Yes, if there was no provision in the law allowing them to do it, unless their "cutting" was telling the copyright holder what he had to do to his own film before it could be released.
The copyright violation would appear to be ANYTIME you rent a DVD to someone else.
Nope. Rental outlets have a license to rent the movies (the movies, not unauthorized edits of them).
How many stores get "authorization" to rent titles?
All of them, unless they're operating illegally. They pay a high per-copy price for that privilege. That's why replacement costs for lost movies are higher than what you'd pay to purchase a movie at the local store.
Er, no. If I'm running a video store in Badtasteville with a rental license for two dozen copies of Leonard: Part 6 and Joe Blow just can't bear to part with his copy and fails to return it, I still have the license, and can bring my count back up to twenty-four by acquiring another copy without any new license payment. If I bill Joe Blow a premium over and above the purchase price, that's a separate issue (and had better be in the rental agreement).
Every video I see prohibits public exhibition and leasing/ renting of videos.
WHO grants these licenses to "rent" dvds?
There is no such license. Not every video manufacturer is a member of the MPAA, RIAA, etc. Yet they all have the same warning.
There is no universal agent representing all filmmakers.
And in the case of Baltimore, the films were cut for exhibition there (John Waters had to deal with the censorship board cutting his films before their hometown premiere). The film played in the uncensored form in other markets.