REQUEST NO. 2:

A. UMG Is Entitled to Identify Additional Infringed Works, But DivX

Has Refused To Permit UMG Access To The Information

UMG filed this case on October 22, 2007. On February 28, 2008, before

formal discovery could begin, DivX shut down the Stage6 website. Although UMG

had been able to identify over 2,000 infringements on the Stage6 website by

searching the site as a typical end-user might (a costly and inefficient way of

searching for works), once the site was no longer live, there was no way for UMG to


Ex. B, Pg. 10



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identify the additional infringements. Additionally, UMG has no way of verifying

whether its method of searching the Stage6 website returned all infringing files.1

In connection with the initial Scheduling Conference held on August 25, 2008,

DivX requested that UMG be required to identify all of the infringements that would

be included in this action. E.g., Morris Decl. 2, Exh. A [Rule 26 Report at 9:22-23

(stating DivXs position that the discovery it will seek regarding the works cannot

even commence until UMG identifies (by name, copyright number, and allegedly

infringing video) all of the copyrighted works that it alleges to have been

infringed)]. DivX informed the Court that it wanted UMG to identify all of the

infringements at issue to preclude UMG from adding and dropping works on an ad

hoc basis during the course of the litigation. Morris Decl. 3, Exh. B [Transcript at

4:14].

During the Scheduling Conference, the Court informed the parties that it would

order that UMG identify the works at issue to set an outside limit on potential issues

of liability and corresponding damages and to establish the contours for what this

case is about. Id. [Transcript at 7:21-23, 7:24-25]. For those works that UMG

already had located prior to discovery, UMG was required to provide the information

to DivX within 30 days, which UMG did by identifying the exact website address

(URL) where the over 2,000 infringements were located, as well as the copyright

registration information for each work. Morris Decl. 4, Exh. C.

The Court then asked what a reasonable timetable for identification of

additional works might be. Counsel for UMG informed the Court that the length of

time needed for identifying additional works depends upon looking at their website

thats been archived, as I understand it, and doing tests on that. Morris Decl. 3,

Exh. B [Transcript at 8:11-12]. Counsel further explained that it would need to have

1For example, it is not uncommon for websites similar to the Stage6 website to cap the number of

return hits to an end user by limiting the number of returned pages.


Ex. B, Pg. 11



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somebody analyze the history of content on [the site] and what content is [UMGs].

Id. [Transcript at 8:18-19]. UMG made it clear that it was not looking for DivX to

recreate the website; rather, UMG needed to be able to review the content on the

website that was now unavailable for review. Id. [Transcript at 10:22].

Counsel for UMG estimated that this type of discovery could be completed in

120 days. However, as UMG informed the Court at the time, it was not possible to

state how much time would be needed with precision, because it would depend upon

obtaining access to the files as well as coordinating with technical experts:

I have a lot of experience with computers but not this

particular issue. So when I say 120 days, Im assuming

were going to do our best to get everything together

because thats in our interest, but in terms of the technical

requirements and what it will take for technicians to

determine this, Im really speculating.

Id. [Transcript at 13:13-18]. In response, the Court stated that it underst[ood] why

[UMG] [was] providing this qualification. Id. [Transcript at 13:19-24].

During this discussion, DivX never informed UMG or the Court that it would

not provide access to its database so that it could be searched and infringements

identified. However, DivX now has informed UMG that it will not produce its

database and will not permit access to it, so that it can be searched to identify

infringements. UMG therefore requests that the Court grant its motion to compel and

enter an order directing DivX to provide to UMG either a copy of the DivX database

or access to the DivX database.

B. UMG Proposed A Reasonable Means To Obtain The Information

Necessary To Identify Works At Issue, But DivX Refuses To Permit

UMG Access To The Database

Following the Scheduling Conference, UMG propounded discovery on DivX

designed to permit UMG to identify the additional infringing works. In particular,


Ex. B, Pg. 12



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UMGs Document Request No. 2 sought an electronic copy of any database, in the

same format as it is or was kept in the ordinary course of business, containing

[audiovisual works], including the works, files, and videos, that appeared on Stage6.

Morris Decl. 5, Exh. D [Request No. 2].

On October 2, DivX wrote to UMG suggesting that instead of providing UMG

with access to the database of actual video files, DivX would provide UMG with a

list of the names of video files that appeared on Stage6 that UMG could review and

then request a copy of the video. Morris Decl. 6, Exh. E. This process, DivX

informed UMG, could cost well in excess of $250,000 (for server space,

connectivity, storage materials and contractor assistance) and may take a month or

more to complete. Id.

DivX refused to produce the database itself as requested by UMG.

Furthermore, DivXs alternative proposal to provide a list of the names of the files

within its database as the means for identifying the works at issue in this litigation

was not an appropriate solution for several reasons. Because this lawsuit is about

infringed songs, a list of the file names would not be sufficient to identify infringing

works.2 As DivX itself recognized, after UMG reviewed such a list for potentially

infringing works based on the file names (assuming this could be done), UMG still

would need to obtain access to a copy of the actual files from DivX to determine if

the file contained an infringement. This method thus would be a burdensome and

inefficient manner of proceeding. And, according to DivX, this method of

identification could still cost well in excess of $250,000. Id.

UMG therefore explored other options. Based on the limited information

UMG had obtained about DivX, UMG investigated using the service offered by

2 This is particularly true in light of the fact that apparently some of the file names donot identify the title of the song. E.g., Morris Decl. 4, Exh. C (file nameshttp://stage6.divx.com/members/173076/videos/1052704 for the song Bones byThe Killers and http://stage6.divx.com/user/neco1104/video/1892111/PRINCE-LOVE-SEXY-'88-LIVE-part1 for the song Erotic City by Prince).


Ex. B, Pg. 13



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Audible Magic. Audible Magic is a company that provides state-of-the art

software and services that search computer files for musical works, analyzes the

sound patterns in the files, and then matches them against its own database of

recordings, a process referred to as acoustical fingerprinting. Audible Magic is an

industry leader in this area. As noted in Metro-Goldwyn-Mayer Studios, Inc. v.

Grokster, Ltd., 518 F. Supp. 2d 1197 (C.D. Cal. 2007),

Acoustical fingerprinting is licensed by various companies,

including Audible Magic. This technology analyzes the

actual content of an audio file, as opposed to a written

description of what is contained within it (e.g., metadata).

. . . This means that the filtering tool listens to the sound

recording, and creates a twenty-second fingerprint that can

then be compared against any other file that an end-user is

attempting to upload or download. [ ] If the suspected file

has that precise sequence (or spectrum) of sounds, the

uploading or downloading of the song will be blocked.

According to Plaintiffs, Audible Magic has a database of

approximately 6 million acoustical fingerprints of musical

sound recordings. [ ]

* * *

Audible Magic represents that its acoustical fingerprinting

technology would successfully block well over 99% of the

files unauthorized for peer-to-peer distribution. [ ]

Id. at 1205-06 (citations and quotation marks omitted).

Accordingly, because many of the recording companies, including UMG, have

provided Audible Magic with information regarding their works, when Audible

Magic runs its software against a database of files (such as the DivX files), Audible

Magic can determine if that database contains musical works that are owned by


Ex. B, Pg. 14



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others such as UMG. As Audible Magic searches a particular database and locates

matches, it generates a report that identifies the infringing file name, the work and

artist at issue, and the owner of the work. Morris Decl. 7.

On October 13, 2008, counsel for UMG proposed to counsel for DivX that the

parties use the Audible Magic service to search the existing DivX database. Morris

Decl. 8. On October 15, DivX responded in a letter requesting that UMG give

[DivX] [UMGs] full proposal in writing, including precisely the steps you wish to

take, who would be involved, and what costs you are willing to pay. Morris Decl.

8, Exh. F.

To provide DivX with as much information as possible regarding the process

of using Audible Magic, counsel for UMG responded to DivX in a letter dated

October 23. Morris Decl. 9, Exh. G. That letter provided as much detail as UMG

could, based upon the information it knew about the DivX database. The letter also

listed some further basic questions about the database so that Audible Magic and the

parties could determine how best to proceed using that service. Id. (e.g., How many

video files are there? and What is the average length [in terms of minutes] of the

files?).

DivX responded on October 28 in a letter that provided some additional

information (e.g., there are between 700,000 and 800,000 videos all stored in the

DivX format on specialized, fragile servers), but that also asserted UMG was not

entitled to have access to all of DivXs archived videos in order to try to identify

works you might put at issue in this case, because UMG had access to the site for

the entire time it was operational (Morris Decl. 10, Exh. H) -- primarily before the

lawsuit and, in any event, before the commencement of discovery.

Despite DivXs statements regarding access to the files, UMG took the

information from DivXs letter and again discussed the issues with Audible Magic.

Morris Decl. 11. Although UMG still did not have all of the information regarding

the DivX database, UMGs best estimate was that searching the DivX database using


Ex. B, Pg. 15



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Audible Magic would require approximately one or two weeks of set up (i.e., Audible

Magic would be able to come to the location where DivX stored its database and

connect its computers to DivXs servers) and that the videos could be searched on a

rolling basis over the course of a month.3 The best estimate for the cost of running

this type of search was approximately $40,000, plus a few thousand dollars for the

initial configuration and set up. UMG provided this information to DivX in a letter

dated November 4, 2008. Morris Decl. 12, Exh. I. Although UMG believes that

DivX alone is responsible for the costs of producing its database or allowing access to

it, UMG also offered to pay half of the costs of its proposal. Id.

In response to this proposal, DivX again refused to allow the access to its

database. In a letter dated November 19, 2008, DivX informed UMG that it did not

agree that UMG is entitled to all of DivXs archived videos in order to search for

more alleged infringements and that UMGs continued effort to press DivX for

access to its archived videos is abusive (Morris Decl. 14, Exh. J) -- notwithstanding

that UMG had already identified massive infringements, including over 2,000

infringed works, on the DivX site. In further meet-and-confer attempts, DivX has

reiterated its refusal to allow the use of Audible Magic to search its files. Morris

Decl. 15, Exh. K.

C. UMG Has Already Filed A Motion To Extend The Deadline To

Identify Works Until A Reasonable Period After UMG Is Given

Access To DivXs Database Of Works

As required by the Court, UMG was able to provide detailed information

regarding the over 2,000 infringements it located on Stage6 without the aid of

discovery before the site was shut down. Morris Decl. 4, Exh. C. Having pushed

3 It is UMGs understanding that the search potentially could be accelerated bysearching only certain types of files that would fit the profile of music videos, such asby eliminating searching for any files that were shorter than 1 minute in length orover 7 or 8 minutes. Id.


Ex. B, Pg. 16



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for a deadline to identify additional works at issue in this litigation, DivX now refuses

to grant access to its database so that UMG can identify those infringing works,

calling such a request abusive.4

This request is not abusive, and UMG undeniably entitled to the information.

UMG has shown that there were a massive number of infringements on the Stage6

site through its searches conducted using the system as an end-user might. UMG

expects to find hundreds if not thousands of additional infringements once proper

access is provided to the Stage6 database. UMG therefore requests that DivX be

ordered either to provide a copy of its database to UMG as requested or to provide

access to the database so that Audible Magic can search the files.

DIVXS CONTENTIONS REGARDING DOCUMENT REQUEST NO. 2:

A. Judge Matz Correctly Recognized that UMGs Demand for the

Entire Contents of the Stage6 Site is Unreasonable

At the initial scheduling conference for this case, Judge Matz made clear that

he wished to avoid the usual skirmishing that has bogged down UMGs other

actions against online services. To that end, he set December 22, 2008 as a firm

deadline by which UMG was to complete its identification of copyrighted works and

alleged infringements in this case. In the process, Judge Matz anticipated and

rejected the very claim UMG now advances here that UMG is entitled to a copy of

the entire contents of the Stage6 site in order to perform the requisite identification.

See Morris Decl., Ex. B, pp. 21-24 (Transcript at 8-11).5 According to the Judge, a

4 UMG is in the process of moving to extend the deadline for UMG to identify theworks at issue in this litigation to 60 days after UMG is provided either with a copy

of the DivX database or with access to the DivX database. Regardless of the result ofthat motion, however, UMG is entitled to the information sought by this motion tocompel.

5 The deadline for UMG to complete its identification of works and allegedinfringements has now passed. UMG has filed a motion to extend that deadline,citing the need to obtain a complete copy of the contents on the Stage6 site. Thatmotion is set for hearing on January 5, 2009 before Judge Matz. DivX proposed thatJudge Matz hear this motion at the same time, but UMG refused. By the time thismotion is actually heard, Judge Matz may have provided further guidance on UMGs

(Footnote Contd on Following Page)


Ex. B, Pg. 17



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demand that DivX produce the entire contents of the website wouldnt be reasonable

even if it were feasible. Id., Ex. B, pp. 23-24 (Transcript at 10:9-11:3); see also Ex.

B, pp. 40-41 (Transcript at 27:16-28:21) ([Y]ou can extrapolate a whole lot of things

from what youve already learned, even if you dont have the actual content of the

website.). UMG nevertheless proceeded to serve a document request mirroring the

one that the Court had expressly criticized.

Judge Matz assessment of the burden associated with producing the actual

content of the Stage6 site was correct. DivX does not have a working database

from which the 60-70 terabytes of data that comprises the video archive can be

readily accessed or copied. See Milstein Decl. ,6 6. After the Stage6 service was

shut down in February 2008, its more than 750,000 videos were stored on expensive

and fragile Isilon servers. See Milstein Decl., 5-6. These servers are sitting in

storage at DivXs facilities and are not currently operable; they are not connected to a

network or power components. Id., 6. Moreover, there is not sufficient space or

power at DivXs facilities to run the Isilon servers for more than a brief period

without significantly disrupting business operations. Id., 7. In order for DivX (or

anyone else) to retrieve any substantial volume of data from these servers, they would

first need to be carefully transported to a data storage facility with a power supply

capable of running the servers on a network. Id., 8. Beyond the costs associated

with transferring the servers, providing power to run them, housing them and

connecting them to a network, duplication of the videos would require human

supervision at an additional cost. Id. DivX estimates that the cost of copying the

(Footnote Contd From Previous Page)

demand. However, as of the submission of this joint stipulation, given the passage ofthe December 22, 2008 deadline, UMGs motion is moot.

6 Milstein Decl. refers to the Declaration of Lee Milstein in Support of DivX, Inc.sOpposition to UMGs Motion to Compel Responses to Discovery from DivX, Inc.,filed concurrently.


Ex. B, Pg. 18



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entire video library, including rental fees, power, storage media, and supervision

could total over $300,000. Id.7

DivX long ago offered to undertake the task of creating a copy of the archived

videos as UMG demanded, provided UMG agreed to pay the associated costs. UMG

refused. In a further effort at compromise, DivX offered to prepare and produce a

searchable index for the hundreds of thousands of videos once accessible through the

service, including for each video (inter alia) the title, user supplied description,

duration, and upload date. See Milstein Decl., 9; Morris Decl., Ex. E. By searching

the index, UMG could identify the far smaller subset of videos of potential relevance

to this case, and obviate the need for restoring and copying them all. UMG rejected

that proposal as well, maintaining it was entitled to copies of all 750,000 videos.

B. UMGs Request for All Removed Videos is Overbroad and Seeks

Information That Is Not Relevant to Any Issue in the Case

UMGs request for an electronic copy of the entire database of videos that ever

appeared on the Stage6 site is overbroad, encompassing hundreds of thousands of

videos that do not have any relationship to the claims in this case. To address UMGs

sole relevance assertion the desire to identify alleged infringements DivX

proposed a solution that would give UMG access to those videos bearing some

indicia of relevance to this action. Armed with those videos, UMG could then run

whatever processes it wished to determine whether to assert claims based on those

videos. UMG has balked at DivXs proposal because it has no desire sensibly to

resolve this dispute; instead, UMG will accept nothing short of DivX providing three

quarters of a million videos so that it can identify a few hundred that it might

7 The ultimate cost of duplicating the entire video archive turns in large part on the onstorage media to which the videos would be copied. Relatively less expensivetapes could be used to house a copy of the archive, but the copy on tapes would behighly difficult to access and use for litigation purposes. Alternatively, the entirearchive could be copied onto considerably more expensive, but far more functionalservers.


Ex. B, Pg. 19



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someday claim are infringing. UMGs request is not reasonably calculated to lead to

the discovery of admissible evidence and should be denied.

1. UMG Has Not Made a Relevance Justification for Production ofthe 750,000+ Videos from the Stage6 Service

In moving to compel the production ofall videos from the Stage6 service,

UMG advances a single relevance theory: it wants DivX to produce 750,000 videos

so that UMG can identify hundreds (or possibly thousands) of additional videos as

being at issue in this case. See UMGs Contentions, C (UMG expects to find

hundreds if not thousands of additional alleged infringements). UMG therefore

concedes that the overwhelming majority of videos that would be produced if its

motion were granted (more than 99% by its calculations) have absolutely nothing to

do with this case. Accordingly, UMG has not raised any relevance justification for

most of the videos it seeks. Instead, it asks for massive discovery to find out which

materials are relevant and which are not. But that is not how civil discovery works.

UMG must show that the materials it seeks by discovery are themselves relevant or

reasonably calculated to lead to the discovery of admissible evidence. UMG has not

done so here.

Indeed, UMG recognizes that the production ofall videos is overbroad by

noting that many of the videos on the Stage6 service do not fit the profile of the

music videos at issue. See UMGs Contentions, B, n.3. UMG states that videos

shorter than 1 minute in length or over 7 or 8 minutes would not need to be searched

given that it is highly unlikely that such videos would constitute music videos. Id.

Yet UMG has moved to compel such videos even though it does not intend to

examine them to identify alleged infringements. Certainly, videos shorter than one

minute in length and longer than seven minutes should not be ordered produced and

the fact that UMG seeks them shows a desire to burden DivX instead of any

legitimate discovery need. More importantly, as addressed below, the Court should


Ex. B, Pg. 20



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rule as a general matter that only videos that have some plausible indication of being

relevant to this action need be produced.

2. DivXs Proposal Addresses UMGs Relevance Concern andAccounts for the Overbreadth of UMGs Request

DivX has offered to provide UMG with a subset of the videos, the ones it

identifies as potentially relevant after reviewing an electronic index of the Stage6

library. DivXs proposal is straightforward: (1) DivX will provide UMG with an

electronic, searchable index that includes the following fields, among others, for each

video: title, description, user, rating, duration, file size (Milstein Decl., 9); (2) using

the index, UMG would then select videos which it wants produced by searching for

artist names and/or song titles; and (3) DivX would produce any video identified by

UMG so long as UMG is willing to bear the costs of production.

UMGs objections to this protocol lack merit. First, UMG complains that a list

of file names would be insufficient to identify the songs that are at issue in this

action. But DivX has agreed to produce considerably more information regarding the

videos than the titles. See Milstein Decl., 9. More fundamentally, UMG cannot

hold up the isolated and hypothetical case of a video that is unidentifiable by its title

or other metadata as grounds for demanding production of hundreds of thousands of

undisputedly irrelevant videos. UMG has identified 2000 allegedly infringing videos

to date and claims that the production of the entire video database would only allow it

to identify hundreds or possibly thousands more. But UMG makes no effort to

quantify how many of these additional alleged infringements would go undetected

under DivXs proposal and there is absolutely no reason to think the number would

be significant. The possibility that UMG might overlook a few possibly relevant

videos under DivXs protocol (with thousands of others already asserted) is

inconsequential and hardly justification for the production of hundreds of thousands

of concededly irrelevant videos.


Ex. B, Pg. 21



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Second, UMG argues that DivXs proposal is impractical because it would cost

in excess of $250,000. That is inaccurate. DivX warned UMG that producing the

videos may cost in excess of $250,000 depending on the volume of videos you

request. See Morris Decl., Ex. E. DivXs estimate presumed that UMG would seek

a substantial portion of videos from the database and represented the outer range of

possible costs. If UMGs current predictions prove accurate and it only seeks

hundreds or possibly thousands of videos, DivXs production costs would be

considerably less. Indeed, DivX would be willing to pay the costs for the production

of up to 2,000 videos under its proposal. To the extent that UMG seeks videos

beyond that amount, UMG should bear those costs.8

UMG has not offered any relevance justification for seeking hundreds of

thousands of videos from DivX. No such justification exists given UMGs own

statements that it seeks only to add hundreds or possibly a few thousand additional

videos to this case. Given the purpose of the discovery sought, the Court should

adopt DivXs proposal because it ensures that the videos produced will have some

relationship to the claims in this action and avoids the staggering overbreadth of

UMGs demand.

C. UMG Seeks Through its Demand to Impose Undue Burden on DivX

It is beyond dispute that production of the entire Stage6 video archive would

entail substantial burdens. UMG makes no effort at all to rebut DivXs showing on

this issue. More importantly, UMG says nothing at all about Judge Matz view that

its discovery demand is unreasonable. In fact, all UMG offers is the notion that the

8 Providing a few thousand videos would be challenging for DivX but feasible. Asthe numbers grow, the manual process associated with providing discrete videosbecomes impossible and DivX would have to restore the entire service off-site anextremely costly and burdensome process. See Milstein Decl., 7-8 (noting that it isnot feasible to copy a significant portion of the videos on-site at DivX given powerconstraints and noting that copying videos off-site would cause significant costs).


Ex. B, Pg. 22



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burdens created by its demand could be mitigated if UMG is permitted to employ a

service to electronically analyze the archive.9 That position is meritless.

Before UMGs consultants could do anything at all with respect to the Stage6

archive, the archive would need to be restored to active service. Thus, all of the costs

associated with the restoration, transport, housing, networking and power for the

entire library would need to be incurred. Moreover, to ensure the integrity of the

original videos and for its ultimate evidentiary purposes, UMG would need to copy

the archive before running its screening processes on it. In short, UMGs approach

would do nothing to reduce the burdens imposed by its demand.

If UMG insists on receiving the entirety of the Stage6 video archive, the vast

majority of which is undisputedly irrelevant, UMG should be prepared to incur the

associated costs. The fact that it is unwilling to do so speaks volumes about UMGs

true motivations. As noted, UMG has already identified roughly 2000 alleged

infringements over which it proposes the parties litigate. Pressed to explain how it

planned to provide discovery, engage in motion practice and go to trial over this

already unwieldy number, UMG has had nothing to say. UMGs answer instead, has

come through needless motion practice, both here and before Judge Matz, aimed at

driving up DivXs cost of litigation.

For its part, DivX has proposed that the parties litigate over a representative

subset of works and alleged infringements a course this Court has contemplated in

other actions and that Judge Matz recently proposed in Perfect 10 v. Microsoft. In

Perfect10, likewise involving allegations of infringement by an online service, Judge

9 It is, of course, false to suggest as UMG does that this screening process couldsomehow determine infringement. Putting aside the various problems with theAudible Magic technology it contemplates using, the best this screening can do isidentify some set of potential matches against some set of reference files. In thatprocess, both the reference and the potential match would still need to be examinedinter alia (a) for accuracy; (b) to assess UMGs claims of ownership; (c) to considerquestions of express and implied authorization; and (d) to apply the doctrine of fairuse.


Ex. B, Pg. 23



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Matz recognized that limiting the case (at least in the first instance), to a subset of

alleged infringements would substantially cut discovery burdens, allow for the

expedient resolution of legal issues, and enable the parties to better gauge their

respective likelihoods of success. Judge Matz foreshadowed a similar approach for

this action back in August. See Morris Decl., Ex. B, p. 41 (Transcript at 28:19-21)

([Y]ou can extrapolate a whole lot of things from what youve already learned, even

if you dont have the actual content of the website.).10 And DivX months ago

proposed to UMG that the parties employ that approach here. See Morris Decl., Exh.

H. But UMG flatly rejected this expedient methodology, apparently hoping it can

wear down DivX through costly discovery demands and motion practice. UMGs

tactics should not be countenanced.

III. CONCLUSION

A. UMGs Conclusion

For all of the foregoing reasons, UMG respectfully requests that the Court

grant its motion to compel and enter an order directing DivX to produce documents

responsive to Document Request No. 2.

B. DivXs Conclusion

For the foregoing reasons, DivX respectfully requests that the Court deny

UMGs motion to compel in its entirety.

10 Judge Matz explicitly drew on his experience managing the Perfect10 cases toinform his management of the current case during the August case managementconference. See Morris Decl., Exh. B, p. 7.


Ex. B, Pg. 24



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Dated: January 5, 2009 ARNOLD & PORTER LLP

By: /s/ Sean MorrisSean Morris

Attorneys for PlaintiffsUMG RECORDINGS, INC.; UNIVERSALMUSIC CORP.; SONGS OF UNIVERSAL,INC.; UNIVERSAL-POLYGRAMINTERNATIONAL PUBLISHING, INC.;RONDOR MUSIC INTERNATIONAL,INC.; UNIVERSAL MUSIC MGB NALLC,; UNIVERSAL MUSIC Z TUNESLLC; and UNIVERSAL MUSIC MBGMUSIC PUBLISHING LTD.

Dated: January 5, 2009 WILSON SONSINI GOODRICH & ROSATICOLLEEN BAL (Bar No. 167637)[email protected] H. KRAMER (Bar No. 168452)[email protected] CHUNG-HAN (Bar No. 197572)[email protected] Page Mill RoadPalo Alto, CA 94304-1050Telephone: (650)493-9300Facsimile: (650) 565-5100

Attorneys for DefendantDIVX INC.

By: /s/ Colleen BalColleen Bal

Attorneys for DefendantDIVX, INC.

Case 2:07-cv-06835-AHM-AJW Document 99 Filed 01/05/2009 Page 22 of 22Case 2:07-cv-06835-AHM-AJW Document 141-3 Filed 02/18/2009 Page 23 of 23

Documents

UMG Tries to Force DivX to Use Audible Magic