[fjtorres]

DRM is not the same thing as encryption.
DRM *can* use encryption or watermarks or other authorization mechanisms (Dongles, serial numbers, phone-home, etc) as authorization techniques.
Book publishers just happen to prefer encryption with internet-based authorization servers in their drm systems because they tie the content uniquely to the purchaser and/or their device(s).
Video disk systems, on the other hand, use generic embedded keys in the device itself to provide authorization and decryption. Which allows for lending and even resale of the content.
Under the listed terms and demands of the lawsuit, even watermark-DRM'ed content would be proscribed in whatever parallel universe it might prevail in.