The argument is that the friend in question had no authorization to be sharing the password with anyone, violating the company's contract.

When you talk about violating contracts, that sounds like a civil matter, not criminal.

Wow. This is what happens when the legislative, judicial and executive are run by a bunch of Luddites.

Much ado about nothing. These companies (Netflix, HBO. etc.) are not going to start going after people for sharing passwords, and the first time they tried this ruling would be overturned. This is the Ninth Circuit, they send more cases to the Supreme Court than any other circuit and they have something like an 80% reversal rate.