Liberty Media's Starz Entertainment on Thursday sued Walt Disney Co. for letting other movie downloading services sell Pirates of the Caribbean: Curse of the Black Pearl and other films exclusively licensed to Starz.

Starz has paid more than a billion dollars since the contract began in 1993 for exclusive rights to Disney's films for set periods after the movies leave theaters. Starz offers 16 premium movie channels under the Starz and Encore brands, and it launched its Vongo Internet movie service last year.

"Consumers are attracted to pay TV because they can get first-run movies, uncut and without commercials, in an early window," said Robert Clasen, chief executive of Douglas County-based Starz. "These output deals are what drives our business."

The lawsuit comes after Apple's iTunes and Wal-Mart in recent months entered the increasingly crowded download-to-own video business. Disney was the first major studio to offer its shows and programs through iTunes. It has sold 1.5 million movies since September and expects to earn $25 million from the service this year.

Disney's Buena Vista Television unit said in a statement that Starz "misreads" the agreement and the Disney unit "has the right to sell its motion pictures in a wide range of mediums."

This isn't the first time that Starz and Disney have tangled over distribution rights in the digital age. In 2004, Starz sued Disney over its MovieBeam service, which sends films directly to customers who buy an electronic device. Disney ended up selling its interest in MovieBeam, and the lawsuit never went to trial.

"There is a pattern here of Disney deciding when there is an economic opportunity to look the other way" at its contractual obligations, Clasen said.

The lawsuit, filed in Los Angeles federal court, alleges breach of contract and copyright infringement. Starz is seeking to stop Disney's alleged infringement and asks for all profits from online sales.

The Starz deal allows Disney to sell DVDs and offer its films on a pay-per-view or on-demand basis, in which customers are limited to a single viewing. Outside of these venues, Disney is prohibited from licensing its films "in any form of television or electronic delivery," Starz said.

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