You make some excellent points; replies below:
That was basically my point. Two things. Right now, there is an exception to the DMCA Anti-Circumvention rules for movies that applies to educational use, criticism, and normal home use under certain circumstances (for disability related reasons)
That's not from the courts, though, that's from the US Copyright Office. And, it is designed to really "head off" the most obvious First Amendment challenges to the rule.
The LoC exceptions process was built into the DMCA because it was believed (at the time) that traditional fair use protections would not apply to the anti-circumvention provisions of the Act, and Congress wanted to provide a regulatory process to provide fair-use-type exemptions (rather than leaving it up to the more usual judicial process). And that's exactly what the courts have mostly held: that traditional fair use does not apply to the anti-circumvention provisions of the act.
Essentially, the existence of those regulatory exceptions has been read by the courts as an argument that fair use doesn't apply to circumvention of DRM; the courts tend to say that you get the exceptions the the Library of Congress approves, no more, no less. That hasn't been universal (you see some lingering disagreement in the educational context), but it's the trend.
The courts won't carve out an explicit exception because this can only happen in response to a lawsuit from the relevant copyright owners. The studios wouldn't be dumb enough to go after anyone for whom the courts would be likely to grant such an exception. If it really is for personal use, you aren't re-distributing them, and of discs you own, and they were stupid enough to take the ongoing PR disaster of attacking you, the media companies would almost certainly (eventually) lose such a case.
I don't think the media companies would necessarily lose. I agree that they probably wouldn't bother to begin with, and of course, if they don't bring the case, it never gets resolved in court.
But if they brought the suit, I think they'd be likely to win based on the current state of the case law (see below for why).
They want to maintain the illusion in public that doing so would be ruled illegal, even though it almost certainly would not be, in practice. In other words, the DMCA law, as written, would probably be ruled unconstitutional if applied in this narrow case (because Fair Use), just like Betamax.
Actually, the Betamax case is a great example of how this situation is different.
In Betamax the rightsholders were suing a company (Sony) that was making a device that allowed copying of copyrighted media. Sony was selling that copying device for commercial gain. Sony won that case because the court held that the copying device had lawful fair uses (time-shifting, etc.).
In the DRM/DMCA context, commercial companies that create software or devices that bypass copy protection (i.e. people or companies in the position that Sony was in in the Betamax case) have also been sued by rightsholders. The difference is that they have mostly
lost their cases, because the courts have held that it's a different ball game, and there is no traditional "fair use" exemption to DRM circumvention. For example, RealDVD lost a DMCA case even though the court found that the RealDVD software had lawful fair uses.
Long story short: thinking about the DMCA in the traditional copyright context is kind of dangerous because recent cases have shown that the courts are really heading in a different direction on this. You may be right that a court might react completely differently to a private person breaking copyright protection for private use, but the state of the law right now is not encouraging.
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Bracketing out whether the MPAA would win in our hypothetical-highly-unlikely lawsuit, I think we agree that the rightsholders probably like the current atmosphere of fear and uncertainty, and recognize that such a lawsuit would, at minimum, be unprofitable and a PR disaster. And there is certainly a risk that they might lose the lawsuit into the bargain (whether due to a failure of proof, or because of the court recoiling in horror).
Which is why they are unlikely to bring one anytime soon, even if they knew they had grounds to sue someone in particular.
But I wouldn't bet the farm that they couldn't win one if they were motivated.
Again, the above is for informational purposes and not legal advice.
P.S.- I always enjoy talking to you, Glynor