Even as one California District court recently dismissed a case against Matthew Crippen, in which the prosecution asserted that he had modified the optical drive of an Xbox to circumvent the manufacturer’s anti-piracy measures, another court in the Golden State is scheduled to hear another much-watched case about game-console “modding.” What’s going on?

In Sony v. Hotz, Sony Computer Entertainment America claims that the defendants hacked its Technology Protection Measures to access the encryption key for the Playstation3 (PS3). (see the Sony complaint and Motion for Temporary Restraining Order) This has serious ramifications for Sony and other video game makers for the PS3 because the hack would allow pirated games to play on the PS3 unit and allow modification to the console firmware as well.

The Electronic Frontier Foundation posted a commentary that posits that, the purpose of SCEA’s lawsuit is to “send a message to security researchers around the world: publish the details of our security flaws and we’ll come after you with both barrels blazing.” Notably, the foundation refers to the defendants as one such group of “security researchers” that SCEA aims to intimidate with its lawsuit.

In its complaint, Sony describes thedefendants as members of “a group of hackers” who have violated several laws, including the DCMA Anti-Circumvention provision by developing and publicly distributing the circumvention devices necessary to access “a critical level of the PS3 System.”

The company claims that the circumvention devices allow pirated software to run on the PS3, which would result in the destruction of Sony business.

According to a post on engadget, the judge in the Northern District of California Court has declined to rule on the TRO due to jurisdiction issues.

*Full disclosure, the author of this post is not employed now by Sony, but did serve an internship with Sony Pictures Entertainment in December, 2010.