The rental company is being sued by Disney.
According to a report from Variety, Disney is suing Redbox for reselling digital copy codes of its films. Redbox obtains the codes from inserts that are included with the discs the company buys for its DVD and Blu-ray rental kiosks.
Redbox began selling digital copy codes for Disney films in October and charges between $5 and $15 per code. The selection of movies includes many popular titles like Star Wars: The Force Awakens, Guardians of the Galaxy Vol. 2, The Jungle Book, Moana, and more. After buying a code, users can pick-up a printout with the code and info on how to use it from one of Redbox's kiosks. The codes can then be used to redeem a digital copy of the selected movie through various supported services and devices.
For its part, Disney claims that by reselling these codes Redbox is now violating its contracts and copyrights. As such, the company filed a lawsuit against Redbox on November 30 in a federal district court in Los Angeles for copyright infringement. Disney is seeking an injunction on the sale of its digital codes through Redbox and is asking for damages of up to $150,000 per title sold. Likewise, the studio is also asking for all the money Redbox has made from the sale of its films.
Redbox does not currently have a direct distribution agreement with Disney, which means that the company actually buys all of the Disney DVDs and Blu-rays that it rents from the retail market. These discs frequently come with digital codes, but Disney states that the packaging indicates that they are not for resale.
Outside of these new legal worries, Redbox recently renewed rental deals with Sony and Lionsgate. Likewise, the company is currently adding new rental kiosks across the country and is set to have more than 41,500 kiosks nationwide. Redbox DVD rentals start at $1.50 per night and Blu-ray rentals start at $2 per night.