A group of Hollywood studios received good news when a judge hearing their case against 321 Studios, which makes software that allows consumers to make back-up copies of encrypted DVDs, said she was “substantially persuaded” by a pair of rulings that sided with the group’s argument that the software violates the U.S. Digital Millennium Copyright Act. The outcome of this case, 321 Studios v. Metro-Goldwyn-Mayer Studios, 02-1955, could determine the public’s fair-use rights for digital media.

U.S. District Judge Susan Ilston of the Northern District of California is hearing the case against 321 Studios.

321 Studio says its software is intended to allow consumers who purchase DVDs to make backup copies for personal use and argues that DVD owners who do it are exercising their right of “fair use”.

“Under the studios’ interpretation of the DMCA, there are no fair use rights of digital works at all,” said Keker & Van Nest partner Daralyn Durie during arguments.

Hollywood studios say the software enables piracy by allowing consumers to put movies on the Internet.

(via The Recorder)