Zediva Shuts Down After Settling Lawsuit with MPAA

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The dream of an admittedly-overly-complicated way of ignoring existing copyright law in order to stream movies online is, it seems, over with the news that the lawsuit between the Motion Picture Association of America and website Zediva.com has been resolved, with Zediva agreeing to pay $1.8 million and permanently stop streaming video as a result.

The company had launched earlier this year, offering $2 movie rentals online to customers and immediately coming under fire for not having permission from the studios who owned the movies to do so; not—more importantly—the same kind of license that companies like Netflix, YouTube and Hulu need to stream content online. Zediva claimed that it didn’t need either, as what it was actually doing was renting physical DVDs to clients and then streaming the content of those DVDs online—something that they claimed was a private performance, and not public, and therefore only subject to the same kinds of restrictions as your local video store.

(MORE: Judge Rules Against Remotely Watching DVDs over the Internet)

A lawsuit over that defense was filed by the MPAA in May, and ruled in favor of the MPAA in August, but at the time, Zediva promised to appeal and “keep fighting for consumers’ right to watch a DVD they’ve rented, whether that rental is at the corner store or by mail or over the internet.”

That fight, however, ended late last week. According to MPAA SVP Dan Robbins, “This result sends a strong message to those who would exploit the studios’ works in violation of copyright law, on the Internet or elsewhere.”

A statement on Zediva’s website says, in part, “We are suspending Zediva’s operations to comply with an order by the United States District Court for the Central District of California. While we hope to be back online soon, we don’t know when (or whether) that will happen. We are disappointed by this turn of events, and that we are not permitted to serve you.”

[via The Hollywood Reporter]

Graeme McMillan is a reporter at TIME. Find him on Twitter at @Graemem or on Facebook at Facebook/Graeme.McMillan. You can also continue the discussion on TIME’s Facebook page and on Twitter at @TIME.