A federal court has handed a defeat to Kaleidescape, whose superb video-server technology has been fighting for its life in the courts for several years.

The appeals court in California reversed a 2007 ruling. That original ruling said Kaleidescape wasn't violating its contract with the DVD Copy Control Association, which controls the anti-copy mechanism in the DVD format. Previously, it was OK for Kaleidescape to unlock CCA's digital rights management scheme in order to copy the contents of DVDs to a server hard drive. Under this week's ruling, suddenly it's not OK, and Kaleidescape no longer has a viable product.

Kaleidescape is naturally "disappointed." Next stop: California Supreme Court.

This is Hollywood's second victory this week in its ongoing war against consumer fair-use copying. A different court had already ruled against RealNetworks, declaring its RealDVD disc copying application illegal.

See TWICE, EE Times, and The Wall Street Journal.