Disney sues Redbox to stop digital movie sales

The Walt Disney Co. has sued Redbox to stop the home video kiosk company from selling digital versions of its movies.

Disney accused Redbox of violating its copyrights by selling digital codes that allow customers to download its movies, including 'Star Wars: The Force Awakens” and 'Beauty and the Beast.”

Disney does not provide Redbox with the codes, which customers redeem at authorized websites, according to Disney's complaint filed in U.S. District Court in Los Angeles.

Instead, Redbox buys DVD and Blu-ray packages that include codes to give consumers access to digital copies of movies. The company then takes apart the packs and sells the codes separately, Disney said.

Disney said that Redbox does not have permission to sell the codes and that the practice 'significantly undercuts” its normal prices. Redbox charges up to $14.99 for 'Rogue One: A Star Wars Story,” according to its website, compared with $19.99 offered on sites such as iTunes. Redbox sells some movie codes for as little as $7.99.

The Disney combo packs include a warning that 'codes are not for sales or transfer,” the studio said in its lawsuit.

Disney said it is asking the court to block Redbox from reselling the codes. The entertainment giant also is demanding damages in the form of Redbox profits, or up to $150,000 per infringed work.

Redbox said in a statement that the company is 'very confident in (its) pro-consumer position.”

Redbox has previously gone to blows with major studios, including Disney, because of its low-price rentals, which studios feared would eat into already declining retail sales.

A major feud flared in 2012 when Disney said it would not provide rental partners, including Redbox, with discs of its movie 'John Carter” until 28 days after the DVDs went on sale. Redbox responded by stocking its kiosks with discs purchased from retailers.