What the law says
The Federal Copyright Act (Title 17, United States code, Public Law 94-553, 90 Stat. 2541) governs how copyrighted materials, such as movies, may be utilized publicly. Neither the rental nor the purchase or lending of a videocassette or DVD carries with it the right to exhibit such a movie publicly outside the home, unless the site where the video is used is properly licensed for copyright compliant exhibition.
This legal copyright compliance requirement applies to museums, film societies, parks and recreation departments, colleges, universities, public schools, day care facilities, summer camps, churches, private clubs, prisons, lodges, businesses, etc. regardless of whether admission is charged, whether the institution is commercial or non-profit or whether a federal, state or local agency is involved.
The movie studios who own copyrights, and their agents, are the only parties who are authorized to license sites such as museums, film societies, parks and recreation departments, businesses, etc. No other group or person has the right to exhibit or license exhibitions of copyrighted movies.
Furthermore, copyrighted movies borrowed from other sources such as public libraries, colleges, personal collections, etc. cannot be used legally for showing in colleges or universities or in any other site which is not properly licensed.
Unauthorized Public Exhibition of Movies
The concept of “public performance” is central to copyright and is the main issue of protection for these intellectual properties. Most of the persons participating in movie productions depend upon royalties for a major portion of their payment for work performed.
Royalties are the shares paid to movie producers, script writers, authors, computer programmers, playwrights, musicians, inventors, etc. out of the proceeds resulting from the sale, performance or use of their work. If these men and women lose ownership of their work and do not receive royalty revenue, much of which is collected through licensing fees, there will be little incentive for them to continue to invest their time, research and development costs to create future endeavors. If this happens, they must then look to the U.S. Copyright Law for assistance. Consequently, if their intellectual creations are being used by others who are not paying compensation (royalty) for the use, copyright law may need to be enforced.