321 Studios was dealt a legal defeat when a California court ruled the company could no longer sell its flagship DVD-copying software. The company's DVDXCOPY software lets consumers create backup copies of DVDs. In the court ruling, the judge states that although consumers are legally allowed to make personal copies of their movies, selling products that break DVDs' antipiracy technology is illegal.
321 Studios has announced that it plans to fight the ruling. The company has also launched a Protect Fair Use campaign.