Streaming video service VidAngel offers customers the option to stream "clean" versions of movies in order to avoid offending their delicate eyes and ears. The service allowed users to "purchase" a movie from VidAngel for $20, stream a potentially filtered version according to their preference, and then "sell" the movie back to VidAngel for $19. Their argument is that customers "own" a copy of the film while streaming it.
Hollywood disagrees, and they sued VidAngel in federal court in 2016 to stop them from unlicensed video streaming. An injunction was imposed on VidAngel forcing them to cease offering their service. VidAngel has since launched a streaming service that works on top of existing services like Netflix or Hulu, filtering out offensive content, while appealing the injunction in court.
A judge has ruled that the court was within its rights in issuing the injunction, and the ruling contains a geeky Easter Egg. VidAngel offered two defenses for its service: first, that it was operating under the provisions of the Family Movie Act of 2005, which allows the editing of an authorized copy of a film, and second, that VidAngel's censoring of the videos is "profoundly transformative" and therefore fair use under copyright law.
In the first case, the court ruled that VidAngel is not using an authorized copy of the films, and so is disqualified. On the second, the U.S Court of Appeals Ninth Circuit said that editing offensive bits out of a movie isn't transformative, adding: "Star Wars is still Star Wars, even without Princess Leia's bikini scene."
While VidAngel's rogue censorship program appears to be doomed, that doesn't mean their idea is completely useless. Sony thought it was a good enough idea to copy in releasing their own "Clean Version" program, offering altered copies of their own movies. However, the program was soon attacked by the Director's Guild, which claimed that Sony's censoring ways violated their own agreement with the studio.
It looks like, for now, if you don't want to watch Princess Leia's bikini scene in Return of the Jedi, you'll have to edit it out yourself.